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By Yin Wilczek
Feb. 27 — Although the stature of compliance continues to rise in the financial services industry, it must become a “disruptive force” to ensure it can keep up with the rapidly evolving business needs of the future, a new study by Accenture finds.
Among other problems, compliance personnel may be too complacent about emerging technologies, changing customer expectations and growing supplier and supply chain diversity, said the 2015 Compliance Risk Study.
Financial services firms “are adding new products, including non-financial products, and digital delivery channels to keep up with customer demand, which is increasing the need for rethinking existing compliance controls,” said Steve Culp, senior global managing director of Accenture’s Finance and Risk Services practice, in a release. “Compliance professionals who can keep pace with this changing ecosystem, partner with the front office and help the organization effectively meet the digital demands of its customers will be integral in driving competitive advantage.”
Conversely, compliance officers that pursue existing goals unchecked may find their functions diverging from their firms' future needs, the study stated.
The study—released Feb. 23—polled compliance officers at 150 banking, insurance and capital markets firms.
It found that while 80 percent of the respondents acknowledged that new business models fueled by shifting customer behavior and new delivery channels will force a revisit of compliance functions, 59 percent did not think that understanding technology trends is a key skill they need over the next five years.
Moreover, only half of the respondents agreed that understanding changing customer conduct was important to the compliance function, the study stated.
The study suggested that among other best practices, compliance personnel should take steps to become aware of the changing ways in which customers are interacting with their financial services providers in the new digital age, and how this is impacting financial services products, transactions and work performance.
It also recommended that compliance officers add forward-looking skills such as data management and analytics.
To maintain their seat at the table, compliance officers must show good compliance practices that add value to the organization while effectively adapting to market demands, said Accenture Managing Director Samantha Regan.
“Investing in forward-looking tools, such as data management and predictive capabilities, and building a team capable of working with these tools, can provide a view of the firm’s unique risks and help position compliance as a disruptive force capable of supporting and driving change in the organization,” Regan said.
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Accenture's study and release are available at http://newsroom.accenture.com/news/changing-consumer-and-digital-trends-may-force-modernization-of-compliance-functions-at-financial-institutions-according-to-accenture-report.htm.
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