The need for a Compliance-centric Culture
Since 2008, the banking industry has reported investing billions of dollars into compliance. In fact, the Economist’s Intelligence Unit found that banks stated that “responding to regulatory requirements” is their top business priority for the foreseeable future. Not to mention, regulators wouldn’t view a bank favorably if they noticed them lowering the amount of spending on compliance related activities.
Unfortunately, there is always push back when change is on the horizon. In the 2016 PWC State of Compliance survey, it was stated that 66% of compliance teams considered their compliance technology systems to be basic and the most common tools used were Excel spreadsheets and Google Search. David Zalman CEO of Prosperity Bank is quoted in Herman Cain’s “The Right Problems,”:
I’ve been in banking since 1978, and today, probably over half of my time is spent with regulatory requirements. The regulatory burden is a threat to traditional community banking. It is troubling that we don’t always know what the regulators are going to want.”
To patch up areas that are at risk for noncompliance, banks have been spending billions on external consultants, while also searching for a more permanent solution to their compliance woes. During this time, many financial institutions have been following an emerging sector called Regulatory Technology or better known as RegTech. Total spending on regulatory compliance technology is expected to rise from $50 billion in 2015 to $118 billion in 2020. A major goal for financial institutions is to to automate how they can stay ahead of new regulations, and improve their effectiveness with compliance and control.
The regulatory environment is mandating transparency and risk reduction, but with the current tools available,compliance teams are finding it very difficult to cope. With the number of financial regulation growing and a consumer focus on corporate governance and reputation, compliance teams are becoming more and more in the spotlight. Using this newly obtained power, compliance teams need to promote a new compliance-centric culture and evolve their existing arsenal to better equip themselves for the changes to come.
Compliance.ai’s mission is to simplify the lives of compliance professionals. They do so by providing a solution that notifies users when regulatory changes occur while also, streamlining regulatory research through focused filters and search capabilities. The company provides access to a comprehensive collection of highly curated financial regulatory content available on a single-view online dashboard. Compliance.ai’s AI-based platform is focused on financial and insurance services topics, insights, and personalized notifications. The SMART platform offers compliance professionals a fast and simple way to search, monitor, access, research, and track regulatory content.