Making compliance a competitive advantage – or: when Compliance is a competitive advantage and when it isn’t…

Traditionally, in the finance world, the word ‘Compliance’ was often met with a shrug or a grin. Times have however changed, and with them, so has the general opinion towards compliance, with many companies fortifying their compliance department and referring to their compliance approach as an indicator of its competitive advantage relative to its peers. At DX we believe in DX law: Technology and people get smarter by the day. The latter has however fallen behind in this case. Mc Kinsey published a study in 2017 about inefficiencies in the compliance department. (https://www.mckinsey.com/business-functions/risk/our-insights/sustainable-compliance-seven-steps-toward-effectiveness-and-efficiency). Probably worth a read!

Seeing the world through the eyes of a compliance professional is very different than seeing the world through the perspective of a company. Where one identifies and seeks to avoid risk, the other views calculated risk as a necessity for its survival and success.

Through our daily interactions with customers at DX Compliance we’ve seen a great change in the dynamics of the compliance department. Once dominated by lawyers, a growing demand for compliance professionals led companies to begin employing from outside the legal sphere.

Along with changes to the approach towards compliance and the roles the compliance team undertakes, one would have expected technology to progress along with them. Unfortunately, this was not the case. With most teams still relying on excel sheets and manual work, keeping regulators happy is a constant worry to each MLRO. There is a need for technology. And as automation becomes more integrated in the process and compliance professionals begin to focus elsewhere, the dynamics within the compliance team will once again change.

Compliance is critical to any business. I see 4 different cases where tech-enhanced compliance can be a competitive advantage.

1) Simpler Process

Technology will provide a boost to compliance departments on the user journey. and in collaborating with the regulators. Manual processes will lighten and mountains of data will no longer be burdensome.

2. More Efficient

Less false positives allows the team to concentrate on the true ones. Using data smarter is one of our approaches to our AML Transaction Software.

No more spreadsheets and JIRA? There is no lack of ROI.

3. Benefits for business processes – the Power of Compliance

The Power of Compliance. This is a topic that might be worth discussion with your colleagues.

4. Level of Automation

Back Office and middle Office automation is a hot topic in 2020. Don’t stay manual. Compliance teams are not under pressure to innovate but they have to effectively manage their day-to-day work.

The promise of Regtech is Trust and scale! Regtech enables companies to automatically monitor and respond to rising regulation and to become more flexible and customer centric. Harness the opportunities by tools and technology that support you and your team.

See what’s in front of you. The technology is there. Time can be managed better. Costs can be brought down and risk of fines can be eliminated.

Regtech is not focused on replacing compliance professionals. Its focused on supporting and enhancing their effectiveness, making them a sure competitive advantage.