PwC's State Of Compliance Study shows what separates the best from the rest
Powerhouse consulting firm PwC recently released its 2018 State Of Compliance Study, the seventh in a series designed to help leading companies' compliance and ethics risk-management efforts be "more agile and more effective." The study is built around a PwC poll of 825 risk and compliance executives. Questions focused on compliance policies and the technology that facilitates compliance activities.
The study identifies 17% of respondents as Leaders: those "very satisfied with the effectiveness of their compliance programs;" who implemented "progressive practices in all aspects of compliance risk management;" and used "information and technology to increase program effectiveness." Per the study, there are four specific ways Leaders execute their compliance programs differently than non-Leaders:
Importantly, regtech helps firms address regulatory challenges in a comprehensive and cost-efficient manner. Cloud infrastructure, machine learning, and advanced analytics are all part of regtech, and allow firms to analyze large volumes of data and quickly determine potential risks to the business at a reasonable cost. Per the study, leaders "more often have various infrastructure elements in place" than their peers, and "more often use data-analytics tools, dashboards, and continuous monitoring" than their peers. Leaders also follow "deliberate strategies to build technology infrastructure for the future."
And when it comes to monitoring personal trading, gifts and entertainment, fraud, privacy, and social media, Leaders are more likely than non-Leaders to use technology at least intermittently, if not continuously, to monitor these key areas. Also, technology-enabled compliance monitoring is most effective when combined with "available data and data sources at their organizations," including from HR, IT, finance, the supply chain, and procurement. Finally, Leaders also "cite more benefits" from tech use than non-Leaders, suggesting "Leaders generate greater returns on their technology investments."
Second, Leaders are more likely than non-Leaders to have a single policy-management framework, one that applies to "all corporate polices and procedures, including those related to ethics and compliance." Third, and closely related, Leaders more often streamline this framework through the use of policy-management software. Fourth, Leaders measure the effectiveness of their policies and procedures more comprehensively than non-Leaders.
Leaders are also more likely to keep their training risk relevant, to more strongly engage employees and help them remember exactly what it is they're supposed to be doing. Finally, Leaders say they plan to increase their use of training that is dynamically triggered by monitoring activities, another benefit of automation technology, and are investigating varied ways to conduct training. These include: (1) shorter, more frequent training; (2) Ted-Talk-like awareness videos; and (3) the use of mobile apps, seen as a cost-effective way to increase employee engagement with compliance.
Read the entire PwC 2018 State Of Compliance Study here.
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