After a tumultuous past two years, financial institutions continue to navigate complex regulatory requirements, risks, third-party relationships, global supply chains, and other challenges. This web of governance, risk, and compliance (GRC) concerns requires a holistic perspective of regulatory obligations across business functions.
Let’s take a look at some of the areas where financial services firms will need a proactive, integrated approach to compliance management going into the rest of 2022.
Financial regulators such as the OCC and SEC receive massive troves of data from the firms they regulate as well as from other sources such as global regulatory authorities, investors, and whistleblowers.
These agencies expect the data in reports and disclosures to be accurate, timely, and reliable. With increasing legislation and regulatory attention on issues like ESG compliance and data privacy, now is the time for institutions to ensure they have sufficient processes and controls for data management. Adopting frameworks and technology that provide actionable insights is critical for identifying data trends within your organization and meeting regulator expectations.
Related Reading: Unsiloing Your Data for Better GRC Management >
Organizations often neglect to keep their policies organized and up to date, resulting in important information being inaccessible, outdated, or improperly communicated to employees. A single system for creating, storing, revising, and accessing policies supports a unified approach to policy management and helps reduce compliance risk.
Governance strategies should prioritize communicating policies and compliance standards, providing employee training, and other policy management best practices.
Related Reading: Policy Management Best Practices Playbook >
Over the course of the pandemic, fraud risk has increased exponentially. The risk of your institution being used to facilitate fraud or other financial crimes has never been higher.
Organizations should reassess internal controls to ensure they are sufficient and properly documented. Your firm’s policies and risk culture need to support personnel in monitoring and reporting any unauthorized or suspicious activities. Banks and credit unions must take added steps to expand the scope of their anti-corruption and anti-money laundering compliance practices as the regulatory landscape evolves.
Related Reading: 3 Ways CCOs Can Manage Anti-Bribery & Corruption Compliance >
Money laundering has been a growing concern for regulators around the globe. Expanded regulation increases the likelihood of fines regardless of whether the institution has facilitated any crime. The European Union has already introduced several AML regulatory changes, and U.S. agencies will likely follow suit. Firms must take a proactive approach to AML compliance with transaction monitoring, suspicious activity reporting, and risk assessment.
Related Reading: How GRC Can Improve Compliance with AML Regulations >
Regulatory agencies expect you to have a resilience management plan that can pivot as operational and compliance landscapes shift.
Financial services organizations need an integrated view of risk and compliance across operational areas to build resilience to disruptions. Understanding how risk interconnects across business units, third parties, information security, compliance, and other functions is the only way to gain a full picture of your institution’s ability to address uncertainty and the impact on objectives.
Related Reading: Building Operational Resiliency for Financial Institutions >
Corporate compliance is a crucial component of any GRC strategy. As compliance teams prepare to navigate uncertainty in these and other areas in 2022, adopting flexible frameworks and tools for monitoring, managing, and documenting compliance has never been more important.
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