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Compliance Trends Survey

Posted by: Laurence Simons 10/08/15

The 2015 Report, compiled by Deloitte and Compliance Week, consists of 35 questions that are grouped into four broad categories: the resources that compliance departments have; the responsibilities and activities with the compliance operations; the specific compliance risks within the extended organization; and the use of technology.

The data from the responses to this question – coming from all over the world – has been gathered and used to answer the following three questions surrounding how jobs in compliance are being fulfilled:

• Do compliance executives have the appropriate authority and resources to do their jobs?
• Are compliance executives assessing the right risks in the right way?
• How do compliance executives use technology to tame the challenges they face?

Authority and resources

The report states that out of its 364 respondents, 57% revealed that their CCO reports directly to either the chief executive officer (CEO) or the board. Historically, this number has been far from steady, but is now clearly climbing upwards. 51% also claimed that the CCO has a seat on the executive management committee, contrasting with 59% who say the CCO job is a stand-alone position.

Participants agreed that there was still some difficultly in embedding the compliance function in the entire organisation. The statistics revealed that only 43% of respondents said their corporations have designated compliance officers in subsidiaries, business units, or geographic markets; 44% do not.

Correct risk assessment?

The three most common responsibilities CCOs listed this year were compliance training, code of conduct, and the whistleblower hotline – the same top three duties from last year’s survey. Interestingly, tasks such as records management, relationships with regulators, and even culture assessment all ranked near the bottom for both years (and in previous years as well).

82% percent of organisations now undertake some sort of enterprise-wide compliance risk assessment. Howard Friedman, Deloitte & Touche LLP director and leader in the company’s energy and resources risk and regulatory practice, thinks CCOs are being challenged and so are refining their measures of effectiveness. He comments that: “I’m seeing more compliance officers being asked to justify the business value of the compliance function. Boards and executive leadership often need more data to support budgets and resource allocations.”

What technology is used?

A mere 32% of respondents reported confidence in their organisations’ IT systems – down from 41% in 2014. Most revealed that their primary software is either on their desktop or consists of internally-developed tools, regardless of the size of the company or the organization. Although big data looks to profit many sectors – particularly compliance – it is not being properly taken advantage of.

The report concludes that although the position of the CCO is becoming more influential within the core management of the business, there are still concerns about challenges the discipline must overcome. It is becoming clear that more innovative technology would be beneficial to the sector, greatly increasing professionals’ trust in available systems and processes. Perhaps with stronger relationships between the CCO and executive management, this may position internal departments in a beneficial place for future progression.