The Tribune

By DEREK SMITH

“Strategy”, “new normal”, “pivoting” and, most recently, “agility” have been among the most popular buzz words and topics employed by speakers and presenters from around the world in recent months. Many top executives are consistently grappling with decisions surrounding change management, supply chain reliance and tele-working versus traditional working environments. And, besides wrestling with the above, management is also facing the enhanced regulatory agenda from international watchdogs that have initiated massive changes to their working environments. Conduct and culture are climbing up both the regulatory agenda and consumer (internal and external) expectations.

The reality is that corporate leaders have an excellent opportunity to optimise performance, mitigate risks, understand staff and protect their company’s brand while engaging in agile but approved practices. A strong compliance partner can be crucial to realising such opportunities. I submit that a compliance function’s main objective is operational. Therefore, if companies are looking to enhance their operational framework, it appears vital that compliance should have an independent but senior voice in the business.

Against this backdrop, here are three areas where a compliance function can assist with business agility and reputation management.

Compliance builds trust

Trust requires repeated interactions, honest communication and following through on commitments. Equally, agility demands interactions over process. Therefore, I would argue that the compliance function is the perfect catalyst to build trust and communicate consistently. Management should also trust but verify. A compliance function manages the verification of adopted policies, and reinforces the cultural values of an organisation. It also administers training around the importance of honesty, candor, rules and regulations.

Compliance is a collaborator

Historically, compliance seemed burdensome to many processes based on reaching out to internal partners as circumstances arose. This was needed, as compliance ensures internal processes are compliant with regulations and the values of the organisation. Agile regulatory risk management now includes identification changes, bringing together key business stakeholders to assess the impact and alterations required before process changes. This allows the affected stakeholders to have a direct conversation with compliance to ensure the final product and process is compliant. Moreover, stakeholders with differing views and interests balance themselves out. This adds to ongoing efficiency.

Compliance drives innovation and change

There are several approaches used for training throughout the world. Compliance has the opportunity to introduce adaptive compliance training versus linear compliance training. The one-size-fits-all approach, although grounded in history, does not subscribe to an agile environment. On the contrary, adaptive compliance fosters an interactive training environment that does not require in-person classes. It is dynamic and tailored to the nuances of the company. These principles of tailoring to needs can be replicated in sales approaches, compliance, employee experience, customer experience and business operations.

In short, to create an agile company, the partnership between executive leaders and compliance is critical in establishing the new normal. Working in silos, where decisions are made and compliance then provides credible challenges (advice, suggestions, alternative views) along the way undoubtedly interferes with efficiency. Cohesiveness, partnership and joint values will lead to a more nimble, attractive and desirous company for employees and customers alike.

NB: Derek Smith Jr is a compliance officer at a leading law firm in The Bahamas, and a former assistant vice-president, compliance and money laundering reporting officer (MLRO), at local private bank. His professional career started at a ‘Big Four’ accounting firm and has spanned over 15 years, including business risk management, compliance, internal audit, external audit and other accounting services. He is also a CAMS member of the Association of Certified Anti-Money Laundering Specialists (ACAMS).