Connect with us

Top Stories

Five key practices to ensure a proactive approach to regulatory change

Published

on

Five key practices to ensure a proactive approach to regulatory change

By John Palmiero, SVP of EMEA at governance, risk and compliance software organisation, MetricStream

The sheer volume, velocity, and complexity of regulatory change is likely to keep many chief compliance officers (CCO) awake at night. Why is it that enterprises across the globe struggle to keep pace with the rapid onslaught of regulatory change? What is the approach organisations need to take to stay ahead in this race?

In the past, during the pre-financial meltdown era, it may have been possible to keep track of regulatory updates using standard manual approaches. However, as regulators continue to introduce more reforms and as rapidly evolving and disruptive technologies – such as fintech, IoT, Blockchain and cryptocurrencies – continue to appear, traditional approaches are proving less and less effective.

It appears that organisations have some catching up to do with the rapidly evolving regulatory environment. In fact, a recent KPMG survey revealed that only 27 percent of CCOs state that their compliance function has a change management process in place to identify changes in laws and regulations, and to incorporate such changes into their policies and procedures.[1]

The time has come to develop a robust and technologically reinforced regulatory change management framework to help manage the rapidly increasing volume of regulatory reforms. A “wait-and-watch” approach is no longer sustainable and companies need to proactively address this business challenge before it is too late. Below are five key guidelines that will help firms to develop a regulatory change management framework that can equip them with the right set of tools to manage regulatory flux and be prepared for the next wave.

proactive approach to regulatory change

 

Stay on top of regulatory updates

In the current business environment, enterprises have to keep track of regulatory content from global as well as regional regulators, from a multitude of sources including regulatory publications, industry associations, national, and local media, and specialised content providers. With so many sources to keep track of, and high volumes of relevant content to analyse, it’s a time-consuming and resource-intensive exercise.

Cloud-based content platforms can serve as an aggregator for regulatory content from various sources. Using platform technology, compliance professionals can subscribe to curated content based on predefined rules and keywords, which can be streamed directly as RSS feeds, alerts, or email notifications. The organisation can set predefined rules on a variety of regulatory attributes including industry, jurisdiction, topic, state, due date, etc., thereby ensuring that relevant information reaches subscribers in real time.

Ensure a common regulatory taxonomy

Every global firm has to deal with inconsistencies in regulations across geographies and multiple business operations. A standard regulatory taxonomy, in line with the organisational hierarchy, and consistent in terms of language, terminology, and structure will improve communication among stakeholders, making it easier to set up a robust compliance framework. Additionally, companies will then be able to categorise, store, and deliver regulatory updates without having to frequently modify the rules and linkages that have already been set up in the system.

An efficient way to standardise the taxonomy is to set up a centralised GRC repository to store all regulatory updates from across the organisation, index updates according to the established hierarchy, and map them to multiple GRC attributes such as risks, controls and policies.

Assign regulatory responsibilities

In order to ensure accountability, it is important to clarify the roles and responsibilities of the individuals who manage the compliance function. While a cloud-based content platform will ensure the right information reaches the right set of users, each user should be a trained compliance professional with the ability to scrutinise these regulatory updates, in order to determine whether they are applicable to the organisation. Relevant senior management executives (SMEs) need to be identified within the enterprise, who understand the laws or regulations, and have sufficient knowledge to analyse these updates in detail.

To achieve this, enterprises need to ensure that there is a first level of screening or assessment by a centralised regulatory coordinator to determine how applicable the regulatory updates are. He or she would then pass the mantle on to individual assessors within relevant departments for detailed impact analyses. Finally, collaboration with external stakeholders also becomes important when regulators, customers, business partners, and other parties need to be informed on any changes in the firm’s overall processes, policies, controls, or other factors.

It is important to clearly document these roles and responsibilities, establishing accountability in the complete information lifecycle, from the time a new alert is delivered, to the time it is successfully implemented. Additionally, it is recommended that the senior management be actively involved at each stage and the board has clear visibility into the whole process.

Assess the business impact

Every regulatory update needs to be assessed in terms of its business impact. After the initial applicability assessment, each business unit can carry out a detailed impact analysis on an update to identify which risks, controls, policies, procedures, trainings, and reports are affected and need to be revised.

It is also important to group similar regulatory updates, as it will help not only in eliminating duplicates but also in identifying similar trends and patterns in the risks, controls, policies, and other areas that are impacted. This analysis then needs to be rolled up as per the defined organisational hierarchy to provide a holistic view of the impact across the enterprise.

At any point in time, a company should be able to gain a comprehensive view of the number of regulatory updates affecting them both holistically, and by business unit or functional area.

Implement regulatory change

The next step would be to formulate action plans, listing out tasks that need to be assigned to relevant users. Standard workflows need to be defined for the review and approval processes, with escalation capabilities when the tasks become overdue. Additionally, to ensure nothing goes amiss, it would help if business users are notified of the tasks that have been assigned to them through standard email notifications and reminders.

At each stage of the implementation process, reports and dashboards should give stakeholders visibility into the real-time status of the changes taking place, accountability, and the overall impact on the organisation. Furthermore, companies should ensure that issues or findings are logged with defined remediation plans for quick and efficient issue resolution and closure.

Regulatory change is not going to abate. In a world confronted with geo-political turmoil, cyber-attacks, business fraud, and social media influence, firms need to buckle up and take measures to tackle regulatory change head-on. Technology can be a strong enabler in addressing this need.

Organisations can opt for a robust and comprehensive regulatory change management solution that leverages a common foundation to facilitate multidimensional mappings with other GRC elements. Such a solution can help centralise disparate, siloed, and manual operations across business units and geographies, and align them with the enterprise’s overall business goals and objectives. This will not only help them track and analyse the all-too-frequent regulatory changes, but also ensure that these changes are effectively, and efficiently implemented. A proactive approach to regulatory change, backed by technology, is perhaps the most effective way in complying with the regulatory uncertainties of our times.

[1] KPMG: The compliance journey, 2017https://assets.kpmg.com/content/dam/kpmg/pa/pdf/compliance-journey-survey-2017.pdf

Top Stories

Bitcoin, ether hit fresh highs

Published

on

Bitcoin, ether hit fresh highs 1

SINGAPORE (Reuters) – Bitcoin hit a fresh high in Asian trading on Saturday, extending a two-month rally that saw its market capitalisation cross $1 trillion a day earlier.

The world’s most popular cryptocurrency rose to an record $56,620, taking its weekly gain to 18%. It has surged more than 92% this year.

Bitcoin’s gains have been fuelled by evidence it is gaining acceptance among mainstream investors and companies, such as Tesla Inc, Mastercard Inc and BNY Mellon.

Ether, the second-largest cryptocurrency by market capitalization and daily volume, hit a record $2,040.62, for a weekly gain of about 12%.

Ether is the digital currency or token that facilitates transactions on the ethereum blockchain. In the crypto world, the terms ether and ethereum have become interchangeable.

Ether futures contracts launched on derivatives exchange CME earlier this month.

(Reporting by Vidya Ranganathan; Editing by William Mallard)

Continue Reading

Top Stories

World Bank pushing for standard vaccine contracts, more disclosure from makers

Published

on

World Bank pushing for standard vaccine contracts, more disclosure from makers 2

By Andrea Shalal

WASHINGTON (Reuters) – The World Bank is working to standardize COVID-19 vaccine contracts that countries are signing with drug makers, and is pushing manufacturers to be more open about where doses are headed, as it races to get more vaccines to poor countries, the bank’s president said on Friday.

World Bank President David Malpass told Reuters he expected the bank’s board to have approved $1.6 billion in vaccine funding for 12 countries, including the Philippines, Bangladesh, Tunisia and Ethiopia, by the end of March, with 30 more to follow shortly thereafter.

The bank is working with local governments to identify and fill gaps in distribution capacity, after they purchase vaccines under a $12 billion World Bank program, and also to standardize the contracts they are signing with manufacturers, he said.

The bank’s International Finance Corp, its private financing arm, has $4 billion to invest in expanding existing production plants or building new ones, including in developed countries, but needs more data on where current production is headed, he said.

“We are eager to be investing in new capacity, but it’s hard to do because you don’t know how much of the existing capacity is already committed to the various off-takers,” Malpass said in an interview with Reuters. New or expanded plants could be used to produce other types of vaccinations in the future, he said.

The bank’s funds could be used to expand plants in advanced economies, if the production was earmarked for developing nations, he said.

Malpass welcomed Friday’s pledge by the Group of Seven rich countries to intensify cooperation on the pandemic, saying it could help jump-start deliveries of vaccines to poorer countries, which are lagging far behind rich countries in getting shots in arms.

Data compiled by Our World In Data, a scientific online publication, showed Israel was leading the world in COVID-19 vaccinations, with nearly 82 of 100 people vaccinated, while India and Bangladesh reported less than one person per 100, Many African countries have not started at all.

Malpass said he was heartened by news about new vaccines coming down the road, and about Pfizer Inc and BioNTech SE seeking permission to store their vaccine at higher temperatures, which would ease another obstacle to deliveries in lower-income countries.

(Reporting by Andrea Shalal; Editing by Heather Timmons and Leslie Adler)

Continue Reading

Top Stories

Google to evaluate executive performance on diversity, inclusion

Published

on

Google to evaluate executive performance on diversity, inclusion 3

By Paresh Dave

(Reuters) – Alphabet Inc’s Google will evaluate the performance of its vice presidents and above on team diversity and inclusion starting this year, the company said on Friday in one of several responses to concerns about its treatment of a Black scientist.

Timnit Gebru, co-leader of Google’s ethical artificial intelligence research team, said in December that Google abruptly fired her after she criticized its diversity efforts and threatened to resign.

Alphabet and Google Chief Executive Sundar Pichai ordered a review of the situation. While Google declined to share specific findings, the company announced on Friday it will engage human resources specialists during sensitive employee departures.

Pichai in June said that by 2025, Google aims to have 30% more of its leaders come from underrepresented groups, with a focus on Black, Latinx and Native American leaders in the United States and female technical leaders globally. About 96% of Google’s U.S. leaders at the time were white or Asian, and 73% globally were men.

As a result of the investigation, the company also expanded a commitment announced in June to devote more resources to retaining and promoting existing employees, including by expanding a team addressing disputes among workers and their managers.

The diversity component of executive performance reviews was not previously announced, and the company did not immediately share details about what would be measured and how pay would be affected.

Alphabet for years had rejected proposals from shareholders and employees to set diversity goals and tie executive pay to them.

Irene Knapp, a former Google employee who advocated for one such proposal at a 2018 shareholder meeting, said on Friday, “I am pleased that they met our demand from 2018, which was a bare minimum that should have been easy to do immediately.”

Evaluating managers on diversity goals is becoming more commonplace. McDonald’s Corp on Thursday tied executive bonuses to diversity.

(Reporting by Paresh Dave; Editing by Cynthia Osterman)

Continue Reading
Editorial & Advertiser disclosureOur website provides you with information, news, press releases, Opinion and advertorials on various financial products and services. This is not to be considered as financial advice and should be considered only for information purposes. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third party websites, affiliate sales networks, and may link to our advertising partners websites. Though we are tied up with various advertising and affiliate networks, this does not affect our analysis or opinion. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you, or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish sponsored articles or links, you may consider all articles or links hosted on our site as a partner endorsed link.

Call For Entries

Global Banking and Finance Review Awards Nominations 2021
2021 Awards now open. Click Here to Nominate

Latest Articles

FTSE Russell to include 11 stocks from China's STAR Market in global benchmarks 4 FTSE Russell to include 11 stocks from China's STAR Market in global benchmarks 5
Trading13 hours ago

FTSE Russell to include 11 stocks from China’s STAR Market in global benchmarks

SHANGHAI (Reuters) – Index provider FTSE Russell will add 11 stocks from China’s STAR Market to its global benchmarks, according...

Foxconn chairman says expects "limited impact" from chip shortage on clients 6 Foxconn chairman says expects "limited impact" from chip shortage on clients 7
Business13 hours ago

Foxconn chairman says expects “limited impact” from chip shortage on clients

TAIPEI (Reuters) – The chairman of Apple Inc supplier Foxconn said on Saturday he expects his company and its clients...

Bitcoin, ether hit fresh highs 8 Bitcoin, ether hit fresh highs 9
Top Stories13 hours ago

Bitcoin, ether hit fresh highs

SINGAPORE (Reuters) – Bitcoin hit a fresh high in Asian trading on Saturday, extending a two-month rally that saw its...

UK insurers estimate to pay up to 2.5 billion pounds for coronavirus claims 10 UK insurers estimate to pay up to 2.5 billion pounds for coronavirus claims 11
Trading13 hours ago

UK insurers estimate to pay up to 2.5 billion pounds for coronavirus claims

(Reuters) – The Association of British Insurers (ABI) said on Saturday insurers are likely to pay up to 2.5 billion...

Citigroup considering divestiture of some foreign consumer units - Bloomberg Law 12 Citigroup considering divestiture of some foreign consumer units - Bloomberg Law 13
Banking13 hours ago

Citigroup considering divestiture of some foreign consumer units – Bloomberg Law

(Reuters) – Citigroup Inc is considering divesting some international consumer units, Bloomberg Law reported on Friday, citing people familiar with...

World Bank pushing for standard vaccine contracts, more disclosure from makers 14 World Bank pushing for standard vaccine contracts, more disclosure from makers 15
Top Stories13 hours ago

World Bank pushing for standard vaccine contracts, more disclosure from makers

By Andrea Shalal WASHINGTON (Reuters) – The World Bank is working to standardize COVID-19 vaccine contracts that countries are signing...

Google to evaluate executive performance on diversity, inclusion 16 Google to evaluate executive performance on diversity, inclusion 17
Top Stories13 hours ago

Google to evaluate executive performance on diversity, inclusion

By Paresh Dave (Reuters) – Alphabet Inc’s Google will evaluate the performance of its vice presidents and above on team...

EU seeks alliance with U.S. on climate change, tech rules 18 EU seeks alliance with U.S. on climate change, tech rules 19
Business13 hours ago

EU seeks alliance with U.S. on climate change, tech rules

By Sabine Siebold and Kate Abnett BERLIN (Reuters) – Europe and the United States should join forces in the fight...

Oil extends losses as Texas prepares to ramp up output after freeze 20 Oil extends losses as Texas prepares to ramp up output after freeze 21
Trading13 hours ago

Oil extends losses as Texas prepares to ramp up output after freeze

By Devika Krishna Kumar NEW YORK (Reuters) – Oil prices fell for a second day on Friday, retreating further from...

Dollar edges lower as investors favor higher-risk currencies 22 Dollar edges lower as investors favor higher-risk currencies 23
Investing13 hours ago

Dollar edges lower as investors favor higher-risk currencies

By Stephen Culp NEW YORK (Reuters) – The dollar lost ground on Friday as market participants favored currencies associated with...

Newsletters with Secrets & Analysis. Subscribe Now