Lately, I feel there is a lot of talk about the changing role of the Chief Compliance Officer (CCO) within the financial services industry. So much so I’m planning to base a session around this topic at our upcoming 2nd Annual Buy-Side Compliance & Risk conference on December 9th. With that being said, I wanted to do a little investigating to see what specifically has changed for the CCO in the past year. Is their role completely changing or just becoming more intense?
After researching I can firmly say the CCO has a lot riding on their shoulders these days. Among other things the CCO has to stay up-to-date on the changing laws and regulations, develop an annual compliance work plan, oversee implementation of compliance programs, reduce openness to fraud and abuse, monitor compliance within all departments, and be the main contact for all government reviews and coordinate internal investigations. But are these new issues that the CCO did not have to deal with before 2008? Did the market meltdown open everyone’s eyes to what can happen to the economy and intensify the need for regulation and transparency? Maybe we shouldn’t be talking about the changing role of the CCO, but rather the increasing importance of the CCO.
It seems the CCO and compliance teams have a lot coming at them at once. Regulation is being updated and changed constantly, which means all staff needs to be continually briefed on the new requirements for implementing the changes. Then there’s the fact that a day doesn’t seem to go by without the news reporting on someone or another committing fraud. Meanwhile, all information is, for the most part, still being handled manually, meaning compliance technology needs to improve on automation. Also, all of this has to be handled efficiently and in the most cost effective manner! You also have to keep in mind that if anything goes awry within the firm , the CCO is the one who will be questioned… that’s a heavy load to bear. If you didn’t already respect your CCO, then you should now!
So, now I’m thinking I should focus a session at the Buy-side Compliance & Risk conference around the challenges the CCO is currently facing, rather than their “changing role”. The focus should be on new regulation and what can be done to create more efficient processes firm wide. Also, there can be a spotlight on what technology is currently available and what improvements are still needed on that front. This can give both the software providers and the CCOs the feedback and knowledge they need to walk away and make improvements