Looking to buy a Compliance Management System?
Here are 8 important factors to consider.
1. Mirrors your compliance activities
There are fundamental differences in compliance management systems that are designed by experienced compliance professionals to those that are not. All too often we hear comments such as “we have looked at systems that are technology trying to be compliance” or “we need to automate all compliance activities – not only employee compliance” or “we looked at some systems, but they were just not sufficiently flexible”.
Ideally, the designers of compliance systems should be compliance professionals with a deep domain knowledge of the real-world challenges faced by compliance officers. When you review a compliance management system, it should align with your view of compliance and the challenges you face daily. In other words, does the system reflect the activities that you carry out daily and how you spend your time? Or are there significant gaps in the functions that it offers? Is it only automating interactions with employees for a small range of tasks, or does it support the wide range of tasks a compliance function carries out? And, importantly, is it sufficiently flexible and configurable to suit your company and way of working? Can you simply add custom fields and configure e-mail notifications and reminders?
2. Reduces Excel worksheet and e-mail use?
One of the most significant compliance challenges for financial institutions is the time their highly skilled compliance teams spend carrying out routine administration, due to the inadequacy of their management tools. We have evaluated it, and the cost is absolutely huge.
Quite simply, a compliance management system should substantially reduce routine administration, enabling you and your team to spend more time on value adding activities. For example, if managing your compliance monitoring Excel worksheet is one of the things that takes most time then it is vital your compliance management system minimises that burden. If tracking and managing regulatory changes takes up considerable time then, similarly, your compliance management system should make that easier.
3. Comprehensive reporting options
Management reporting is a key feature of any management system, but this can mean different things to different people.
Some simply want to export data to Excel and manipulate it themselves or to run pre-defined reports in PDF format. Others may simply want to pull data into their own data warehouse, for example using an API connection, or have a high-level dashboard view of key indicators.
Whatever your reporting preferences, now and in the future, your management system should support it!
4. Future proofed technology
The technology of the future is generally likely to be cloud based, with all the benefits that brings of lower maintenance and support costs, and increased security and resilience.
Additionally, it is critical that systems are API enabled and facilitate integration with other platforms.
5. Comprehensive evaluation
It is critical to be fully confident that your chosen system will deliver the benefits you expect, “no one likes surprises.”
To fully understand a system, you should be able to engage in a number of different evaluation activities. These might include a system demonstration to you and other senior management colleagues and team members or going further and taking a “test drive” or carrying out a formal pilot or proof of concept. However, it happens, you need to move forward with confidence having undergone a proper evaluation.
6. Simple implementation
Having selected a system, you need to know you will be able to realise its benefits quickly. Implementation should be quick and simple, with the right level of support to implement with a minimum level of disruption.
Talk to your supplier about their approach to implementation and get a feeling for how onerous it will be to achieve the benefits you expect.
7. Ongoing Support
Once implemented, you will expect to use your compliance management system for some time. You need to be sure that you trust your provider to provide the right level of support to you and your team. Are they responsive and do they listen and communicate quickly and effectively? Do they have a solid understanding of the real-world challenges of a compliance department? And, as the automation of compliance management is still in its infancy, do they have the budget, commitment, vision and compliance awareness to continue to drive the RegTech industry forward?
8. Delivering stakeholder confidence
Delivering confidence to a wide range of stakeholders is one of the ongoing challenges for all compliance functions. Whether it is your board, risk committee, ExCo, internal auditors or regulators themselves, you will always want to convey that you are in control.
Your compliance management system should enable you to demonstrate your control over key compliance processes and activities, allowing you to see your compliance status in real time and to evidence the activities you undertake to maintain and evidence your compliance.