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“Targeting ‘minimum viable compliance’ in an attempt to remove cost is a false economy fraught with danger,” says Burgess.

“This approach views compliance as merely a financial cost to be minimised, which is short-sighted and likely fails to consider customer and community expectations, as well as alignment with longer term business objectives.

“If you’re only aiming to just scrape through on compliance then you are left with very little margin for error and a high risk of falling short. When the spotlight is still firmly on the financial services sector, that’s an unacceptable business risk and the costs of remediation are significant.”

Take advantage of technology

The key for financial services firms to improve regulatory compliance, without increasing the burden on the business, is to take advantage of technology to integrate compliance outcomes into core business processes, rather than treating compliance as an ancillary process.

“When compliance controls are baked into business processes, not only does it reduce inefficiencies, but also provides real-time feedback on how businesses are performing and enables early intervention, which reduces more significant disruption as the business scales in a competitive market,” says Burgess.

Investing in business process simplification through the smart use of technology to improve both consumer and compliance outcomes is becoming easier every day and is good for business.

Future proof

For most organisations, technology is the key to remaining compliant and future-proof. They are realising that the use of technology solutions can help them manage compliance more effectively while balancing costs.

By semi-automating workflows and leveraging predictive tools, organisations can streamline processes around compliance obligation reviews, risk and control analysis and assessments, stress-testing, transaction monitoring and others.

This approach helps organisations improve their operations and strengthen their vigilance around risk appetite, enabling them to anticipate and mitigate risks before they escalate.

“As organisations face continued regulatory change and rising costs, a dual-pronged approach to managing compliance is necessary,” says Bill Wong, chief of staff and head of strategic excellence, enterprise risk & compliance, Allianz Australia Insurance.

“Compliance by design is imperative as we look forward, but investments in automation, artificial intelligence and strategic partnerships are equally important in lifting and expanding the existing base/capabilities.

“These solutions enable organisations to manage increased regulatory demands more nimbly, while also creating opportunities for savings and efficiencies.”

Increased visibility

“Financial services firms’ efforts to optimise compliance through technology must be accompanied by enhanced visibility to ensure that compliance failures are identified early, their impact is limited, and remediation costs are minimised,” says Protiviti director Ruby Chen.

“Many of the non-compliance issues recently uncovered at major financial services providers had been left unaddressed for many years, exacerbating their impact,” Chen says.

“Financial services firms can no longer risk having an outstanding compliance or regulatory issue. As regulators get tougher in the future, the consequences of simply claiming ‘we were unaware’ will be felt at the highest levels of an organisation.”

Along with enhanced visibility into their current compliance status, financial services firms also need to take a more proactive approach to addressing regulatory change, she says.

“When it comes to compliance, early detection, better horizon scanning and forward forecasting are required to get on the front foot, rather than passively reacting to impending regulatory changes or other emerging risks,” says Chen.

“Further investment in digitisation, automation and predictive analytics is key to optimising compliance costs while ensuring that the business isn’t left exposed.”

Please visit Protiviti to stay ahead of regulatory changes with robust compliance strategies and discover how tech-driven solutions can future-proof your business.