compliance culture

Posted By: Anonymous

compliance culture - 05/08/09 01:28 AM

Not trying to be stupid. How does one go about changing compliance culture? Isn't that up to the board and president?
Posted By: rlcarey

Re: compliance culture - 05/08/09 04:56 AM

Without their support it is an up river swim that is for sure.
Posted By: Anonymous

Re: compliance culture - 05/08/09 03:02 PM

What would you consider to be support? That seems to mean different things to different people. I really didn't want to be the compliance person at my bank. I was told that I would be given all the support I needed. Now I'm being told there are other things to do. I'm not sure how to get ahead of this, or if it is even possible.
Posted By: Anonymous

Re: compliance culture - 05/08/09 03:15 PM

If you are new to the position, education and training are key. Obtaining certifications are helpful and are recognized by the regulators favorably. Establishment of a Compliance Committee would also be helpful, if you are the only one at your bank to be in compliance. Also who you report to within the bank is key, the higher the better. These are just a few thing I did when I started out in compliance.
Posted By: Anonymous

Re: compliance culture - 05/08/09 09:08 PM

I realize that training is one way to become better acquainted with compliance, and I guess the president's approval of outside training would indicate support of compliance. I guess my problem is more that I feel I'm being expected to change the compliance culture, and I don't feel that is my job. I feel that I can contribute, but if executive management isn't going to provide support then as rlcarey stated, it is going to be an upstream battle. In my mind that means, expect cooperation from department managers, respond to request for information, expect managers to respond to audits, etc. These things weren't happening, I asked for the CEO's support and was told there were other things to do. I just can't figure out how to change compliance with zero help! I'm frustrated!

My question is how would you define management support?
Posted By: MagicCity

Re: compliance culture - 05/08/09 11:59 PM

I think Management support means that they let the rest of the bank know how important the function is, and hold them accountable for lapses in compliance.
In our bank the Market Managers are "graded" by the Compliance Officer on a quarterly basis and it affects their compensation.
In all our staff training the importance of compliance is stressed.
The support of management is the most basic requirement for your success. Without management validating your position, no one else will give it importance.
Posted By: Anonymous

Re: compliance culture - 05/11/09 02:52 PM

Magic City - I completely agree with what you are saying. However, the actions need to match the words. If management states that they support compliance and then do nothing that demonstrates that support the compliance culture won't change.
Posted By: MagicCity

Re: compliance culture - 05/11/09 04:29 PM

That's right.
The actions have to match the words, and there has to be accountability.
Posted By: Richard Insley

Re: compliance culture - 05/12/09 01:45 PM

Anon- You are in a difficult, but very familiar, position. Corporate culture is "the way it is" in all companies, and you are correct to recognize that only the CEO can make it change. Regulations are costly and get in the way of doing business, so executives hate them. Your job is to encourage low-risk banking practices and find ways to hold down the cost and inconvenience of regulatory compliance.

CEOs are always busy, but not stupid. Yours understands the need to keep regulators under control & looks to you for guidance. S/he will respond to a careful analysis of the regulatory risks and staff attitudes that need changing and will be thankful for diplomatic solutions--especially those you can handle. Horror stories from other banks always help when selling the idea that regulatory control is good for business.

Examine your relationship with the business managers. If they view "compliance" as a 4-letter word, get rid of it! Years ago, my business managers wanted to paste the "C" word on anything possible and then dump it into my department--where it wouldn't hit their budget or take their staff's time. Since the "C" word had such negative connotations, I got rid of it and renamed my function "Regulatory Management." A name change and rewrite of your job description is something you can engineer & your CEO merely approves.

As I studied what needed to change and why, I realized that I should own a few of the hottest hot button items, but that lots of other stuff was really a QC function that they should own.

Normally, new responsibilities mean unbudgeted costs, and nothing gets a business manager's attention faster than unbudgeted expenses. This is where your CEO can wave the magic wand and with a single nod or signature approve whole or partial positions within businesses engaged in highly regulated activities. Everybody wins. Managers get to control their destiny (no more surprises) and your time is freed to look for those ways to hold down the cost and inconvenience of regulatory compliance.