MyComplianceOffice Blog

Employees at all levels of the organization make decisions that impact compliance every single day. To ensure that those decisions are wise ones, employees need to understand where they fit into the organization. If there's not a shared understanding of roles and responsibilities supported by controls and accountability there's a risk of chaotic compliance—and a chaotic culture across the firm.

If the first stage of a pragmatic Know Your Obligations strategy is deconstructing and understanding compliance obligations to define where you need to keep your focus, the next step is mapping policies, procedures and controls to performance indicators to be able to accurately assure compliance.

Essentially, at this stage, we need to answer the question: What do we actually need to monitor?

Regulations, frameworks, policies and controls define the day-to-day of the Chief Compliance Officer (CCO) and their teams. It’s fair to say that it is an important yet often troublesome undertaking to make sense of what can often be described as monitoring spaghetti. At the same time, the teams also need to ensure they are keeping senior execs and the Front Office engaged and compliant.

So how can the CCO set regulatory priorities, identify policy and procedure gaps and understand compliance obligations?

The United States Securities and Exchange Commission's Division of Examinations  Risk Alert: Observations from Examinations of Newly-Registered Advisers covers the regulator’s typical focus areas and common observations. The Alert warns newly-registered advisers to pay close attention to the firm’s compliance policies and procedures, disclosures and marketing practices – advice that well-established firms should be heeding as well.

If you’re in Compliance, you know the crucial role that the Chief Compliance Officer plays in helping to maintain integrity in the securities industry and preventing violations. CCOs’ jobs are challenging enough given the wide range of obstacles they face day to day without having to routinely worry about whether simply carrying out their responsibilities will subject them to personal liability.