5 suggestions to win over management that compliance is essential

Jul 27th '22

With changing regulatory guidelines and escalating costs, proficiently taking care of compliance is a demanding task in the best of circumstances. The undertaking of thoroughly managing and alleviating your risk is made far more troublesome if you don’t have the assistance of your management team.


Here are 5 suggestions to really help communicate with management concerning the importance of compliance.

Today’s compliance professional is faced with progressively complicated and challenging requirements. As a compliance officer, you will have to decipher, generate, and execute policies and procedures that suit your company and business strategy. The useful resources allocated to the compliance projects do not always equal the growing demands.


Take, as an example,

Cross-border distribution, MIFID II, PSD II, IDD or PROD rules. If you’re like most of our friends and yours in the industry, preparing to adhere to these rules is eating away at a considerable amount of your time. It may demand additional hires, software applications, or resources to help manage. At the very least, it will be valuable if your management team realises the strain and demands of the new criteria and the effect it will have on your function and capacity.


Asking management for increased assistance, support, or more useful resources is virtually impossible if your leadership team does not have faith in the significance of compliance. If you fear discussions with your management team about compliance finances, staffing, or culture, this post is for you.


While it may be difficult, the positive aspects of properly convincing management that compliance is crucial far surpass the costs. Before anything else, possessing executive support will help enhance your culture of compliance. Their support and awareness will help you to establish the “tone from the top” attitude and strong compliance culture that regulators constantly look out for and demand. Second, the positioning will additionally keep it simpler to coordinate and prioritise compliance efforts and get necessary resources validated. Third, getting a supportive leadership team creates a huge difference in your own personal happiness at the office.


Let’s get started with those 5 approaches.


1. Put Yourself in Their Shoes & Enlighten With Empathy
The primary step to convincing management that compliance is essential is understanding the unique position that they operate in. As the management of your institution, the bottom line is a top priority. From that standpoint, compliance can appear like a pricey and even unwelcome hardship.


The reality is that great compliance is good business. Your first job is showing them why that’s right.


If your CEO, President or Board members believe that compliance is a cost centre, put yourself in their shoes and make an effort to understand the factors that contribute to this mindset. Some factors may be: annoyance with the total cost of compliance; shortage of understanding of regulatory scrutiny, tension, and regulatory environment; lack of awareness about the risks and repercussions of non-compliance; and pressure to grow sales and the impression that compliance is a disturbance from this goal.


Here are a few ways you can overcome each of these challenges:


If your leadership is irritated with the entire cost of compliance efforts, invest a few minutes to present them the ROI (return on investment) of compliance time and efforts. Break down a few of the top costs in your compliance budget, and show them the value they’re receiving for that cost.


Take it one step further, and indicate areas where resources may be allocated more efficiently.


Using clear numbers always helps! If you can demonstrate how you avoided risk exposure or enhanced efficiency in numerical terms, your leadership team is likely to respond well.
If your senior managers don’t understand the pressure of regulatory scrutiny, the most basic thing to do is show them regulatory guidance and articles about top trends in compliance. Try showing the some related FCA Final notices or fines as well.


Know your audience! Communicate with them in such a way they can understand, targeting the vital information they need to appreciate to make a decision or do their job more completely.
Use terms they’ll know; compliance professionals use jargon as well. All of us know how our audience reacts when we start using words like FCA, PRA, ICO, or FATCA. (That glazed look in their eyes says it all.).


Show that compliance is relevant to your community, including the press, social media and consumer advocacy groups.


If your senior management and Board aren’t accustomed to the potential risk and consequences of non-compliance, show them FCA enforcement actions and settlements that impacted institutions or individuals in positions similar to theirs.


Strive to explain how compliance risks are embedded into every individual role. For most people, the “ounce of prevention is worth a pound of cure” position makes sense. Other team members may respond better to the claim that compliance is a good asset protection policy.


In today’s environment it is important to assist them to understand that it is not just the organisation that may be liable, individuals may be called to account simultaneously.


It is a lot easier to discuss your view point if your audience can connect with your examples. Providing instances quite similar to your institution in order that you avoid this common reaction: “We’re not as big as XYZ, that will never happen here.”.


If your management is focused on sales, they might possibly not understand how good compliance can strengthen sales initiatives. Here is how it can:.


The renowned diplomat Daniele Varè is credited with claiming, “Diplomacy is the art of letting someone have your way.” As the compliance mind in your institution, you’re going to have to be diplomat, salesperson, conscience, educator, and more.


2. Open Lines of Communication.
Do your senior managers understand that you’re there for them, on the same team, and dedicated to assisting achieve your financial institution’s goals? Do they know your top priorities, your current challenges, and roadblocks to compliance success?


If not, your colleagues may need more information. The very best financial institutions to work for have a strong sense of collaboration and teamwork. Among the simplest tactics for boosting this sense of collaboration is opening lines of communication.


Ask your leadership team pertaining to their goals and priorities. As we move toward the end of the year, now is a great time to question next year’s priorities. In this conversation, you can also provide your own goals. Try to get more information about demands the Board and leadership team is facing.


Additionally, reveal a little more about what’s taking place in compliance land. Compliance is complicated. It would be impossible for a Compliance Officer to know everything about compliance; take into account how the other people in your institution must really feel about it! They are mostly very likely unaware of all the criteria or exactly how those requirements may impact them.


Your colleagues probably have questions and issues about compliance threats and their personal liabilities. Make sure they know you’re available to respond to those concerns and will communicate with them in a manner they will appreciate.


3. Show Why Compliance Matters for Growth, Making Use Of Real-World Examples.
It can seem counter-intuitive, but strong compliance management is vital for your financial institution’s growth. However, your leadership team may not understand that compliance initiatives promote growth.


Here are a few growth conditions by which compliance is much more than helpful, it’s essential:


Mergers and acquisitions.

Why? The risk of one institution will become the risk of each institutions. Say that your institution acquires another, and one of the branches in their structure has high disparities. The risk of that section is now your institution’s risk.


We’ve also found that compliance risk can stall M&A activity. It’s a good idea to start with compliance, so that you don’t go through the period of time, effort, energy, and resources of a merger or acquisition only to have it halted due to unexpected compliance issues.


Opening or closing branches.

When you change your branch or service network, you’re potentially impacting your performance. Compliance needs to get included in these discussions, so that they can help ascertain the probable impact of any changes to your network.


Improving marketing and sales efforts, and growing into new markets.

Your compliance analysis can offer clarity about potentially neglected marketing and sales opportunities. Your financial promotions and your website present the public face of your business. Making sure they’re compliant is absolutely crucial. Not least because, in an increasingly online world, they’re highly visible, not just to your customers, but also to the regulator. find out more here.


Again, good compliance is good business. Compliance should be included in growth strategy dialogues.


4. Share Compliance Risk Assessment Final Results & Goals.
A risk assessment is a necessary beginning for any financial institution to comprehend risk. Risk evaluations are also the root of any good Compliance Management Program. If you haven’t done a compliance risk assessment in the last twelve months, make that a top priority for the next quarter. Regulators’ expectations have evolved, and they now expect to see a risk assessment carried out every 12-18 months.


You need to know where your risks are to ensure that you can identify what needs your focus first. Prioritisation is key to your success. That’s why a risk assessment is so necessary.
Consumer protection is a top regulatory priority, so make sure that you’re evaluating your TCF, Conduct and other risk issues in the right forum and red-lining compliance risks specifically.
If you’ve conducted a risk assessment recently, have you shared the outputs with management? They need to become aware of the risks to ensure that they can see the areas of greatest need and help support your action plan. The high-priority compliance risks will most definitely need to be addressed in the short term. Be prepared to explain those risks and your plan for how to mitigate them.


5. Call for Support.
Sometimes you just need to call for help. Explain that without everyone on board, it’s hard (if not impossible) to have a practical compliance management program. It’s so important to have the right tone from the top!


Sometimes this may involve getting comfort from engaging an external compliance consultancy like “LS Consultancy” (call +44 (0) 20 8087 2377  or email us and get them to conduct a “Health-Check” or carry out a discrete project.


In PWC’s 2016 global State of Compliance survey, they found that “only 16% of respondents indicated their employees view the CEO as the compliance and ethics champion at their organisations.”


If employees see and hear that management supports compliance initiatives, they will be more probable to follow the lead. You may have to explain this to management, and request their support directly.


Show that if compliance is done effectively, it can protect personal and any financial institution assets and reputations, and help encourage growth.


Let’s face it, regulatory pressure on compliance isn’t going away. That means it’s our job as Compliance Leaders to help guide our teams and create a good Compliance Management Program that meets all our needs and make the organisation successful!


This post is created for compliance experts and management teams at financial institutions, and is designed to help persuade management of the relevance of compliance.


To obtain greater confidence, implement those compliance projects, perform those outstanding monitoring plan elements or just get regular experienced and qualified support for your business,

call us on +44 (0) 20 8087 2377  or email us.


If you want to get the right advice, quickly, with clear and totally transparent, unshackling yourself from the confines of an antiquated compliance support service, then contact us.


Contact us


About us

LS Consultancy are experts in Compliance, and work with a range of firms to assist with improving their documents, processes and systems to help mitigate risk.


Our range of innovative solutions can be tailored to suit your unique requirements, no matter whether you’re currently working from home, or are continuing to go into the office. Our services can be deployed individually or combined to form a broader solution to release your energies and focus on your clients.


Contact us today for a chat or send us an email to find out how we can support you in meeting your current and future compliance challenges with confidence.


Explore our full range today.


Contact us



Why Not Download our FREE Brochures! Click here.


Call Us Today on 020 8087 2377 or send us an email.


We welcome individual bloggers / Professional Writers / Freelancers to submit high quality contents. Find out more…


You can see our Google reviews here.


Contact us