How Advanced Technologies Can Increase Compliance Standards

by Francine Breckenridge, Chief Compliance and Legal Officer at U.S. Money Reserve

Photo by bongkarn thanyakij

Adopting advanced technologies for compliance is truly an evolve or die game. Here’s how taking the advanced-tech leap can help put your company ahead.

Technology can help improve the way any business works. It can streamline processes and help users assess large amounts of information in short periods of time. It can help track fast-moving regulations and events and keep employees securely connected when needed. In the same way that technology can be leveraged to create a faster, more nimble, and efficient business, it can also help with compliance.

Business compliance may appear to be the dinosaur in the office to many, with its seemingly archaic processes, paper contracts, and due diligence. While these tools have their place in the compliance world, a plethora of advanced technology exists that can help bolster the old-school methods. The truth is that robust compliance departments must be built on advanced technology in order to keep up with today’s changing world. After all, every c-suite executive expects to get the best, most intelligent information at lighting-quick speeds. Without leveraging advanced technology in compliance, your company risks missing critical changes in the space, which could lead to huge fines, legal action, and even jail time.

The rules are changing: Compliance must keep up.

Let’s face it: The regulatory landscape is changing incredibly quickly. In the last few years, major regulations like the European Union’s General Data Protection Regulation (GDPR) and California’s Consumer Privacy Act have had significant and wide-ranging effects on all kinds of companies. I’m not even talking about other rules and regulations like HIPAA, FACTA, PCI DSS, or any of the hundreds of other alphabet-soup-style rules and regulations that regulate niche businesses.

While these rules and regulations might not all have the bite of the law, violating any one of them, regardless of what business you are in, can have wide-ranging and expensive implications.

Yet the right advanced technology can significantly reduce any compliance risk your company may run, mainly by reducing the potential for regulatory breaches. For example, your company might require a compliance check for each blog post published or each document placed on a customer-facing server. Such work could become insurmountable if done by hand, so implementing technology that helps act as gatekeepers along each step of the way could ensure that your company avoids any potential violations. If you’re publishing large amounts of information or working with a large number of clients who need compliance checks before executing the next sequential step, implementing a smart advanced technology system can save manpower hours, as well as reduce potential losses in the form of penalties and fees.

Privacy breaches can kill: Advanced technology can help.

One of the major components of compliance is data management — particularly personal and private data management. If you’ve been paying attention to the news lately, you know that many major corporations have seen tremendous data breaches over the years.

The best way to prevent data and privacy breaches is to use advanced technology to store and secure sensitive and regulated data. Of course, it’s important to note that no technology out there is entirely secure against hackers, but an advanced system to track, manage, and secure sensitive data is required in order to operate in today’s business climate. If your company doesn’t have an advanced technology system handling your sensitive data, you are asking for serious trouble.

Business moves quickly: Compliance has to be faster.

At the heart of any successful business is profit. Without profit, companies disappear. For businesses to keep up, they must continually adapt and improvise to changing marketplaces, changing consumer demands, and changing economics. With all this change comes plenty of risk.

While most see the compliance function as a blocker to quick and agile business decisions, when engaged as a partner, compliance can help a business turn a profit more efficiently. By using advanced technology to automate everyday compliance tasks, companies can spend more time on the core tasks of their business and the desires of their customers. Automating some processes using advanced technology may also prevent duplication and manual reviews, allowing for more collaboration across all lines of the business.

Collaboration is king: Advanced technology can make compliance collaborative.

As I have written before, while compliance is often seen as preventive to succeeding as a business, when used correctly, it can help companies create new lines of business, improve profitability, and become more collaborative.

One statistic from a 2015 study by PricewaterhouseCoopers shows that companies with robust, comprehensive compliance plans are more likely to achieve an annual profit margin. In fact, said profit margin improves by as much as 10 percent over a period of three years. In highly competitive markets, that’s a considerable amount in a very short period of time.

As teams are dispersed all over the world to work remotely, how do companies implement comprehensive compliance strategies that bolster business and break down borders? Leverage advanced technologies. After all, technology doesn’t need time off. Companies can use advanced technology to jointly collaborate on documents or processes in real-time, and there’s no need to ship documents all over the world to wait for a signature or approval.

How bad could it be? Advanced technology can help compliance estimates.

While compliance is all about avoiding problems, they do happen. The rule of any disaster is to always be prepared for the worst. This is where advanced technology can really help.

Several advanced compliance technology systems on the market can run exposure risks and estimate business impact, which means that companies can be better prepared for the worst-case scenario. Like saving for a rainy day in your personal life, using advanced compliance technology can help a business stash cash for that just-in-case scenario.

Advanced technologies can also help your compliance team detect risks that the typical human could miss. That in and of itself can be an incredibly valuable business service.

As an example, consider the recent outbreak of COVID-19, or coronavirus. Compliance departments have been working overtime to figure out the best plan of attack to keep both employees and clients safe. Using advanced technologies to run scenarios could help teams make better decisions both for the safety of their employees and the long-term security of the business.

Keep track of your documents: Technology can improve recordkeeping.

Many compliance departments still rely heavily on paper trails and paper recordkeeping. While it’s old-school and in some cases more secure to keep records on paper, the future dictates that compliance departments step up their game and move into the digital age.

Advanced technology can help create digital audit trails that are searchable, secure, and compliant. Imagine rather than having to shuffle through file after file, a compliance department pulling documents and data trails quickly and efficiently with a few keystrokes.

Make better, faster decisions: Clear compliance standards can boost business.

I often use the analogy of traffic flow to explain how an excellent compliance plan and supporting technology systems can help improve compliance standards and bolster business. When the stoplights at a busy intersection go out, chaos ensues. When the lights are working, everyone knows what to do when, and there are fewer accidents, false starts, and mistakes made. Having a clear compliance plan in place is the same as having working stoplights — it helps the business make better decisions at a faster pace because there are clear rules of the road that everyone follows.

Knowing the rules of the road in your business provides employees with the confidence to know that they are moving in the right direction and that they are making decisions that are within the legal and legislative boundaries. By leveraging technology, you can not only make the compliance department more efficient, but also help business associates make faster, better, and more business-centric decisions.

The bottom line: Advanced technologies can increase compliance standards.

It almost goes without saying: Compliance departments need to leverage advanced technologies to keep pace with the speed of business. Advanced technologies can improve business outcomes, streamline processes, help reduce the risk of data breaches, help evaluate risks, and keep your company on top of changing rules and regulations. In turn, this can help increase compliance standards and improve the relationship between the business and compliance departments. Without technology to bolster compliance functions, your business could be left in the dust.

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