A common frame of reference for compliance officers is the guardians of policy and process. In 2021, the profession is so much more.
The International Compliance Association (ICA) is a professional membership and awarding body. ICA is the leading global provider of professional, certificated qualifications in anti-money laundering; governance, risk, and compliance; and financial crime prevention. ICA members are recognized globally for their commitment to best compliance practice and an enhanced professional reputation. To find out more, visit the ICA website.
Fragmented economies, shattered industries, restrictions on travel, greater access to mobile technology, global movements on climate change and diversity, Gen Z entrepreneurialism, the growth of the (largely) unregulated gig economy, remote work, and increased demand for purpose-driven brands are among the examples of seismic shifts for businesses that have either proliferated or emerged within the last 12 months.
In response, firms of all stripes must adapt and reimagine the value of influencing success, both within the organization and society. Remaining static is complacency and will be punished by the market.
Compliance is perfectly primed to adapt, with the ability to influence change in culture as part of integrated and innovative approaches to risk management. In today’s restless landscape, what is possible is being reassessed to create a highly valued compliance profession—one characterized by creativity, curiosity, and care.
Does that lend to compliance officers making good board members?
Notwithstanding the variance in public, private, and charitable groups and across industrial sectors, it’s possible to discern the characteristics of what a good board member might look like. Examples include:
- Being comfortable dealing with intangibles such as organizational politics, ethics, brand, reputation management, and handling the competing priorities of stakeholders. A successful board member will understand what enhances brand and destroys reputation. In 2021, diversity, inclusion, and equity remain pertinent areas for examination.
- Leadership, role modeling, and communication of the organization’s values and desired behaviors, as well as taking full accountability. This requires high levels of emotional intelligence and personal resilience.
- Collectively ensuring commercial viability of the business to achieve strategic goals through a balance of risk taking, governance, and problem solving as part of the executive team.
- Horizon scanning: The ability to assimilate complex business intelligence and make decisions based upon long timeframes and external factors within the operating environment.
If we begin with an open mind, it’s tempting to conclude that, given everything that has happened over the last year, there’s no reason why a compliance officer wouldn’t possess these qualities. Areas for development are likely to include commerciality, strategic thinking, and an emphasis on people over policy and practice.
There might be a natural (and understandable) tendency for compliance officers towards risk aversion. But this can be countered by understanding financial mechanisms and opportunities for growth. Equipped with insight on what governance is not required can be a valuable asset in designing agile and adaptable frameworks to unleash value rather than erode it.
Whether the aspirational role is chief compliance officer or a more commercially oriented chief risk officer partially depends on the organization and sector. The increasingly dynamic economy will create new opportunities that may reside in smaller and more entrepreneurial businesses. Either way, executive-level appointments for the reimagined compliance officer are becoming a reality.
The International Compliance Association is a sister company to Compliance Week. Both organizations are under the umbrella of Wilmington plc.
Jonathan Dempsey, MBA, is the director of Red Laces, a management consultancy unraveling the mystery and requirements of risk, safety, and compliance to empower business leaders toward success. Jonathan is a member of the ICA Panel, a body of leading industry thought leaders and subject matter experts who work in partnership with the ICA to support the compliance community.