How Compliance and Risk Technology Empowers the Board

Risk and compliance technology is mainly utilized by the risk and compliance experts within the organization. The advantages the technology provides to the board often get lost in all the talk about how technology changes the way risk and compliance teams work. It changes the relationship between the board and risk and compliance and enables them to directly interact with the risk and compliance management frameworks as needed.

Breaking the Wall

The executive decision-makers of the bank or financial institution have the right to look at risk and compliance management processes. The problem is that there is a wall between them and the risk and compliance management frameworks that prevent them from being able to intervene. This wall is created by the many obstacles and complexities involved in risk and compliance. The board of the bank depends on the risk and compliance teams for all updates and notifications. Any time they want to know more about risk or compliance performance they must ask the risk and compliance teams to create reports about risk and compliance issues.

Risk and compliance management technology breaks this wall completely by empowering the board members with risk and compliance insights and information.

Executive Visibility

The most profound change occurs in risk and compliance reporting. When risk and compliance are handled manually, periodic reports created by the risk and compliance teams are the only source of information for the board members. Risk and compliance technology provides them with real-time executive dashboards that display essential risk and compliance metrics. While previously they would only hear about issues and problems in the periodic meetings, they now can check the performance levels and issues in risk and compliance whenever they want to.

This visibility increases risk and compliance accountability across the organization. It also ensures that the board has all the risk and compliance information it needs to make critical strategic decisions about the bank’s or financial institution’s future.

Quantifiable Performance

Risk and compliance technology also increases the board’s ability to measure the performance of risk and compliance within the organization. Since all the risk and compliance work is centralized into one platform, it is easy to access metrics related to risk and compliance performance. Performance tracking is extremely limited when risk and compliance are managed manually. Most businesses will only have tracking data for the number of risk and compliance issues the business faced. While this does give an overall idea about risk management and compliance levels across the organization, the metric is still very limited in providing insights about risk and compliance performance.

Risk and compliance performance cannot be tracked by simply tracking the number of risk and compliance issues because the issues depend on market risks and the regulatory framework. The current pandemic is a good example – it created many new risks, and businesses had to focus on compliance while employees could often not work from the office. This meant increased risk and compliance issues, but it does not mean that risk and compliance teams did not perform adequately. In reality, they had to work harder than during normal times due to the increased workloads.

The type of metrics that can be tracked through risk and compliance management solutions provide better insights into organizational performance. Businesses can look at how much time each compliance or risk issue took to be resolved. Managers can see how long it took them to discover an issue from when it was created. This kind of nuanced visibility allows the organization to fine-tune its risk and compliance performance by unearthing vulnerabilities and inefficient processes in the risk and compliance framework.

Enhanced Accountability

The increased visibility and better performance insights also increase accountability throughout the organization. Each risk and compliance issue has an assigned owner. Each stakeholder in the organization knows which risks affect which compliance issues. This gives the employees an in-depth understanding of how the different cogs and gears in the risk and compliance performance interact with each other. Risk and compliance platforms are similar to wristwatches with transparent back lids that allow the wearer a peek into the clock’s intricate mechanisms. The platform makes the complex mechanisms and relationships between risks, compliance requirements, documents, and processes visible.

Interested in seeing how your organization can increase the control it has over risk and compliance issues? Predict360 is endorsed by the American Bankers Association for risk and compliance performance. The Predict360 risk and compliance intelligence suite can deliver unparalleled risk and compliance performance from the cloud. Get in touch with our risk and compliance experts to demo what the solution can do for your organization.