It’s almost too easy for compliance to be looked at as the bearer of all things bad news. After all, if you’re hearing from your compliance team it’s likely because you’ve forgotten to fill out a certification or, even worse, there has been an issue of noncompliance. However, that perspective doesn’t take into account the very real benefits compliance provides to the entire firm.
In this blog, we’ll break down why an effective regulatory compliance program is beneficial not just to your chief compliance officer, but to your entire financial advisory firm, public or private company or financial institution.
The benefits of an effective regulatory compliance program for your financial institution
While the obvious benefits of an effective regulatory compliance program have been spoken about at length – avoiding Securities and Exchange Commission (SEC) or Financial Industry Regulatory Authority (FINRA) fines and penalties and protecting your firm and its clients from potential threats like cyber-attacks – the specific, departmental benefits have not been explored in much detail.
Sales
As a sales professional, your goal is clear: attract new customers and beat out the competition. One of the best ways to lose a potential sale? The reputational damage which comes from a breach in compliance. With an effective compliance program, you can illustrate the thoroughness of your firm in:
- Protecting against risk points
- Putting the best interest of your clients first.
- Keeping your client’s sensitive information safe.
Marketing
Like sales, marketing’s functionality is to grow brand awareness and increase new and existing business. A task which is much easier to do when you have the backing of an effective compliance program, showcasing your financial institution’s dedication to client protection and market integrity.
Customer service
Your customer service team handles hundreds of calls and emails daily, answering critical questions and keeping your customers happy. A breach in compliance is not something a customer service representative wants to relay to clients. By effectively mitigating risk, you help your team avoid that uncomfortable conversation.
Executive and board
If your firm is backed by private equity, you will need to prove the effectiveness of your compliance program to attract new investors and retain existing ones. In this case, the conflicts which can arise should a violation of compliance occur will not only impact your reputation, but it could also lose you critical investment dollars.
An effective regulatory compliance program is a necessity for any functioning financial institution; however, the benefits reach further than just your compliance team, impacting the day-to-day jobs of every firm employee.