Understanding the modern compliance manager

  • February 22, 2019
 

We interviewed George McNaughton, an experienced Head of Compliance within the financial sector, to find out more about the challenges of being a modern compliance leader.

 

Could you tell us about your background and journey to becoming a Head of Compliance?

My background is in retail banking and financial services, initially in operational roles and latterly moving to compliance. Several of my operational roles, particularly at managerial level, had compliance or quality management responsibilities which led to an interest in taking this interest to the next level.

How do you define the value that a risk and compliance manager brings to their organisation?

A risk and compliance manager can bring an independent point of view to a project or the overall business. You can see the value or benefit that a project or process looks to deliver for the business and layer risk management and compliance requirements on top to try to deliver the best solution that meets the business needs.

How would you define the current state of risk management and compliance?

The importance of the risk management and compliance function is ever growing. Regulators are increasingly putting the onus on businesses to be self-policing with significant consequences both at business and individual level for failure to implement adequate systems and controls.

What are the main challenges that you face as a Head of Compliance within the consumer credit space?

Pace of change, growing influence of technology resulting in new, innovative products and services, and globalisation of the market. These challenges are interconnected. Consumers have changed the way they wish to engage with their financial services providers and the products they use, as evidenced in the scale of bank branch closures due to reduced footfall. Financial service providers have recognised the need to innovate and leverage the benefits of technology to help drive results, increase customer satisfaction, and manage costs. All of these changes when combined demand that regulatory requirements are regularly reviewed and revised to ensure they remain relevant and fit for purpose.

Do you think there a defined set of skills or attributes that make for a successful modern risk and compliance manager?

Yes, the modern risk and compliance manager must be a business enabler that engages openly with the business to find suitable solutions and encourages collaboration from colleagues.

How do you ensure that you stay up to date with the latest regulatory and/or technological developments?

This one is definitely a challenge as there is no simple solution. A broad range of activities and resources are important, such as alerts on relevant topics (lexology.com is a good source), notifications from some of the larger corporate firms and the ICA, regular review of regulator websites, and attendance at industry seminars. It is important to make time in your busy schedule to try to keep up-to-date and to consider the impact of developments for your firm.

What do you think new risk managers would be most surprised to find out about the role of a Head of Compliance?

The range of questions you can be asked keeps the job interesting and challenging. In a smaller business the risk and compliance function should operate across the whole business so in any day you could be considering questions or issues in IT, Operations, Marketing, etc.

What are your priorities as a Head of Compliance?

To support the business to achieve its objectives whilst ensuring risks are considered and managed and compliance is endemic in the processes.

In what ways have you seen the role of a risk and compliance manager change over the last 10 years, and how much has regulation played a role in this?

In the past the risk and compliance manager was seen as the person who told you what you couldn’t do or got involved when things went wrong whereas now they are much more engaged in business processes and seen as a resource to help the business strive to get it right from the outset.

What are your main concerns for the future?

That regulators continue to strike a balance between allowing business and enterprise to flourish whilst recognising the requirement for regulation and protection for consumers and other stakeholders.

How do you see the role of a risk and compliance manager evolving from here?

The role of the risk and compliance manager will continue to grow as a key business hire, someone who can support a business to build its reputation as an ethical operator and in turn contribute to the profitable trading of the business.

Are there any other interesting perspectives you’d like to add?

I hope people continue to see risk and compliance as a career choice where they can positively influence business results. A background in other business disciplines will help your perspective to consider the task at hand and guide the business to the right outcome.

Thank you George!

George McNaughton is a compliance professional with over 25 years experience in the financial sectors, having held a number of management positions in operational and compliance roles across a wide range of retail lending products. George recently joined Sharein Ltd as Head of Compliance and is based in Edinburgh.

Find George on LinkedIn.

 

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