Financial services companies are optimistic about their ability to keep up with new regulations as they take a 'big picture' business-focussed approach to the compliance challenge, according to new research conducted by Finextra on behalf of Computacenter and Sun Microsystems.
For the study, Finextra solicited the opinions of senior risk and compliance managers at 56 institutions on issues ranging from prioritisation and budgets through to the role of technology and external advisors in managing regulatory compliance.
Despite ongoing changes to existing regulations and the introduction of new legislation, the survey reveals that more than a quarter of organisations in the financial services industry believe they are fully compliant. Only two per cent of respondents admitted that they were uncertain of their ability to comply with the most important regulations, while the remaining 71% stated that projects were underway and that they would meet the deadlines.
Yet for all their confidence, a sizeable 39% of respondents admitted that their current IT infrastructure is doing a poor job or needs improving to support regulatory requirements, and nearly 60% say they are introducing new systems to help meet their compliance obligations.
As Peter Stafford, IS director at Bank of Ireland in the UK, observes: "Compliance with legal and regulatory frameworks is one of biggest challenges currently facing IT departments in the financial services industry. Technology has a massive role to play, and we have made a number of investments to help make compliance easier and less expensive. For example, we have deployed imaging and tools that facilitate the extraction of information from systems, and taken steps to ensure we have access to scalable management information databases."
This big picture approach in search of commonality across departments is firmly taking root. More than 80% of respondents cited that their organisations were looking for common areas when planning new compliance initiatives to avoid duplication of effort.
Ensuring compliance is no easy feat as the legal landscape is constantly changing, while new developments in data protection, risk management and outsourcing, can all impact the business.
Simon Gay, consultancy practice leader at Computacenter, comments: "Industry best practice is at the heart of much of the new legislation and regulations, and, as a result, compliance can deliver many more benefits than just keeping a company on the right side of the law. By combining compliance efforts with service improvement programmes, financial services companies can ensure that IT systems and processes, such as email archiving and disaster recovery, are also in line with the needs of the business."
Download a free copy of the full Finextra compliance report via the Finextra surveys and reports page.