Regulatory change is accelerating. As industries grapple with new technologies and digital transformation, compliance teams face the monumental task of keeping up with the regulatory requirements. Modern business has become an integrated web of supply chains and third-party partnerships. While such evolutions are expected as markets change, the pervasiveness of these relatively young developments and the speed at which they influence the modern economy leaves regulators and compliance teams alike racing to address new forms of risk.
Addressing the Difficulties of Regulatory Change Management
Compliance teams encounter significant challenges, with risk management being their most significant hurdle. Furthermore, complying with the pace of regulatory change and the costs associated with it is also a significant concern. This begs the question: How can teams keep up with the ever-evolving demands of emerging technologies and regulators racing to address them?
As the adoption of digital technology has increased, all the way down to the consumer level, the tools organizations use to operate and the products and services they offer must also evolve. However, regulating this technology is difficult, as it requires a high level of expertise. As soon as vulnerabilities and uses are satisfactorily addressed, new threats can emerge. A regulatory change management process in today’s dynamic environment needs to be:
Characteristics of a Robust Regulatory Change Management Process
- Effective. To effectively manage regulatory change, organizations need to prioritize understanding changing requirements and their impact on the organization. This proactive approach allows for good compliance practices and demonstrates a commitment to regulatory compliance. This allows the organization to demonstrate good compliance practices to regulators and officials.
- Efficient. Optimizing resources is also crucial to efficiently managing regulatory change as the business and regulatory landscape evolves.
- Agile. Agility is key in a dynamic regulatory environment. Organizations need to develop strategies to quickly adapt to regulatory changes and remain responsive to developments in the landscape.
Regulators and compliance teams must continually address issues at the micro level in today’s fast-paced environment. Regulators are shifting to an agile sprint cycle-focused paradigm, but incomplete or conflicting requirements can result from high volume and complexity. Compliance teams often struggle to meet regulatory requirements or obtain complete guidance. Managing risk and keeping up with regulatory change can leave compliance teams on the back foot as the organization adopts new technologies and operations.
Benefits of Collaborative Compliance and Regulatory Technology Architecture
Change can be punishing for those who cannot respond adequately. Compliance teams can integrate the agile nature of their work into their strategy and add value amidst the chaos. Digital transformation presents new tools and opportunities for addressing these challenges. Automated document control systems preserve the integrity of policy and procedure documents while simplifying their authoring and deployment, making them more accessible and up-to-date.
It is paramount that organizations address compliance in today’s dynamic business environment with agility and efficiency.
The benefits of an integrated and collaborative technology architecture are:
Eliminates cumbersome and redundant manual processes. Compliance continues to grow its complexity and back-office professionals must analyze high volumes of incoming data and information manually to maintain compliance and keep up with constant change. This often results in things getting missed and potential manipulation.
Keeps pace with the continuous barrage of changing regulations. The regulatory landscape continues to grow, and nobody sees any signs of stopping. Organizations need an automated system that helps track this overwhelming change volume.
·Allows the organization to free up misallocated resources to respond to and monitor emerging compliance risks and build on the organization’s operations by providing strategic insights into the business and its risks.
Components of Regulatory Change Management
To effectively manage regulatory changes and emerging risks in a dynamic business environment, organizations need an active system. They must develop a cohesive process that includes gathering and analyzing relevant information and assessing its potential impact. The current high volume of regulatory changes requires a new approach as the old ways of uncoordinated change processes are no longer effective. Developing a regulatory repository, assigning accountability, conducting regulatory impact studies, and implementing a change management program to monitor and alert the organization of risk conditions is critical. This program also fosters collaboration among stakeholders to address and manage the impact of changes on the organization.
Compliance teams can use software solutions to manage third-party relationships, deploy vendor surveys, track obligations, and visualize risk data. These tools leverage available resources but the true value lies in their ability to respond quickly and effectively to change. The pace of change won’t slow, so the most prepared teams thrive. Organizations must foster collaboration, accountability, and integration between regulatory change management, information, data, and a GRC architecture to achieve this.
Organizations need to develop an integrated, agile, and collaborative compliance program and framework like VComply – built on common information architecture and framework. VComply’s system and compliance architecture allows for compliance, risk management, and assessment activities to be coordinated across different departments and functions of the organization, assisting the organization in breaking silos and making more informed business decisions.