Integrated platforms are the answer to new regulatory regimes

Organisations need to align their solutions with ever increasing regulatory demands, including integrating numerous data sets across their organisation. After a long history of flexible guidelines and poorly defined accountability trails, regulators are homing in on individual requirements and enforcing a more stringent framework for compliance.

This may be a significant adjustment for some firms who have historically had no regulatory processes, and therefore no supporting digital infrastructure, focused specifically on the individual. Now, organisations need to consider how best to accommodate these new demands.

How? Integrated regulatory solutions are revealing themselves as the answer.

A historically disparate approach

The approach to solution development has often been to procure a solution that meets specific needs as and when they arise. If an organisation discovers they need better visibility of training and competence, they will find a tool to address it. Then, if they want to streamline their assessments, firms will integrate another separate solution.

In short, digitisation has commonly been approached by adopting siloed solutions for siloed activities. The whole picture of digital infrastructure can get lost, which in the short-term isn’t always a problem, but can become one as time goes on.

HR and GRC solutions, used by a majority of financial services firms, are a good example of this in action.

GRC systems help meet the requirements around organisational risk, including tracking certain individual risk data points, while HR systems help manage people risk, including performance and learning and development processing.

Although this set up has historically been suitable for firms’ people-related compliance needs, the introduction of focused individual accountability regimes has now highlighted the disparity between these functionalities. On top of this, new requirements have been implemented which neither system addresses.

Changing regulation is calling for standardisation

Individual accountability regimes, and the rise of individual regulatory compliance as a domain, has clearly changed the way organisations manage their people’s compliance. Storing and monitoring individual-related activity across several different platforms introduces various challenges, outlined in more detail below.

In addition, regulators have also become more prescriptive about individual compliance requirements and the actions organisations must take to meet acceptable standards, as well as these being applicable to a larger population. For example, regulation now clearly outlines expected conduct standards that every individual within a financial services firm must meet.

Firms must ensure their own frameworks are aligned with the regional regulation, making the need for a centralised solution even more pressing.

Read more about the increasing focus on the 3 Cs here

Why disparate solutions create challenges

If organisations don’t adapt their solutions, integrating or introducing them in a more centralised platform that deals with all aspects of individual accountability, they will likely face the following challenges.

1. Data gaps and disparity 

Neither GRC nor HR systems accommodate for all the data requirements to meet individual regulatory compliance. This means firms have no single solution for recording, monitoring or reporting on all the relevant data needed to achieve compliance.

2. Manual data processes 

As a result of solution and data disparity, firms will need to manage how they monitor and evidence individual compliance manually.

This creates two primary challenges which many firms are likely already experiencing. Firstly, that data has not been maintained diligently and therefore isn’t up to scratch for regulators. Secondly, data has been maintained for a very specific purpose and therefore isn’t properly formatted or suitably comprehensive when viewed through the lens of individual accountability. Thirdly, operating manual processes increases both risk and costs associated with these activities.

3. Incorrect perspective 

Individual assessment has traditionally been viewed in the context of the organisation, which disparate tools facilitate. Rather than viewing individual related metrics as an assessment of the people themselves, they’re viewed as a metric for people risk within a firm.

Centralised solutions that focus on individual accountability introduce a different perspective, allowing firms to look at people’s data attributes and assess the human picture. For example, why an individual has failed their T&C, what actions individuals need to do to achieve something, or how trends arise across individuals. It allows firms to see the ‘why’ behind individual conduct, compliance, and performance, not just the ‘what’.

This is much more valuable when it comes to reducing risk and embedding a governance culture with your staff, across departments, legal entities or the entire organisation. Firms can’t hope to adhere to new regulatory frameworks until they see, and act on, people-related data from this perspective.

The benefits of a centralised platform

Trailight brings all elements of individual regulatory compliance together into a single platform to create holistic transparency over every data point or requirement that affects the individual.

Trailight connects traditionally siloed parts of an organisation. Integrating the people-related capabilities from HR and GRC solutions, alongside many more that neither solution addresses, the Trailight platform enables firms to look at the overall picture.

Firms can use it to not just manage and report on governance, but to drive conduct, culture and individual performance from the ground up.

This is essential for firms to meet the ongoing requirements of new individual accountability regimes. They can systemise their processes against these frameworks and therefore efficiently manage and demonstrate their compliance.

Discover more about the benefits of a centralised platform on our homepage.