Australian companies mustn’t take their eye off compliance even amid a global crisis, says new industry report released today by Australian technology services firm, TAS. TAS’ fourth annual Compliance Index, Change, Complexity and Current State of Play, finds that compliance, along with security breaches, are the top two significant risks facing businesses.  

The Index’s findings suggest that business leaders still have work to do when it comes to ensuring effective compliance management. Despite growing awareness of compliance within Australian boardrooms, leaders are grappling with ‘how’ to foster a compliance-first culture in the workplace. Over a quarter of survey respondents have either no knowledge or only a basic level of understanding of compliance obligations. Further, 64 per cent of Index participants estimate that staff spend as little as 0 and 2 days on training annually, potentially exposing companies and customers to increased risk from lack of knowledge and skills.  

According to the findings, some of the most significant challenges leaders face are constraints in resources, skills capability and a lack of strategic partnerships. This builds on the findings from 2019’s Index highlighting the existence of the same barriers and continuing trend non-effective compliance management.  

At the same time, the Index found that leaders are still not considering strategic partnerships with RegTechs to address those barriers. While most organisations have worked with an external partner at some point to identify their compliance obligations or assist in some way, very few are actively engaging partners to manage their end-to-end compliance obligations, and many organisations have done neither. 

Shane Baker, CEO of TAS said, “With compliance costs growing, and organisations identifying time and resources as significant barriers, leaders must open themselves to innovative ways to address the compliance challenge. 

“While risk and compliance are clearly on the agenda, there is still work to do in moving the compliance conversation forward. As the Index reveals, compliance must be viewed as a business imperative and must be fully embraced and visible across the organisation. Strategic partnerships, smart and intuitive technology, and the use of data and analytics will help navigate the compliance landscape.”   

The Index outlines a blueprint for the future and identifies opportunities for leaders to consider. This includes developing a compliance-first culture at all levels of the organisation, to investing in the right tools and training to empower people. For example, 40 per cent of surveyed leaders are unsure of their compliance-related expenditure and therefore are not focusing on the how to manage compliance. Leaders can prioritise and manage compliance as well as other risks from data breaches and regulatory complexities by proactively addressing gaps across the board. 

Julian Fenwick, Founding Director, the RegTech Association commented, “While Australian RegTech solutions are viewed as some of the best in the world, leaders should put aside their risk-averse tendencies and seek partnerships. Leaders should empower all staff with both training and tools to be responsible for compliance and work strategically with the right solutions and RegTech partners to achieve compliance. By championing a compliance-first culture, organisations can meet their obligations and ensure their customers are protected now and in the future.”  

About the Compliance Index: TAS initiated the Compliance Index in 2017 to canvass the challenges and opportunities Australian companies are facing in the areas of compliance, regulation, technology and talent. Now in its fourth year, the Index draws on responses gathered from C-level executives employed across banking, finance, insurance, superannuation and IT, with the aim of providing a timely and relevant snapshot and pulse check of the latest compliance trends and strategies. A full copy of the 2020 report is available at http://tas.business/work/the-compliance-index/.