Since the pandemic took hold, I have written about my expectations of the new norm including more remote working, an increase in investment in automation, a reduction in the use of cash and more robust contingency planning to protect organisations from future crises.
As we know, over the past few years, regulatory compliance has been steadily rising, with regulation tightening not just in the UK and Europe, but across the world.
During COVID-19, the Financial Conduct Authority (FCA) has relaxed its regulations for financial firms by easing best execution reporting requirements and extending financial reporting deadlines. However, a lot of my network from the Financial Services sector is anticipating even more regulatory scrutiny and compliance in the new norm.
During the outbreak, compliance teams have had to adapt quickly to the new realities of working from home, and the challenges they have faced particularly when people have been unable to work due to illness. Smaller firms have been more susceptible to breaches in regulation due to key members of staff falling ill or being furloughed.
Manual processes are difficult to maintain at the best of times. These limitations to current processes have been magnified during COVID-19 and have highlighted the need for enhanced online systems and secure, cloud-based technology so compliance work can continue without interruption.
Services that are automated, with cost-effective advantages, are going to be of incredible value to most firms to help relieve the regulatory burden. The more they can automate, or outsource, the more protected they will be, mitigating the risk of fines from regulatory breaches.
Compliance is important. Firms will be very aware that an economic downturn will not be an excuse for any breach. As COVID-19 has highlighted weaknesses in process, is it also likely we will see regulatory changes implemented to business continuity planning and standards to address these?