Risk & Compliance: A Recap of Our Webinar

Risk Compliance Transcript

Another month, another successful webinar.

Last week, we hosted webinar número dos of our yearly series where we discussed the risk and compliance functions and how they will evolve or altogether transform themselves post-COVID and well into the future.

A special shout out to our panelists, Dr. Peter Wilson of PB First Global Tax Advisors in Dubai, Socrates Coudounaris of Reinsurance Group America in London, and Samantha Sheen of Ex Ante Advisory Limited also in London, for regaling us with all of their knowledge (and strong opinions) on this subject.

Thank you too to Adonis Pegasiou of EIMF in Cyprus for moderating this session.

In case you couldn’t make it to the live session, we’ve got plenty of options for you.

Please feel free to view the entire webinar on demand or check out the full transcript below.

We now leave you with a few of the event’s main highlights!

Will COVID-19 forever change risk management in the financial services sector?

Socrates CoudounarisSocrates Coudounaris: “COVID has actually tested the strength of the relationships in all the functions in a financial services organization, all the way from the Board to the Chief Risk Officer, the compliance functions, the executive teams, all the way down to the first line staff, and it’s a good news story mostly. Risk management has continued to be a consistent and critical friend and stepped up since March 2020 when all this kicked off last year…So we all left our offices…and started working from home, and most of us are still doing exactly the same thing, but I think what has changed and what is the success story is that direct and open line of communication. So, as you know, risk management is a second line oversight function working with the first line, being that collaborative, critical friend and stepping up and figuring out what are those critical risks that people are facing, as well as the remoteness from working from home. The good news is we were prepared, we have business continuity plans in place, disaster recovery, and we’ve trained for this. But we’ve never trained for it lasting for 12 months ongoing. So it’s a good success story.”

Do you think COVID-19 and the pandemic can be seen as a driving force for some sort of technological revolution and a shift to using more IT than we’re used to?

Peter WilsonPeter Wilson: “One area is the amazing software system that goes with the automatic exchange of information, whereby there’s one model basically, one model of software and 150 or 160 countries in the world that have signed up to the automatic exchange of information, they receive the reports from their financial institutions and it’s fed into that country’s software system, which is the same as all the other 150 or 160 countries use. And through the press of a button the information moves to the other countries. And if I remember correctly there was a publication last year, I think, that said that the UK on the 30th of September last year received its inflow of automatic exchange of information almost simultaneously from over 100 countries. So this software was coming in any event but I believe its usage has been accelerated through the pandemic.”

Do you think that supervisors are ready to check the technically complex systems of companies? How will remote work and the work from home movement affect the company’s compliance obligations?

Samantha Sheen: “I’m going to be controversial and say, as a former regulator, I don’t need to have the technical know-how to check your system. Speaking as a regulator, my attitude would be: ‘I don’t need to be an IT expert, I do not need to have the same level of knowledge as your engineers because the problem is with you, if you can’t explain to me in plain simple language how your controls work and if you can’t demonstrate how they’re effective, then you’re not doing your job properly.’ And people struggle with this, they think somehow the supervisors have to be technologically fantastic and some of them are without a doubt, some of them are very competent. But the issue is you made the decision to use the technology, it’s your responsibility to evidence that it works the way you expected it to. “

“And it’s the same thing with working from home. Regulators generally have no problem with people working from home except if you can’t explain how people are not breaking through controls, messing documents, putting false information into reviews, people who go offline and you can’t find them for hours, you’re not sure what they’re doing, if they’re doing something, they’re not downloading stuff into their personal laptops, etc. Those are things a regulator will expect you to have already thought about when you sent those laptops to your staff last March and if you haven’t already thought about those things, you’re already on the back foot anyways. So I think those questions, sometimes people need to look at it differently. You’re the one who bears the responsibility, not your regulator so to speak.”

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