Post By: David Rowland, CTO at StarCompliance
Do you really have a culture of compliance? Here’s how to measure user adoption of your compliance software platform among your employees
For compliance officers, creating a culture of compliance is about more than persuading employees to trudge reluctantly through day-to-day compliance tasks. It’s about getting them motivated to participate in helping the firm limit its risk. To do this, compliance teams must track how well employees adhere to compliance programs. Happily, good compliance software comes with tracking capabilities: to pinpoint which users need an extra push when it comes to adoption.
Although there’s no regulation that provides directives for tracking software usage, it’s an unspoken rule that compliance teams need a thorough audit trail and an historical view of activities. If you’re not taking responsibility for compliance tracking and reporting, or ensuring all team members are using the appropriate software properly, how can you fully guarantee you’re mitigating risk to the best of your firm’s ability?
DRIVING USER ADOPTION WITH THE RIGHT SOFTWARE
Of course, not all compliance software is created equal, and financial institutions can struggle to find the right technology solutions to support creating a culture of compliance. Here are some features to look for when thinking about implementing a compliance software platform:
- Plug-and-play reporting — This allows compliance officers to run reports against any data in the system.
- Graphical elements —Look for software that allows you to pull together data in both detailed table reports and helpful visual representations, such as charts and graphs.
- Numerous exportable formats — Compliance software tools that don’t enable the exporting of reports into editable file formats—such as Excel and PDF—can create hurdles for compliance officers looking to do deeper analysis.
- Report presentations — Look for software that allows you to build out report presentations, pulling together pages into collated documents that can be scheduled for delivery to specific stakeholders at predetermined times.
This level of compliance tracking and reporting can provide insights into progress toward particular events. If, for example, your firm kicks off a certification period for two weeks, the right platform can give you a view of the day-to-day progress and help you quickly identify those employees who may need an extra nudge.
You might notice that a particular office or business line continuously yields low completion rates. By taking a closer look at the data, you might be able to figure out why. Is it during periods when this team or office is particularly busy? What if you moved the next certification up two weeks; would that change the completion rate? With the ability to easily analyze data and find patterns, you can identify other techniques or make changes to your process that could promote better software user adoption.
HOW TO MEASURE USER ADOPTION OF SOFTWARE
As you view reports and analyze activity, a few key metrics will give you the best insight into software user adoption rates among employees:
- Completion rates for certifications and attestations
The certification module is a flexible component within the application where you can generate periodic requests for employees to certify or attest to an activity. Let’s say you need employees to read the new employee handbook. The platform could send a request to complete this task by a certain date and then monitor and capture data around the number of responses, reminder emails, and so on. From this information, compliance officers can start identifying patterns and pockets of individuals who may need additional prompting to complete compliance tasks. - Pre-approval levels for trades and gifts and entertainment
Compliance tracking and reportingof pre-approvals is especially important during new compliance software implementation, as this is the period in which employees are forming habits that will be harder to modify down the line. Perhaps an employee was submitting personal trade requests each week before implementation. After implementation, however, the requests are coming in only once a month.
Does this mean the employee has slowed down for personal reasons? Or could they no longer be following procedure by logging into the system to pre-clear their activity? This change in habit could indicate a software adoption issue: one that could open your firm up to significant risk. The same would be true of other personal activities, or gift-and-entertainment requests. By identifying changes in patterns more quickly, you can get ahead of potential risks and strengthen potential software adoption gaps before they lead to anything serious.
- Reporting rates of potential deal information
As bankers form relationships with clients for IPOs, mergers and acquisitions, and other potential deals, they’ll gain access to material non-public information (MNPI). It’s their responsibility to report these engagements to the compliance control room in a timely fashion, so that compliance officers can do their due diligence and add those companies to the firm’s watchlist.
Proper compliance tracking and reporting allows compliance teams to compare the entry date of the potential deal with the corroborating paperwork to determine whether the banker was timely in her reporting. Any disparity between when the banker reported the engagement and when it actually occurred would suggest that adoption of the compliance platform isn’t as strong as it could be and, in the worst-case scenario, could indicate that securities laws have been violated.
Compliance is all about mitigating risk. If software user adoption rates are low, the chances of missing something grow exponentially. The right compliance software tools ensure proper tracking and reporting and can help lay the groundwork for creating a strong culture of compliance throughout your organization.