This is the final episode of a 5-part podcast series with Tom Fox and the FCPA Compliance Report on Culture, Training, and Compliance. Listen to the series from the beginning.
One important aspect of training that is often overlooked in the compliance community is how it affects the bottom line. During times of economic stress, compliance training budgets are often tightened. This approach needs to be avoided. The reason is straightforward: investing in training and professional development for employees saves money in the long run, both operationally and when it comes to regulatory requirements.
An institution’s greatest asset is its employees, especially when they are entrusted with the responsibility of protecting the institution from risk. Providing employees with ongoing training that continuously refines their knowledge and skills will keep them engaged and incentivized to take compliance more seriously. Moreover, developing and retaining employees is beneficial to financial institutions in the long run and demonstrates sustainability within their compliance programs.
Rather than making cuts in training across the board, when fiduciary restraint is needed institutions should assess their training needs as they align with the greatest risk and find ways to deliver the most targeted and relevant training across the enterprise. Experts advocate several different styles of compliance training, striking a balance of online/in-person training, including independent or self-guided training, as well as hands-on training with an instructor.
Skilled and experienced employees are a critical part of a sustainable and effective program. When compliance officers look at their money spend for the year, they should remember that training is critical to proactively reducing compliance errors and risk. Additionally, employees who receive timely and engaging training often feel that an institution is investing in them and their professional growth, which can lead to less turnover. It demonstrates an institution appreciates the importance of career pathing and skills development.
Training should also assess the skills needed for each role and provide a career path for employees. Employees want to understand they are growing professionally. In turn, management desires that the people they have in those roles have the right training and are experienced. This means training is a resource bigger than what it looks like on paper. That’s why budget and resources for training is so important. Training is a way to mitigate risk within the institution.
In addition, regulators are more interested than ever in seeing that an institution is investing in a sustainable, scalable, and dynamic training program. They want to know that an institution understands its risks and demonstrates that with the training that is provided to their employees. Regulators expect to see more targeted and role-based training offerings and content that is evolving as the risks evolve.
Regulators are more focused than ever on how the financial institution is assessing compliance skills needed for critical roles and demonstrating that their employees meet the skill requirements for the roles that they are in. They also want to know that not only do compliance employees understand their institutions’ internal risk, policies/procedures, and escalation processes, but also that they are staying current with industry best practices and emerging risks.
This means a potential audit on areas as wide-ranging as how an institution provides career pathing, professional development, and cross-training opportunities for their employees. But this is much more than a myopic view of compliance training—this approach ensures sustainability while allowing for flexibility as financial institutions adapt to changes and face organizational or structural changes, as many do due to a host of issues ranging from regulatory remediation to right-sizing.