Compliance has a PR problem.
During countless industry events and conversations with our customers around the world, I’ve heard the same laments time and again:
- “Our team is seen as the ‘team of no.'”
- “We’re basically the company cops.”
- And one particularly insidious refrain: “Compliance is a cost center.”
You might be fully aware of the business value your team provides, but that doesn’t mean much if your stakeholders see you as a brick wall—and worse, a brick wall that continually bleeds money without contributing to the bottom line.
It sounds like it’s time for a compliance makeover. Fortunately, there’s a movement afoot to reframe compliance as innovators and protectors, rather than punishers and staid box-checkers.
Compliance as Revenue Protection
When Convercent’s Chief Strategy Officer Philip Winterburn moderated a panel at Compliance Week called “Compliance Teams are Essential Workers” this May, one particular comment piqued my interest.
“Traditionally compliance is viewed as a cost center, but in reality, it’s a ‘Revenue Protection Center,’” said panelist Tiffany Archer, Regional Compliance Officer, Corporate Counsel (Americas & Europe) at Panasonic Avionics Corporation.
Interesting, I thought. Could this be the start of the PR makeover that compliance needs? Time to learn more. So I reached out to Tiffany for more insight on how Compliance Officers like her can re-position their work in the eyes of stakeholders.
Overcome the cost center myth with a seat at the table
If you’re absent from the big conversations, you’re unlikely to convince anyone of your team’s value. And more importantly, you won’t have the insight you need to craft a compelling message to counteract the compliance as cost center myth. “Compliance needs to have a seat at the table to have visibility into challenges the company is facing, strategies the company is looking into pursuing, etc.,” says Tiffany. “Having that visibility and exposure, [you] can now leverage technology to take all your data and turn it into a story that resonates with leadership.”
If you’ve been excluded from the table up until this point, it can seem impossible to elbow your way in—but the secret is in changing how you communicate. Leaders don’t want to hear about roadblocks unless you can follow up with a solution or proof of past results. “In order to be able to make meaningful decisions, compliance can’t be perceived as police, or obstructionists,” says Tiffany. “Offering positive outcomes can really justify the seat at the table.”
Plus, if you’re present in strategy meetings and other leadership settings, you’ll be able to contribute regulatory guidance and risk insight at the outset of major company initiatives, saving time and money up front versus tacking compliance on as an afterthought when projects are already underway. That’s a meaningful step toward demonstrating that compliance can function as revenue protection.
Collaboration is key
Another secret to getting that seat at the table? Collaboration—especially with teams that your bosses already trust to get the job done. After all, your insight into regulatory issues and risk is every bit as essential as other functions, and you’ll have a much easier path forward if you have a few allies at your side. This might require you to change the way you interface with your colleagues—think less “no, you can’t do that,” (remember, you’re trying to move away from the “company cop” role) and more “how can I help us achieve this goal ethically?”
“Try collaborating with other key functions who are already known to help steer the company along the course (audit, finance, etc),” suggests Tiffany. “They’re key players in the game, and in order to have an impact, compliance needs to be there to hear what’s happening and to offer insights and guidance that the organization needs.”
Collaborating and having a voice isn’t just a win for you and your team; it’s also a boon to the bottom line. When you and your cross-functional cohorts can convince company leadership that each function provides an essential viewpoint, everybody wins.
“It’s so important to embrace collaboration. When you have more stakeholders at the table and you’re talking more openly about challenges and risk and business opportunities and expansion and mergers, you want someone from each function to lend their view on how best to move forward,” Tiffany says. “When you have that kind of synergy and the leader can take all of that, synthesize it, and make informed decisions, that’s the best path forward.”
Telling a story with data
Business leaders want clear measures of success. But it’s not enough to show them a chart and let them draw their own conclusions about compliance as revenue protection.
“Leadership usually speaks in objective, quantifiable numbers or measures. You can collect data all over the place, but it’s meaningless if there’s no story,” says Tiffany. For example, when you look at a chart comparing last year’s reporting rate to this year’s, you might see all the additional cases that were surfaced and investigated, saving the company valuable time, reputational value, and potentially huge amounts of money in avoided fines. Tell that story, and make it explicit! (For a real-world example of how compliance can positively contribute to the bottom line, check out our recent blog on compliance ROI by Tom Fox)
If you have the right tools at your disposal, your story becomes even more meaningful. It’s not just about the costs your team has already helped the organization avoid—but being able to predict future outcomes and avoid more potentially costly missteps. “Investing in technology allows you to take data and turn it into meaningful metrics. It also allows compliance and other functions to assess findings, maybe even predict trends, and then put into place controls that will prevent misconduct and other issues from occurring.”
“Having these numbers, the data, the trends, the big-picture outlook on what the organization is facing gives you a better opportunity to manage risk so instead of being reactive…you’re able to proactively make decisions whether it’s a compliance decision, a finance decision, or whatever the case may be.”
Get on the regulator’s good side
Speaking of being proactive…”Investing in technology is the fundamental pillar of a proactive approach, which obviously is very much supported by regulators,” Tiffany points out. Times may be tough, but tell your leaders to think twice if they’re coming for the compliance budget.
“The regulators aren’t pulling back. Yes, your pockets may be more restricted, but I still believe that investment in technology and giving compliance a seat at the table will allow organizations to reap the rewards, because they’ll avoid some of those pitfalls that they otherwise would have fallen into.” Pitfalls like monitorship, investigations, fines…the list goes on.
“For those who’ve had the unfortunate circumstance of falling into a situation where they wish they’d invested in technology, they’re probably proponents of making that investment now.”
Innovating for the future
With new guidance from the DOJ and a new FCPA resource guide released this summer, the regulatory stance is clear: evolve or face the music.
But if you’re eventually going to make an investment in new compliance technology and other resources, better to do it proactively than because a regulator told you to. “It’s better to get there of your own volition in a way that’s of most comfort to you and your organization, than to be forced to because of a monitorship or some other regulatory mandate,” says Tiffany.
In truth, evolving your compliance program isn’t just about outpacing the regulators—it’s about actively contributing to revenue, having a positive impact, and positioning your organization to succeed in a turbulent environment.
“As society and technology evolves, we’re being given more tools to be able to act more efficiently and take an innovative approach to compliance,” Tiffany says, “and that should be the driving force, not because the regulators say it, but because we can be more efficient at making sound decisions that will impact the organization’s bottom line.”
Need some help building an argument that compliance is both effective revenue protection and good for the bottom line? Join our webinar with Tom Fox and Vince Walden on August 25, as we discuss how compliance can actually build revenue—plus, we’ll share real-world examples and explain how to use data to tell a compelling story to your board of directors.