Inspection & Standards
Compliance officers help senior managers to make sure that the activities of their organisation, and each person in it, meet the required standards of the regulatory authority. They help to set policies, investigate areas of concern and prepare reports for senior managers and directors.
Most firms and organisations are regulated in one way or another, and have to comply with the requirements of the government or government-appointed regulators.
Typical examples are in connection with health and safety, or data protection. There are also many EU Directives that apply to organisations in the UK. Responsibility for complying with whichever regulations apply to each particular firm belongs to the senior management of the firms concerned.
In the case of sole traders, that will be the sole traders themselves. In the case of small firms, one of the directors or partners will often take on the responsibility, perhaps with several other duties. In larger firms, there is usually a compliance department, headed by a 'Compliance Officer' who advises the board on the regulations which apply to the firm, and how the firm needs to comply with them.
Reporting to the Compliance Officer there are often compliance managers, technical advisers and monitoring staff, checking that departments are being compliant.
Companies offering financial services such as mortgages, life assurance, investment management, financial planning and pensions are regulated by the Financial Conduct Authority (FCA) or the Prudential Regulation Authority (PRA).
These organisations cover the way regulated firms conduct their business, the ways in which products are advertised and sold and complaints are handled, the way firms are organised, whether they are solvent and if they have appropriate systems and controls. The FCA also deals with qualifications that certain staff must have.
The FCA and the PRA regulate partly by specific rules and partly by generally worded principles, including a code of conduct. It is the responsibility of senior management, the partners and directors to make sure that their organisations comply with the rules, and to decide how they will interpret the principles. One member of the senior management must assume overall responsibility for compliance.
This person could also be the compliance officer, but in larger firms, the compliance officer could also be the person managing the compliance department, providing advice and guidance to senior management and overseeing the compliance function on a day-to-day basis.
It is very important that senior management listen to the concerns of the compliance officer because the regulator can impose disciplinary penalties, including large fines, if firms do not meet the standards.
Compliance officers are involved in preparing policies, staff handbooks and training schedules. They work closely with human resources departments to make sure that the correct staff training is carried out and recorded properly. They might sometimes give training themselves. They need to convince colleagues that compliance should be part of the culture of the entire company.
They monitor all the activities of their organisation, investigate any areas of concern and prepare and present reports. They take an active role in making sure that all sales, advertising and promotional strategy and materials are clear, fair and not misleading.
Compliance officers build good relationships with the regulating authority. They prepare for and manage compliance visits and follow up any action required as a result of the visit.
They keep up to date with new regulations. They might be asked to investigate new business areas to make sure that they will comply with the law.
Compliance professionals who work as consultants travel around to visit many different client companies.
Personal Qualities and Skills
- Excellent communication and interpersonal skills.
- To be able to pay close attention to detail.
- Report-writing skills.
- To be self-motivated.
- Presentation skills.
- To be able to prioritise tasks and manage your time well.
- General IT skills.
- Confidence and determination.
Pay And Opportunities
Typical employers of compliance officers
Employers include banks, building societies, insurance companies, firms of investment specialists and investment banks.
Other organisations offering financial services to the public require a compliance function and might use the
Opportunities occur for experienced compliance officers to work independently as self-employed consultants.
Entry routes and training
Many entrants are graduates with relevant experience in financial services, insurance, mortgages or investments. Relevant degree subjects include finance, economics, accountancy and business law.
There are some postgraduate qualifications in financial regulation and compliance.
It is also possible to enter general financial services work with A levels / Highers or equivalent and progress to compliance work.
Entry requirements for degrees vary so it is important to check with individual universities.