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SEC Chief of Staff Outlines Compliance Challenges

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SEC Chief of Staff Andrew (Buddy) Donohue recently described the future challenges facing compliance officers.  Mr. Donohue expressed concern about shrinking top-line growth in the asset management industry that could compromise the ability of compliance officers to obtain the funding necessary to implement the compliance program.  He also questioned the emerging trend of compliance taking a more active role to ensure compliance rather than assisting in identifying regulatory issues and developing policies and procedures.  Mr. Donohue warned that compliance must be viewed as a partner, not a “scapegoat or cost center.”  Mr. Donohue also inventoried the ever-expanding knowledge required including laws of multiple jurisdictions, overlapping statutes, and new technologies.  He advised compliance officers: “It is critical that you make it a priority to develop the necessary technical expertise, keep up with changing market dynamics, fully appreciate all of the firm’s businesses and follow regulatory developments and their impact on your firm and its operations.”  Despite his comments, Mr. Donohue expressed hope that his comments won’t “scare you away from a career in compliance.”

OUR TAKE: With over 40 years’ industry and regulatory experience, Mr. Donohue is a respected voice on regulatory and compliance issues.  Every CEO and Board should read this speech and ask whether their CCOs have the attention and resources to meet these challenges.

https://www.sec.gov/news/speech/remarks-at-the-national-society-of-compliance-professionals-2016.html

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