Most companies are not satisfied with the effectiveness of their compliance programs. One way to assess the effectiveness and efficiency of one’s compliance program with the objective to propose enhancements is to perform compliance testing and compliance monitoring. Many companies invest in technology to support their compliance function in general and continuous compliance monitoring in particular.
The respondents to PwC 2018 State of Compliance Survey state the following with regards to their compliance program effectiveness, compliance program assessment and compliance monitoring:
According to the survey, only 17% of total respondents indicated they are very satisfied with the effectiveness of their compliance programs. 45% of the respondents indicated that they are somewhat satisfied.
Current state of compliance effectiveness
Data points used to measure the effectiveness of ethics and compliance policies and procedures are (in the order of importance) internal audit assessments, culture internal survey results, and frequency of policy violations.
Data points used to measure the effectiveness and ethics and compliance policies and procedures
According to our survey, internal audit assessments are one of the main ways that companies today seek to gain comfort concerning the effectiveness of their compliance program. However the compliance risk landscape is more and more diverse, complex and volatile and requests specialized knowledge and experience. For this reason, many companies mandate their compliance department to perform quality assurance activities to assess the effectiveness of their compliance programs.
Quality Assurance activities are usually delivered through Compliance Testing and through compliance monitoring. Technology supports the delivery of monitoring services at around 1/3 to 50% of respondents:
Technology tools in place
Some compliance programs- a minority in this year's State of Compliance survey- stand out as very strong contributors to their organizations: 17% of total respondents indicated they were very satisfied with the effectiveness of their compliance programs. But even though that subset of Leaders is self-identified as such, out study shows that these organizations do exhibit distinctive behaviors and follow compliance-leading practices and technologies far more often than their Fast Follower or Striver peers. (We named the 45% of respondent reporting they were somewhat satisfied with compliance effectiveness Fast Followers and the remaining 38% or respondents, who were neutral or dissatisfied with compliance effectiveness Strivers.)