The importance of measuring culture—and eight key principles for promoting it

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Posted by Keith Darcy, Independent Senior Advisor to Deloitte & Touche LLP, and Dave Wilson, Independent Senior Advisor to Deloitte & Touche LLP, on May 17, 2016

“Culture” is the focus of significant regulatory attention in the financial services industry. It comes up in the aftermath of governance breakdowns, and is discussed as being at the root of what went wrong. In the light of high-profile conduct failures in the US, the UK and Europe, this reaction and heightened regulatory scrutiny is understandable. But a firm’s attention to culture can be more effective when it isn’t reactive at all.

In a new whitepaper, Management information on culture: Connecting the dots, we aim to refocus the spotlight on culture as a 365-day-a-year business-as-usual factor in a firm’s strategy and overall performance. It is critical to a firm’s long-term success to understand and manage culture.

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FSOC issues update on potential systemic risks in asset management

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On April 18, 2016, the Financial Stability Oversight Council (FSOC or the Council) issued an update1 on its review of potential systemic risks arising from asset management products and activities.

The FSOC’s review—including its December 2014 notice seeking public comment on asset management-related issues—has focused on five areas:  liquidity and redemption, leverage, operational risk, securities lending, and resolvability and transition planning.

In conducting its analysis, the FSOC utilized publicly available data, confidential data reported on the Securities and Exchange Commission’s (SEC) Form PF, input from member agencies with supervisory authority, academic studies, and submissions in response to the request for public comment.

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2014 Compliance Trends Survey Report

2014 Compliance Trends Survey ReportPosted by Tom Rollauer, Executive Director, Center for Regulatory Strategies, Deloitte & Touche LLP

Deloitte and Compliance Week magazine recently released a joint survey report on key compliance trends in 2014. The annual survey, which is in its fourth year, included 209 responses representing a wide range of industries from America and around the world. Questions focused on three major issues:

  • Do compliance executives have the appropriate authority and resources to do their jobs?
  • Are compliance executives addressing the right risks?
  • Do compliance executives use the right metrics to measure progress?

This year’s survey found some level of improvement in all three areas; however, the results were a mixed bag and overall there is still a burning need for organizations to improve how they handle their compliance activities — particularly in light of today’s increasingly demanding compliance environment and the complex new requirements associated with laws such as the Dodd-Frank Act and Affordable Care Act.

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Highlights from the 2014 Compliance Week Conference

Highlights from the 2014 Compliance Week ConferencePosted by Nicole Sandford, Partner, Deloitte & Touche LLP

Deloitte recently presented at the 2014 Compliance Week Conference in Washington, D.C., which drew top executives and compliance professionals from leading companies across a wide range of industries. Hot topics included the rising importance of reputation risk and third-party risk, as well as the need for a more integrated and efficient approach to managing different types of compliance risk.

Managing risk and compliance in today’s fast-paced global business environment is more challenging than ever. To avoid trouble, many companies are conducting a number of risk assessments for different purposes, including those executed by internal audit, enterprise risk and compliance. All of these are important. However, many compliance professionals and executives at this year’s conference expressed concern that these efforts have not been well coordinated, resulting in “assessment fatigue” in the businesses.

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Hot Off the Press: FDA Strategic Priorities

Hot Off the Press: FDA Strategic PrioritiesPosted by Seth Whitelaw, Director, Deloitte & Touche LLP

Just before the July 4,2014, the U.S. Food and Drug Administration (FDA) released a draft of its strategic priorities for the next four years. In case you were busy celebrating the holiday and didn’t have a chance to read through all forty pages of the report, here is a quick recap of some of the goals the FDA will be focusing on between now and 2018. The FDA’s updated goals align closely with the trends we highlighted in our recent mid-year overview of the regulatory environment in life sciences, which looks at these issues in more detail.

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Preparing for FDA Social Media Guideline Implementation

Preparing for FDA Social Media Guideline Implementation

The FDA has released new guidance regarding utilization of social media for advertising and promotion of pharmaceuticals and medical devices. This long-awaited guidance is the start of numerous specific guidance documents addressing defined issues in social media.

As companies search for new and effective ways to reach healthcare professionals through non-personal channels, the emergence of short-form media options is increasingly becoming a meaningful marketing and information dissemination platform. However, the legal, regulatory and safety professionals need to begin conversations with the commercial and marketing teams to take full advantage of the new communication channels, while remaining compliant. Effective processes and controls will need to be put into place to enable companies to leverage these platforms; and, in order to use these platforms, companies will need to have modified review and approval pathways to facilitate expedited approvals to keep pace with the speed of social media posting.

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Regulatory Liason Office: Savvy Investment or Basic Necessity?

Regulatory Liason Office: Savvy Investment or Basic Necessity?

In today’s challenging regulatory environment, a new corporate role of regulatory liaison with staff to support it is emerging to provide a central point of contact for the regulatory community. This role known by different names effectively is a liaison for an organization in their management of their regulators, and assists together with other support functions, e.g., legal, risk and compliance, to manage a organization’s regulatory issues. Historically, this role was assigned to a single executive dedicated to regulatory risk management, or as a part-time responsibility of that executive who usually was a member within the C-Suite of the bank, e.g. the chief operating officer (COO) or chief administrative officer (CAO). However, as the complexity and impact of regulations continued to develop and capture significant amounts of management’s time , many organizations began to recognize the need for a more comprehensive Regulatory Liaison Office (RLO) outfitted with staff consistent with other functions within the risk and compliance organizations.

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Fed FAQs for FBOs

The Securities and Exchange Commission Reforms Money Market Rules

On June 26, 2014, the Federal Reserve (Fed) published answers to a list of frequently asked questions (FAQs) from foreign banking organizations (FBOs) that face enhanced prudential standards — including formation of an intermediate holding company (IHC) for non-branch U.S. operations and submission of an Implementation Plan. Many of the questions were generated from a town hall meeting the Fed conducted in May 2014 to help selected FBOs understand the planning requirements and timing associated with the enhanced standards.

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Heightened Risk Requirements: OCC Defines “Strong,” Now Banks Must Get There

On September 2, 2014, the Office of the Comptroller of the Currency (OCC) finalized new standards that formalize “heightened expectations” for risk governance on the banks over $50 billion it regulates — and in turn, impose new levels of responsibility on the board and executive leaderships of those institutions for the risk decisions they make.

Now, banks must codify “strong risk management practices” at the bank legal entity level, including governance policies, procedures, structures and even board composition. What some banks have had to do as the result of individually targeted Matters Requiring Attention (MRAs) is now applicable to all, albeit on a phased basis according to size. All banks with more than $50 billion in assets must comply with the new rules within 18 months. Those whose assets total between $100 billion and $750 billion have six months and those with more than $750 billion must comply within two.

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