Culture Of Compliance

Tuesday, October 01, 2013 20:54
Culture Of Compliance

Tags: compliance | sec

We all hear about maintaining a “culture of compliance,” as required by the SEC.  We are reminded of this concept constantly and it feels as if it’s seared into our brains. It feels as if it must be seared into our emotions as well, because we all shudder at the prospect of receiving the call from the SEC.

While it’s true that we must be vigilant with the SEC’s documentation, training and custody rules, we need to be, perhaps, even more concerned with substance rather than form.  If we are truly concerned with the well-being of our clients and the integrity of our practices, we need to do more than “talk the talk.”  And, that means adhering to a culture of compliance.

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After recently undergoing an SEC examination, I am convinced that our emphasis on ethical practices is what helped our audit go smoothly.  It was clear to the SEC from looking at our processes, talking to our employees and examining our records that my firm is based on the principal of doing what’s right for the clients.

Here is what I believe creates a culture of compliance within a firm:

  • An uncompromising insistence on doing what is best for clients
  • An emphasis on team education, including compliance topics such as privacy rules, custody, etc.
  • A practice of ongoing open communication between and among advisors, staff and clients
  • A focus on doing the right actions instead of just documenting the right actions
  • Careful consideration and selection of the people and companies with which your firm does business
  • Fostering an atmosphere of learning from mistakes
  • Leading by example

By choosing to adhere to fiduciary duty and stressing that philosophy to all on your team, you can create a true culture of compliance.

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