Enterprise Compliance Risk Management. Ramakrishna Saloni

SALONI P. RAMAKRISHNA

      Enterprise Compliance Risk Management

      Advance Praise

      Enterprise Compliance Risk Management: An Essential Toolkit for Banks and Financial Services is truly a practitioner's handbook peppered with appropriate templates, tools, scorecards, and framework to manage compliance in a structured way. The hallmark of the book is how Ms. Saloni Ramakrishna connects with her readers through her characteristic flowing and easy to comprehend narration of a layered, multifaceted, and nuanced subject like compliance. Her deep understanding of the risks as well as the opportunities for financial services institutions to better manage those risks for the benefit of customers, employees, and shareholders is well encapsulated in the central theme of the book – active compliance management.”

– Peter Hill, Investment Banker and one of Risk.net's “Top 50 Faces of Operational Risk”

      Through the book Enterprise Compliance Risk Management: An Essential Toolkit for Banks and Financial Services, Ms. Saloni Ramakrishna brings to bear her extensive hands-on experience as a practitioner in detailing how technology needs to be weaved intrinsically into a compliance program for it to be successful. Her emphasis on the role and relevance of a well thought out, appropriately designed technology framework as the bedrock of creating and perpetuating an active compliance is spot on.

– Stuart Houston, Global Solution Director – Analytics, Oracle Financial Services Global Business UnitEnterprise Compliance Risk ManagementAn Essential Toolkit for Banks and Financial ServicesSALONI P. RAMAKRISHNA

      Copyright © 2015 by John Wiley & Sons Singapore Pte. Ltd.

      Published by John Wiley & Sons Singapore Pte. Ltd.

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       Library of Congress Cataloging-in-Publication Data is Available

      ISBN 9781118550281 (Hardcover)

      ISBN 9781118550328 (ePDF)

      ISBN 9781118550311 (ePub)

      Cover image: Business Analysis ©iStock.com/Artzone

      Cover design: Wiley

To, my father – my Guide and GuruSh. Pisipati SriRama Chandra MurthyFor ingraining in me the confidence and courage to be myself

      Preface

      The first known compliance breach and regulation violation is that of Adam eating the forbidden apple. Since then, multiple compliance breaches have occurred, with challenging to catastrophic outcomes. Banks and financial services are more vulnerable to the effect of breaches and their consequences, given that they deal in the financial well-being of individuals and the economy. It is slowly dawning on the stakeholders of the industry that proactive management of compliance and the associated risks will be a business multiplier.

      Compliance risk management, as a distinct subject, in banks and financial services is young and evolving. Complying with authority, in a narrow sense, has been in place for ages now, but the many dimensions and nuances added due to the exponential increase in the complexity of the financial world have greatly expanded its scope and have brought it to center stage. The creation and elevation of the role of chief compliance officer – the journey from a dusty table in a corner of the office to a place at the C level executives table in the boardroom – speaks volumes about this transition. However, the systemic integration of compliance into the business and strategic fabric of the organization is yet to happen.

      In the face of an anemic global recovery and lack of alignment of business models with active compliance, this field justly demands that it be treated as a discipline in its own right – more so now than ever. There is insufficient literature and a lack of comprehensive references in compliance risk management. This book is intended to address that gap.

      This book seeks to provide an essential toolkit for navigating the compliance universe, aligning itself with and enhancing the fundamental business objectives of value creation, preservation, and enhancement of organizations. It provides a broad view of managing compliance and compliance risk holistically in the financial services space. Multiple facets of the subject and their interrelationships are explored. Important aspects covered are the use of active compliance management as a strategic tool, cost benefits of active compliance management, and connections with other traditional and evolving risk disciplines.

      The purpose is to rise above mere evangelizing and move into the realm of operationalizing compliance in the real world. The three areas of focus are: (1) detailing the how of compliance, including discussions on compliance framework and operationalizing compliance; (2) the hitherto largely underexplored life cycle of compliance risk management from risk definition to regulatory dialogue; and (3) real-life challenges in the world of compliance such as areas of conflict, myths, gray/overlap areas, as well as some innovative yet practical strategies that practitioners have developed to meet these challenges. Templates, tools, and a framework to manage compliance in a structured way will help readers to jump-start or refine compliance initiatives in their organizations. Instead of the traditional foreword by one expert, this book is peppered with five Practitioner's Notes – thoughts and views on the subject of compliance by industry experts, adding to the real-world perspectives that the book brings to the table.

Saloni Ramakrishna

      Acknowledgments

      Book writing is a challenging expedition with demands not only on the author in terms of vision, fortitude, and persistence but also on others who support and guide the initiative. I would like to express my gratitude to the amazing people and organizations that have made this expedition a great learning and sharing experience. The credit for seeding the thought of writing a book goes to Nick Wallwork of John Wiley & Sons, who casually asked if I would consider writing a book for them, almost as if he knew I could and would. Thanks, Nick.

      A very special acknowledgment goes to Srikar Gullapalli for making this book possible by being such an incredible motivator, critic, collaborator and editor all rolled into one. My gratitude to my anchor and life partner, Sh. Ramakrishna Gullapalli, for keeping me on course with his encouragement at every step. Thank you Sravani Gullapalli, for powering my effort with your infectious energy, optimism, and