Our Director of Compliance & Head of AML shares international compliance best practices for Global Businesses
Today, we’re talking to our Director of Compliance & Head of AML, Christiana Ellina. With a background as a Chartered Accountant and extensive experience as an Internal Auditor for JP Morgan Chase, Christiana is our go-to expert for international compliance issues. And best of all, our Compliance team is hiring in São Paulo and Nicosia.
In this interview, she tells us what makes compliance so central to international business expansion – and how to transform your compliance program from a “necessary evil” to a valuable strategic asset.
Q: Christiana, you’ve worked on compliance with businesses of every size, from large corporations to sole proprietorships. What do you wish every business owner knew about compliance?
A: I wish they recognized that compliance is good for business! Compliance is generally viewed as a “necessary evil” or a “box-ticking exercise” – but in fact, compliance can have significant, positive and long-term benefits for every business.
An effective international compliance program is not only about giving business owners peace of mind. It can increase a company’s transparency, efficiency, protection, accountability, stakeholder trust and brand loyalty.
“The synergy between a business owner’s clear vision, a good understanding of their operating environment, and a solid, customized compliance program can help ensure the longevity and growth of the business.“
Q. What makes an international compliance program effective?
A. While there is no “one-size-fits-all” compliance program for every organization, there are several core components that must exist for it to be effective. Some of these include:
- Ongoing Risk Assessments (along with the design, implementation or modification of the programme’s elements to manage its evolving risks. Ultimately, an organization can’t really have a robust risk management program without compliance, and vice versa);
- Standards, Policies and Procedures that ensure compliance with laws and regulations, give guidance for decision-making, and streamline internal processes. These can reduce the likelihood of criminal and other improper conduct such as money laundering and fraud);
- Organizational Leadership and Culture (that fosters the promotion of compliance with the law and the company’s Code of Conduct);
- Training and Education (to ensure that a company’s code of conduct, policies and procedures are widely broadcast and that employees are trained on the program’s objectives and relevant policies);
- Effective lines of communication and Appropriate Remedial Action.
Q: What are the main challenges for maintaining compliance in Latin American markets?
A: Governments in Latin America have started to pay more attention to compliance and have begun introducing increasingly tough legislation. Therefore, the main challenge I see is that regulations are changing fast in the region, and may also vary from country to country. The solution for business leaders is to ensure you have appropriate training across the board, coupled with an effective compliance program tailored to your pertaining risks based on geography, industry and any other relevant factors.
In addition, having strategic partners in the markets you operate in plays a key role in maintaining compliance with local laws and regulations. With its unique solution and proximity, PrimeiroPay serves clients around the world who are expanding in LATAM and who might be acquainted to different compliance requirements and standards, as applied in the jurisdictions they are operating in. However, that is where PPay makes the difference – going the extra mile, learning and listening to clients in their particular context, we offer fully customised payments solutions. And in doing so, we work hand in hand with every client in every aspect, including raising awareness on local industry and compliance regulations. An approach which has proven to be a cornerstone in building strong customer trust, brand loyalty and long-standing partnerships without compromising our quality or standards.
“Businesses that view compliance as an opportunity instead of a challenge can benefit from greater operational quality (transparent, clear procedures and ultimate control of their risks), efficiency, and quicker, smoother adaptation to new markets and to the ever-changing regulatory framework.”
This can help you avoid any unpleasant surprises, but will also build stability, trust and confidence amongst your stakeholders.
Q. You mention that governments are toughening up on compliance. How should businesses keep up to date with evolving regulations?
A. Having a clear process to monitor and manage compliance is essential to avoid costly fines, reputational damage, or even a loss of the right to operate. Some of the practical ways which I find most useful for staying current are:
- Subscribing to newsletters or email updates from local legislators, law firms and regulatory bodies and monitoring their websites;
- Conducting regular research on regulations relevant to the business and the industry it operates in;
- Attending online compliance training workshops, seminars, and conferences;
- Keeping a record of all upcoming regulatory changes and actions that need to be taken by the business;
- For larger businesses that come with more complexities, hiring an International Compliance Specialist is always a good option;
- Finally, businesses should work with their clients on regulatory changes that may affect them, and help them to prepare and adapt to those changes.
Q. What are the best ways to manage risk when you’re expanding a business internationally?
A. Expanding a business into new markets can bring many opportunities for growth and increased competitiveness. A key principle is therefore to always be prepared to find a balance between strategic ambition and its associated inherent risks.
You can’t plan for unknown risks, but you should certainly prepare an action plan to deal with known risks, rather than simply reacting to problems as they come up. There are three steps to an effective risk management in new markets:
- The first step is to have a systematic process to identify your potential risks.
- Once identified, those risks then need to be analysed and evaluated based on their severity, so that the business can focus on how to respond.
- Last but not least, you’ll need to make sure that your risk response measures are compliant with local and international standards, as well as assessing their ongoing effectiveness. You may need to adjust and improve your risk management strategy as you go forward, so a continuous monitoring process is fundamental.
Businesses that plan strategically and overcome these challenges will have access to diverse opportunities for business growth and success.