Best Practice Guide
Paying the cost of compliance management
If enterprise-wide compliance is on your mind, you’re not alone. Business uncertainty and regulatory compliance have both been in the news for some time now. In the Australasian region, for instance, Australia and New Zealand both revamped their occupational health and safety systems, forcing firms operating in those jurisdictions to invest resources in compliance with a number of new statutes, including landmark changes to asbestos and other hazardous materials management.
Globally, twin shocks to the political system, Brexit and the unexpected election of Donald Trump, made regulatory overhaul in two of the world’s largest economic zones, the EU and the U.S., a near certainty . Nor had business completely recovered from the previous shock to the system: the global financial crisis of the late 2000s. At the height of the Great Recession, subnational, federal, and supranational bodies all issued sweeping financial reforms, which majorly upped the ante on regulatory compliance risk. As catalogued by London-based think tank JWG, the years 2009 to 2012 saw the publication of over 50,000 regulations across the G20. That number actually rose to 50,000 regulations in 2015 alone.
The cost of complying with those regulations has, of course, been steep for businesses. In fact, the volume of regulation is the key contributor to rising compliance costs. Compliance with the Dodd Frank Wall Street Reform and Consumer Protection Act, for instance, cost banks $36 billion, according to the publication Trade. Cumulatively, regulatory compliance cost banks $100 billion in 2016.
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