Chief Compliance Officer Requirements

A good Chief Compliance Officer must have a thorough technical and practical knowledge of the business. This allows a CCO to envision and then supervise compliance solutions. A CCO is responsible for designing the right policies and procedures and tapping into technologies needed for compliance.

A good CCO should also have great interpersonal skills, as they regularly interface with a variety of people, from C-level executives to the rank and file. The CCO’s responsibilities take them from the boardroom, reporting on compliance issues to top management and the board of directors; to the manufacturing plant, in order to train production workers on compliance.

Gravitas and credibility are important must-haves for a Chief Compliance Officer to be taken seriously. Additionally, a good CCO is able to navigate legal matters with relative ease and builds lasting positive relationships with regulators.

Superior multi-taskers often make the best Chief Compliance Officers, as they need to make strategic decisions, supervise complex monitoring programs, manage and educate highly skilled professionals, and even talk with other departments on issues relating to risk and control. What’s more, they need to stay up-to-date with what’s happening in their industry and changes in regulatory requirements.

To be clear, a CCO does not have to be an IT expert or a lawyer to be good at their job. But it does help if a CCO is comfortable dealing with both the legal and technology concerns that they are likely to encounter.

Key Challenges Faced by Chief Compliance Officers

Like any position, there are inherent challenges and risks faced by Chief Compliance Officers. The first challenge is that the job is not really clearly defined. Some companies give the CCO role to their general counsel, thinking that it only involves legal concerns. Others think that CCOs are merely the corporate equivalent of a high school hall monitor.

Then there is the challenge of not having the independence and authority to make decisions. Ideally, the CCO works with the CEO, the board of directors, and other employees to make compliance second nature to the company. However, conflicts of interest might arise, and for some departments, compliance might get in the way existing processes. In other organizations, CCOs do not report directly to the board, which makes it difficult for the officer to develop and implement policies and procedures.

Another problem faced by CCOs is that they might not have the necessary resources to do their jobs, as compliance teams tend to be lean and underfunded. However, investing in enterprise data loss prevention (DLP) software allows for deeper visibility and information control that can make compliance simpler and easier for the team. DLP software extends a compliance team’s capabilities while increasing efficiency, making it an essential part of a successful CCO’s operations.

Additionally, there has been a marked increase in personal liability not only for the CCO, but also to other senior officers. Thomson Reuters noted that in the past few years, they’ve seen a number of compliance officers working for big companies who are getting in trouble on the job. These compliance professionals have been fined, suspended, bannered, fired, or asked to resign.

Despite the challenges, the role of a Chief Compliance Officer can be quite rewarding, and it’s a role that’s becoming increasingly important for modern organizations in heavily regulated industries. As regulations continue to become more stringent and complex, CCOs will be in even higher demand as companies seek qualified professionals who are able to manage the complexities of the regulatory landscape.