Compliance roles and functions have become broader and more complex over time. Developments in data management, processing and analytics have broken down silos, allowing compliance to obtain a more overarching view across risk typologies. The compliance culture has evolved, new challenges and technology solutions have emerged, and budgets have fluctuated.
This year’s Nasdaq Global Compliance Survey, which was conducted from May to July 2023, sheds light on the most pressing developments in trade surveillance, communications monitoring and fraud and anti-money laundering (AML) detection. It contains quantitative and qualitative data gathered from 190 compliance professionals from sell-side and buy-side firms, market infrastructure providers and corporate and retail banks and provides a comprehensive profile of year-over-year trends dating back to 2015.
Similar to previous years, respondents were prominently from sell-side firms, with solid representation from the buy side and market infrastructure providers as well as retail and corporate banks. The largest respondent base was in the Americas and EMEA, respectively, with increased representation from APAC. Respondents work in trade surveillance and general compliance roles – mostly in senior positions. Nearly two-thirds of respondents oversee more than one core compliance area, including AML, A/E-comms monitoring, fraud, and trade surveillance.
Cultural evolution
Once viewed as a cost center and a barrier to doing business, the compliance department has taken on a more strategic role, especially in sell-side and buy-side firms, according to the survey. Respondents in all regions participate in conversations about strategy. They view their most important function as protecting the firm’s brand reputation and managing reputational risk, which helps to attract new customers who want to do business with a respectable organization. Avoiding regulatory fines for compliance violations continues to be a priority.
A significant percentage of respondents endeavor to promote the development of an internal compliance culture in the age of social governance. They have become more proactive in ensuring that employees maintain compliance standards and understand specific requirements.
Counterintuitively, when asked what functions fall under the firm’s mandate for reputational risk management, the percentage of respondents who reported that promoting a firm-wide culture of proactive…
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