Originally published in MarketsMedia
Compliance in Focus is a content series on regulatory topics for financial markets and the challenges compliance officers face in addressing surveillance and monitoring. Compliance in Focus is produced in collaboration with Eventus.
Joseph Schifano, Global Head of Regulatory Affairs at Eventus, recently appeared on the DerivSource podcast ‘Living the Trade Lifecycle’ – specifically its ‘Professional Pivots’ series – to discuss how advances in technology are impacting compliance professionals and how they can keep up. This Compliance in Focus article excerpts Schifano’s key points from the podcast, in his own words.
Joe Schifano, Eventus
Chief compliance officers are under continuous pressure to do more with less and economize resources. With the constant drive for efficiency, firms are naturally looking to how technology can deliver greater automation, operational efficiency, and support data analysis so compliance professionals can identify and address risks more quickly.
This adaptation to new technologies isn’t a new concept for compliance departments. With the advent of electronic trading decades ago, compliance professionals had to move to data analysis via Excel and similar tools. Now financial institutions are looking to more advanced technologies to support compliance and market surveillance functions, including artificial intelligence (AI) and machine learning (ML).
Professionals are impacted – 3 changes
With the compliance department becoming more tech-heavy, compliance professionals need to become more tech-savvy. There are three key trends happening in how professionals are upskilling, and department heads are filling gaps in expertise across their teams.
Technologists – Compliance departments are hiring pure technologists into their departments to manage data systems. These technologists tend to be experts in data integration, data analysis, reporting and related functions.
Tech-savvy compliance professionals – There is an increase in the hiring of compliance professionals who have technical skills, such as coding background – SQL or Python, for instance– where they can analyze the data directly and create reports.
All-rounder – Compliance departments need professionals who have a good understanding of what the technology can do and who can effectively communicate the needs of compliance functions with the technologists, so a common understanding is established.
The latter skillset is important given that the increased use of technology can introduce greater operational risk. A firm doesn’t want to build new technology that the team cannot figure out how to use, nor do they know how to fix it if it breaks in six months. Compliance technology must be built right the first time to incorporate all rules and regulations and detect errors. All these factors need to be considered ahead of time. So, compliance professionals need to be able to work holistically with their technologists as well as other stakeholders, such as the front office, to get things right before and as they are built.
Why now is a good time to work in compliance
Technology is constantly changing but so are trading desks, capital markets businesses and, of course, regulatory space and RegTech – this all makes for an exciting time to work in compliance.
The consistent influx of change introduces new challenges. Individuals who appreciate diversity in a role and are skilled at translating the needs of various stakeholders (internally and externally) are well suited for a job in compliance. And as this space continues to evolve, there will be new opportunities for career upward mobility for compliance professionals.
What can you do to enter the compliance field?
For new entrants into this space, one of the best ways to start a career in compliance is to work for a regulator. The Securities Exchange Commission (SEC), FINRA, and regulators in other jurisdictions around the world are constantly looking for smart and ambitious people to learn either through the examination process, the policy advisory process, or other avenues. It is a fantastic introduction to compliance. And while the salaries may not be as competitive at the outset compared to financial institutions, the experience is invaluable.
There are other entry points, like directly from a technical role or a front-office role. These entry points are particularly relevant for those professionals with a few years of financial markets experience under their belt who want to pivot into a new area. I did this myself, pivoting from the front office to legal and compliance roles after studying for a law degree at night. After years as in-house counsel, responding to regulatory inquiries, and as a Chief Compliance Officer, I now run regulatory affairs at Eventus, a trade surveillance software company.
Compliance is a function that is also important across various industries, not just financial markets. This means compliance professionals may pivot into academia or other industries as their skill sets will be transferable allowing for a range of career options mid-career.
While some elements of compliance may be perceived to be mundane, the diversity of the role, ever changing external factors and constant adopting of newer technologies makes it an exciting time to work in this space with ample opportunities for career advancement in the future.
*For the full interview with Joe Schifano, please listen to the DerivSource Living the Trade Lifecycle podcast here or wherever you listen to podcasts. DerivSource is a Markets Media Group publication.