Annual Conference 2022 

'Compliance - Setting the Standard'

Diarmuid Whyte, President of Compliance Institute 

 

 

Date: 10 November 2022

Good morning all and welcome to the Compliance Institute’s annual conference.

I have the great pleasure to open today's conference. As I am sure by now everybody is aware this year is and has been an extremely significant one for the Compliance Institute in its 20th Anniversary.

 

This year has seen a further 494 graduates from our 11 Compliance educational programmes, with six professional designations and a further to come next year, the Compliance Institute now has over 3,300 members and we have continued ambitions to grow and provide much needed educational offerings to the industry. The Compliance Institute was also delighted to recently launch the Professional Diploma in Sustainable Finance for Compliance Professionals, a level 8 programme on the NFQ provided by the IOB and awarded by UCD. These educational programmes form a critical part of our financial services industry and their importance will continue to grow with the evolving regulatory landscape.

The past twenty years have seen continuous evolution of the significance of Compliance as a profession from an individual being responsible for Compliance as a small part of their day-to-day role to dedicated roles forming an integral part of firms’ leadership teams.

 

Compliance is now not only the responsibility of the Compliance profession and our membership base occupying Compliance positions. Arguably, this perception should never have existed and rightly Compliance now sits at the heart of our organisations including areas such as product creation governance and target market distribution. Compliance must be embedded within our organisations culture to ensure that customer/client focused outcomes are key to our operations.


As part of this cultural change, we know, Compliance is here to stay but the form can and will continue to change. Today we will hear from outstanding speakers and panels to discuss a number of fundamental developments for our regulatory environment and two specific focus areas for today the Individual Accountability Framework and Environmental, Social and Governance both neatly condensed into three letter acronyms, Both these areas of regulatory development have been a long time coming but certainly were needed post the Financial Crisis and will be positive developments. Credit must be given to both the Central Bank of Ireland and the government in delivering this legislation.

Firstly, the Individual Accountability Framework, commonly known as IAF. We believe the IAF legislation will bring a continued evolution of the Fitness and Probity regime. The Bill published in July creates Ireland’s comprehensive senior Executive Accountability Regime (SEAR). This legislation will embed further positive cultural change across the financial services sector by introducing tiered accountability for managers charged with completing vital roles.

 

We would caution that the application of these new rules needs to be both workable and proportionate. The imbalance of information between a customer buying a financial product versus the organisation selling is a well known comparison. While It is imperative to protect consumers and the Financial Services Sector, employees regardless of seniority, are also entitled to the same level of protection, something which can sometimes forgotten when this topic is debated.

There is clearly a need to hold directors and officials to a higher standard and ensure customer outcome focus is key, it is also a necessity that we do not lose high calibre individuals for fear of the personal liability associated with a senior executive position. This would not only be a detriment to the financial services sector but also those customers who we all strive to protect.

 

There are concerns that the implementation of the IAF regime will make it difficult for firms to recruit individuals into PCF roles. The recent Institute membership survey, The Individual Accountability Framework Planning and preparing for increased accountability in financial services has highlighted that 84% of respondents believed that this indeed would be the case. One of the key areas of concern perhaps is the reasonable steps requirement to take account of all relevant circumstances in undertaking demonstrable steps.

 

I personally am of the belief that any concerns should be mitigated with IAF governance frameworks that firms will implement and the clear documentation of responsibilities of those occupying positions within the scope of the regime. Finally, and importantly through appropriate stakeholder engagement as to the expectations of these rules. I look forward to our panellists’ thoughts on the IAF framework and how organisations can manage these challenges.

 

Another of our core themes today and for the financial services sector as a whole is the area of Environmental, Social and Governance (“ESG”). At a time when climate change and social injustice are headline news every day ESG remains in focus and certainly shows no signs of losing importance.

 

United Nations Secretary General Antonio Guterres made a number of significant remarks at the start of the COP27 summit in Egypt noting “Greenhouse gas emissions keep growing. Global temperatures keep rising. And our planet is fast approaching tipping points that will make climate chaos irreversible” and Today's crises cannot be an excuse for backsliding or greenwashing. If anything, they are a reason for greater urgency, stronger action, and effective accountability”.

 

These comments, the changing regulatory environment, the ongoing focus by regulators, the expectation and intention for presidents, prime ministers, and CEOs to be held to account means it will remain a key focus for the financial services industry. ESG like IAF is not limited to a focus area for just the Compliance professionals but requires focus and ownership across our entire organisations. Our ESG panel discussion will include an overview of the future legislative changes, practical case studies to date, how firms are embedding vest practice and the expected role of compliance professional.

 

Today's speakers and panels will share their views and perspectives on the themes of IAF, ESG, progression of a career in compliance and the ongoing need for Ethical decision making across these areas.

 

Speaker/Panel intros

 

I am delighted to welcome Colm Kincaid, Director of Consumer Protection, Central Bank of Ireland, who will be our first speaker.

 

Paul O Loughlin, Head of Financial Services Compliance at An Post. Paul will explore the role of the compliance professional and what it means in practice, including how to build a successful compliance team, the challenges for the profession and what the future holds with IAF.

 

We will then be joined by the Minister for Public Expenditure and Reform, Michael McGrath who will speak to the importance and developments in the areas of ESG and IAF

 

Kian Caulwell will then present IAF survey results and will then chair a discussion panel on IAF with:

Davinia Conlan – Associate General Counsel for Citibank Europe Plc and Interim Country Head for Citi Ireland

David Blunt – Culture and Governance specialist and ex Head of Conduct Specialists in Supervision at the UK Financial Conduct Authority

Oliver Gilvarry – Assistant Secretary in the Banking and Financial Stability Division of the Department of Finance.

 

An ethics panel will then follow chaired by Coleman Hudson – Head of Legal and

Compliance AON

Elaine Byrne – Sunday Business Post Columnist, Barrister and Member of the Policing Authority

Nadia Chiarina – Director, Sustainable Finance, FSRM, EMEIA at EY

 

After lunch we will have a panel on ESG chaired by

 

Carina Myles – Partner Governance, Risk & Compliance - EisenAmper

Aidan Horan – Director at the Institute of Public Administration (IPA) with overall responsibility for governance and assurance services

Brian O ’Kennedy – Managing Director, Clearstream Solutions

 

Please do enjoy the Compliance Institutes 2022 Conference, I know I will.