Compliance

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Dynamic Duo

The CIO and CCO relationship is crucial in executing excellence in compliance.

Parallel to the recent M&A trend in the banking industry, which has banks learning each other's businesses, financial institutions' chief information officers and chief compliance officers are also learning from each other. These two group leaders within the bank are creating a must-do method by combining attributes from two different perspectives in order to gain excellence in compliance. By partnering to pursue success, compliance and technology executives are coming together to achieve innovation and configure winning strategies for compliance.

"For each and every regulatory mandate, compliance means changing the system over and over again," says Guillermo Kopp, director of financial service strategies and IT investments at Needham, Mass.-based TowerGroup. To successfully navigate the constantly changing regulatory environment, a firm's CIO and CCO must work together, he says. "CIOs need to actively team up with the CCO, leveraging [compliance] as an opportunity to bring this enterprise through change."

A prime example of the benefits of an ongoing relationship between the chief information officer and chief compliance officer in pursuit of compliance perfection is the collaboration of efforts at Wachovia (Charlotte, N.C.; $441 billion in total assets) between CCO Bill Langly, who oversees compliance for the entire organization, and Nancy Church, CIO, shared services technology. Although Wachovia has five CIOs, each in charge of different areas within the organization, Church and her technology group - which are responsible for the technology strategy and the day-to-day production, upgrading and provision of the technologies - work more extensively with Langly and his compliance group than the other CIOs. Together, they ensure that each business unit is responsive to new policies set forth to comply with regulations.

According to Langly, the bank's strategy for coping with regulations depends heavily on technology to achieve compliance. "We spend a lot of time [collaborating] - either me directly with Nancy, or a lot of times with compliance personnel matching off with individuals in her organization," he says. "So much of our abilities to comply with all the legislation we have now turns to technology."

Because current regulations, such as Sarbanes-Oxley, require the bank to organize mass amounts of customer data, Langly continues, compliance and technology work together in order to ensure business objectives at Wachovia. "[Regulation] requires technology to sift through all of the data that we would have to look through to ensure compliance," he says.

"As we are thinking about new products and services, compliance is one of those dimensions that we think through," he continues. "In order to do that, we are working closely with the technology people who are building the systems to support our business objectives."

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