The year 2020 has showed businesses that they will need to create some new rules, use better tools and provide services in new ways, if they want to grow and succeed in 2021. Under normal conditions the market is dealing with one major event or a change and everyone is discussing how businesses can protect themselves under the conditions caused by said event. What’s remarkable about 2020 is that instead of one major event affecting the financial organizations, there were three major events, all of which directly affected both risk and compliance management.

It is important to understand that 2020 has set a new precedent. As volatile as 2020 was, it is important to recognize how the business world harnessed innovation to approach the challenges we faced and how that helps us better navigate risk and compliance in 2021.

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Three Game Changers

There were three major events which affected the risk and compliance framework for financial organizations. The election in 2020 was an anticipated event; everyone knew it would happen in 2020 but they would not know what its outcome would be. However, businesses have been dealing with elections since the country has existed and there are many plans and strategies in place to ensure that businesses can pivot as government leadership changes.

Brexit was something that the financial world was dealing with for the first time in the modern era. There has been remarkable stability in the European and North American regions as far as the major players are concerned. Brexit has caused many risk and compliance issues for businesses because of the new rules and regulations, many of which are still being written and updated. Businesses have known that Brexit was coming for more than two years now, but the extended negotiation timeframe was challenging for businesses planning.

The 3rd event, which came without any warning, was the pandemic. There was a lot of concern in the financial world about how operations will be carried out and services will be delivered in the face of the shutdowns, work-from-home, and other types of restrictions that were seen across the country.

In 2020, most businesses and governments took whatever measures they could with the information available at the time to keep everyone safe while also protecting the economy. This is where 2021 will be very different from 2020. Businesses are still preparing for government regulation, but the instability is no more because the outcome is known. Brexit has also now been completed, and there are a lot more resources available to understand the impact to rules and regulations. The pandemic is a year old, which means that everyone is now experienced in delivering operations and ensuring business continuity throughout its conditions.

The Four Most Important Factors for Risk and Compliance Management

Risk and compliance managers across the country have realized that succeeding into dignity means being cognizant of four factors. These four factors are based on the learnings and expert insights gained through experiences in 2020.

1- New Challenges on the Horizon

Every financial organization in the country needs to understand that there are new challenges for risk and compliance management that need to be managed. Businesses will have to rise to the occasion by improving their risk and compliance management frameworks and increasing their ability to detect compliance issues and predict emerging risks.

In 2020, instead of one major event affecting the financial organizations, there were three major events, all of which directly affected both risk and compliance management Click To Tweet

2- Opportunities in an Uncertain Era

Being able to find opportunities under uncertain conditions is a major focus for the most innovative risk leaders in the country. Enhanced risk prediction and direction technologies can help businesses understand the safest route to take to achieve the organization’s objectives of growth and stability.

3- Growth Lessons from 2020

2020 has exposed the vulnerabilities that businesses need to mitigate. Businesses also learned a lot about what was truly necessary for them to successfully deliver their services and products to customers in a satisfactory manner. As important as it is to go back to some semblance of normalcy, business should also look at how do you need to transform based on what they learn to live without and what they just started doing to deal with the major problems faced in 2020.

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4- The Role of Technology

Digital risk transformations were considered an inevitable next step for every business to take, but many businesses were delaying the investment as much as possible. 2020 has catalyzed the situation and businesses are quickly realizing that risk technology will be an essential tool for 2021.

Want to learn more about how these 4 factors can help businesses successfully manage risk and compliance in 2021? Join our next webinar Risk Management Challenges and Opportunities: 2021 Outlook on 16th February, 2021, for an exciting presentation, demonstration, and discussion by Robert Berger, VP of Sales at 360factors, Deanna Radich, Senior Compliance Manager at Western Alliance Bank, and Clayton Mitchell, Principal at Crowe.