Jody Houton

Many traders and their compliance officer counterparts are beginning to return to the office, as the world of financial services takes slow, but steady steps toward a semblance of normalcy.

Indeed, earlier this month, the CEO of investment bank, JP Morgan announced it expected all of its U.S. bankers to be back in the office by July

It is a decision that is likely to split opinion, especially in the world of Legal and Compliance. 

In December 2020, compliance officers who were working remotely were surveyed about their experiences of working from home. More than three-quarters (78%) said they were equally or even more productive working from home, with only 19% saying their work output had waned.

As the majority of communication and collaboration is now done either digitally, or on the phone, compliance teams that are equipped with the right compliance solutions can process huge amounts of chats, IMs, and video conferences to safeguard against compliance issues like money laundering or collusion, or incidents of workplace misconduct, such as racism or bullying. 

Such solutions, which provide visibility and insights into how colleagues are communicating and collaborating, can allow compliance officers to ensure there are no compliance breaches, or conduct violations, from wherever employees are working.

Hybrid Workplaces

Other firms have stated that they will be adopting a more flexible, hybrid working model in the future. HSBC, for example, has announced that it will be moving toward a “hybrid model of working”, with employees having a mixture of working in the office and home.

According to Bob Mendelson, former Chief Compliance Officer at Sculptor Capital Management, however, there are some roles that thrive on that in-person, in-office experience.

What you don’t get (from working from home) for traders and investment professionals is the easy interaction and discussion of what’s happening in the markets, and what’s happening with their particular security. That is the fertilizer that makes firms better than the sum of their individual parts. 

Bob Mendelson, former Chief Compliance Officer at Sculptor Capital Management

“A lot of really important compliance is not done within the compliance department, but by the managers of the front office personnel. It’s why trading floors are open – you’re overheard. Supervisors, managers of trading units hear what’s happening. They’re sitting centrally to everybody else so they can hear. The reason they’re there is the ability to filter and hear what they need to hear about what’s happening around them.”

Regardless of whether it’s a return to business as usual, or adopting a more flexible working model, there are three elements that are likely to be front and center in the new world of working: technology, training, and policies.

Technology

Of course, our digital dependence didn’t happen overnight, but it has certainly become more acute over these last 15 months or so. 

In preparation for the office return, or hybrid workplace, organizations need to ensure they deploy oversight controls (compliance and conduct solutions) for collaboration and chat platforms. Usage of corporate platforms, such as Slack, and non-traditional platforms like WhatsApp has grown exponentially recently. 

Enterprises are required to observe the regulatory capture, retention, and supervisory obligations as mandated by financial regulators, whatever platform or channel employees are using. Compliance departments need to focus on plugging any potential compliance gaps, especially if employees are going to be flitting from the office to the home, sharing screens, files, and potentially sensitive company information. Technology facilitates supervision, wherever your employees are.

Policies

In light of the additional compliance complexities caused by the recent explosion of communication and collaboration platforms, policies regarding what is no longer acceptable in the workplace need to be updated. 

Employee communication styles have become relaxed over the last year. Indeed, the Enterprise Conduct and Risk Report, which surveyed workplace misconduct during COVID-19, discovered that 11% of respondents had witnessed colleagues dressing inappropriately, 13% smoking or vaping, and 9% drinking alcohol during video meetings.

If this is not acceptable in the physical office, then the employee handbook needs to be revisited and updated. Employees are used to managing their own time, working flexible hours, answering Slacks at 6am, or emails at 11pm, while having a 2-hour lunch break to accommodate a gym session. Guidelines need to be refreshed to state exactly how flexible the workplace now is.

A firm’s risk posture needs to be examined, from security protocol relating to requests for Wi-Fi passwords for unapproved devices, to hybrid work environment assessments, as it pertains to shared physical spaces. A proactive review, conducted by Compliance and Security departments should be undertaken now, ahead of a return to the office, or implementation of a flexible workplace model. Organizations that have an idea of not only how their employees have been working remotely, but how they are likely to do so in the office, and with whom, will have a head start.

Training 

Companies with insights into how their employees are communicating and collaborating, inside and outside the office, and the strengths and weaknesses of their policies will be at a significant advantage to those who do not, and who intend to just open the office doors, and expect things to snap back into normal.

Training to ensure employees understand new policies, office conduct, and security measures is therefore essential. Of course, what is deemed useful training for one department is completely different for another. Focused, data-driven training is important. It is crucial, therefore, to have visibility into the cracks in your organization in order to fill them.

Are you ready for the return? Or will you be adopting a flexible, hybrid working model?

AI-powered technology, such as Behavox Compliance, enables enterprises to organize and refine their data into actionable information that protects and promotes business growth.