In 2023, we foresee that an increasingly hybrid workforce, a rising tide of tech innovations and an enhanced focus on ESG will cause several regulations to be updated, creating new requirements for businesses to follow, new areas of risk to monitor, and more money and time spent adjusting to these changes.
Against this backdrop, here are the top compliance trends that we expect to see this year:
Greenwashing will come under greater scrutiny
As Environmental, Social and Governance compliance gains traction with investors, the flip side is that many organisations are making claims that have turned out to be ‘greenwashing’ – making assertions about the positive impact that a product or service has on the environment that are not true or are exaggerated. Going forward, we expect that greenwashing will come under greater scrutiny and companies must make all-out efforts to align their business governance with the legal and non-legal compliance requirements relevant to ESG considerations.
AI Regulatory compliance will come into its own
Our next prediction lies around the rising importance of AI Regulatory compliance, which consists of identifying artificial intelligence (AI) and other automated systems used to make decisions on consumers, employees, and job candidates. With complex automated decision-making systems in place, even with a checklist, it can be hard to achieve a full understanding of a system’s risks. Thus, risk assessment could be a complex task that requires compliance experts to dive deep into existing processes and understand them layer by layer.
The rise and rise of tech-savvy compliance officers
Another compliance trend we foresee is rising demand for compliance officers who can fully leverage technology to discharge the compliance function. As the compliance function spans the full spectrum from bribery and corruption regulations to diversity and inclusion policies, we predict that the compliance officer’s role will morph from an inspector who points out risk areas and mitigates, to that of an advisor who supports creative risk-taking.
Greater demand for compliance e-learning solutions
The global e-learning compliance training market is expected to balloon from US$5.3 billion in 2022 to US$12.60 billion by 2029. There are constant eyes on illicit activity with big data, mobile technology, and social media making it easy to see where a breach occurred – even as they lay businesses open to direct feedback from those affected. To ensure that their old training techniques continue to appeal to a hybrid workforce, businesses must take this shift in mindset into account when they innovate and replace compliance training materials.
Virtual asset compliance to take centre-stage
Financial centres are going out of their way to woo digital asset investors by putting in place the right regulatory environment for virtual assets. With support from the G20, the Financial Action Task Force (FATF) has issued global, binding standards to prevent the misuse of virtual assets for money laundering (ML) and terrorism financing (TF). This makes it incumbent on all organisations to develop an understanding of these complex and ever-evolving regulations and to protect themselves from becoming a target of ML/TF perpetrators.
Stay safe with compliance at the steering wheel
All in all, keeping abreast with ESG, forging ahead with automated processes to improve decision making and staying in step with exciting technologies such as virtual assets will ensure that your organisation steers smoothly into a brighter future in 2023.
Connect with Abler Consulting here: https://www.ablerconsulting.com/
