What Does a Compliance Manager Do?

Updated on December 16th, 2021
What Does a Compliance Manager Do?

A compliance manager's responsibilities can be both challenging and rewarding. Compliance managers are responsible for making sure that all company policies and procedures are followed by employees, vendors, customers, and third parties.

They put in place proactive measures to prevent illegal or unethical practices from occurring within an organization. Compliance managers, in essence, keep the company safe from legal and financial risks.

This blog post will explore the responsibilities of a compliance manager and what it takes to become one. It will also cover the skills that you need to have, as well as the qualities needed for this demanding position!

What is Compliance Management?

Compliance management is ensuring that the company's policies and procedures are followed. It is the process of overseeing that any company procedures are aligned with the laws and regulations of the industry. These regulations are called compliance benchmarks, which have to be followed by the officials.

All the business strategies and policies have to be developed according to these compliance benchmarks and rules. This is crucial because it will make sure that the company is not breaking any rules, which can lead to fines and penalties.

In addition, compliance management focuses on correcting business issues when they occur by identifying them early on. It also supports risk assessment in organizations.

You can consider compliance management as a combination of regulations, policies, practices, documentation, and auditing. If the current regulatory standards change, so will the compliance benchmarks for the company. The entire compliance management process will cover the federal and international regulatory changes.

Legal Compliance 

This is very important in any compliance strategy. Legal compliance comes into play when you've signed a contract with customers or a business partner. So, if the company doesn't adhere to the legalities of the contract, it can face hefty penalties and litigation. It might also lead to the imprisonment of the senior officials.

Compliance management helps in preventing any breaches of contract clauses and makes sure all parties are happy.

Compliance Strategies 

Examples of different types of compliance strategies include policies set up by senior managers and other employees. This includes complying with legislation sets out by international law enforcement agencies (including various countries). This can include creating guidelines on how to avoid criminal activities like bribery, legal fraud, and money laundering.

Who is a Compliance Manager?

A compliance manager is a professional who will be accountable for the compliance of your company. The position is very important because they are in charge of designing and implementing a regulatory strategy that ensures legal compliances while also preventing any major issues or violations from occurring.

The compliance manager also ensures that all departments are following the rules established by the company. These professionals always stay updated about the latest changes in laws and regulations. Subsequently, they also prepare reports and submit them to the senior officials.

It's also important to note that compliance managers work closely together with their legal departments and corporate lawyers. They check whether all departments are in sync with the legal divisions. 

Compliance Manager Roles And Responsibilities

The responsibilities of a compliance manager include complying with the legislation set out by international law enforcement agencies (including various countries). This can include creating guidelines on how to avoid criminal activities like bribery, legal fraud, and money laundering.

Ethical And Legal Compliance 

As you might imagine, this is an important position that covers a lot of aspects. The compliance manager takes care of the organization's ethical and legal compliance. It's important as the compliance practices by any organization reflect their dignity and sincerity.

Compliance managers also perform supervision and control of the company's interests. They are in charge of ensuring that all employees within the organization comply with all the applicable laws and regulations.

Compliance Sessions And Training 

Compliance officers also have the responsibility to conduct training sessions and programs about compliance. In many cases, the compliance managers will create a compliance training program for all employees.

In these training sessions, compliance managers talk about the company's regulations and laws. They will also discuss and train employees on how to adhere to the compliance laws and maintain legal balance within the firm. These sessions are very beneficial for new employees and compliance officials.

Compliance Audit Management 

Compliance officers also need to audit the company's compliance policies and procedures. They will often use computer software or other methods such as manual logs that are maintained by their staff members.

The goal is to identify any violations of laws, regulations, ethical behavior, and even operational errors. They might conduct these audits on an ongoing basis, or they may just occur once every few years for large companies with complicated operations. The more systems are in place, the less likely there will be possibilities of human error.

Duties Of A Compliance Manager

Let’s take a look at the roles and duties of a compliance officer -

  • Checking that employees are following guidelines set for data protection, the privacy of personal information (including customers)
  • Overseeing financial activities like fraud prevention and whether the company complies with export restrictions
  • Monitoring and enforcing compliance with the law, ensuring that records are accurate
  • Evaluating risks to ensure the company is complying with all applicable laws
  • Answering any questions about what it means for a business to be compliant and communicating that with other employees
  • Oversee the compliance relates tasks performed by colleagues
  • Tackling the information flow inside the organization
  • Create, enhance and implement compliance policies for the company's benefit
  • Analyze the compliance control systems of the company and suggest areas of improvement
  • Identify the risks associated with the control systems
  • Audit the organization's procedures and regulations to keep them up-to-date
  • Lead a team of compliance professionals and oversee their performance

Compliance Manager Skills

A person must have certain skills to be successful as a Compliance Manager. Leadership, risk management, negotiation, and interpersonal skills are all essential qualities for this role, along with specific industry knowledge, including laws, compliance rules, among others.

Other skills required for a compliance manager include excellent communication, leadership, analytical thinking, and interpersonal skills (particularly when dealing with other cultures).

A successful compliance manager needs not only to be knowledgeable about the laws they are enforcing but also have great organizational skills for overseeing departments in their company.

Finally, most importantly, perhaps, they must demonstrate integrity when dealing with sensitive data related to people's personal information or financial records because it risks jeopardizing the trust customers put into them.

Qualities a compliance manager must have are -

  • They need strong communication skills so as to work well with other employees and external entities such as government officials or regulators
  • An analytical mind and excellent problem-solving skills
  • As compliance audits and associated tasks can get complicated, attention to detail is a vital quality for compliance managers
  • Sound knowledge of the various reporting processes of the firm
  • Strong ability to assess risks about the credit union and litigation possibilities
  • Decision-making skills to handle the risks and recommend solutions
  • The compliance managers must have the potential to understand what the company is trying to achieve in terms of compliance
  • A high sense of responsibility and the ability to work independently under challenging circumstances 
  • They also have to be good team players and coordinate with all team members effectively 

How to Become a Compliance Manager?   

If you want to become a compliance manager, you need to have certain prerequisites such as degrees and certifications. However, the most important requirement is the knowledge of compliance and how to apply the processes for organizational development. 

Let's have a look at them in detail.

Education    

A compliance manager must have at least a bachelor's degree in business, finance, or economics. Most compliance officers are law graduates and have a strong foundation in corporate law and associated legal policies.    

Training 

They should also go through formal training and gain on-the-job experience in the field of regulatory compliance management. Compliance professionals start from entry-level positions and move forward by gaining experience. Having 2 to 3 years of experience is helpful to get promoted to compliance manager positions.

Certifications 

Candidates interested in compliance manager positions can try getting a certificate in their related industry. The most popular certifications are -

  • Certified Regulatory Compliance Manager (CRCM)
  • Certified in Governance of Enterprise IT (CGEIT)
  • Certified in Risk and Information Systems Control (CRISC)

Summing Up

A company may be successful in its business operations, but if they aren't following legal policies, their future won't be smooth. To prevent any legal problems and lawsuits to hinder business growth, every company will require compliance managers. These professionals will take care of all the compliance issues so everything else can run smoothly.

A compliance manager will work with various departments in the company to manage and maintain regulatory requirements. As they do so much for the company, they are highly paid too. The starting average annual salary for compliance managers is around $50,000. With years of experience, this salary can go up to $120,000 per year.