What Is a Compliance Officer?

What Is a Compliance Officer?

Let me explain what a compliance officer does. I'm talking about an employee in a company whose job is to make sure the firm sticks to its external regulatory and legal requirements, along with internal policies and bylaws. If there's a chief compliance officer, that's usually the head of the compliance department. Your main goal here is to set up internal controls that properly measure and manage the company's risks.

Key Takeaways

You need to know that a compliance officer handles ensuring the company complies with outside regulatory and legal requirements. They're also on top of internal policies and bylaws. It's their duty to work with management and staff to spot and manage regulatory risks. And if there's a breach, they must have disciplinary measures ready to prevent it from happening again.

How Compliance Officers Work

As a compliance officer, you're helping the company maintain policies and procedures to stay within the industry's regulatory framework. Your duties might include reviewing and setting standards for external communications, like requiring disclaimers in emails, or checking facilities to ensure they're accessible and safe. You could also design or update internal policies to reduce the risk of breaking laws, and lead internal audits of procedures.

You have to know the company inside out and be aware of where regulatory breaches could happen. It's crucial that you communicate the company's key ethical principles and compliance regulations effectively. You'll organize regular training sessions for employees to cover key regulatory changes and updates—this is vital in a fast-changing regulatory environment. Work with business units and management to put contingency plans in place for responding to possible breaches.

If a regulatory breach occurs, you need appropriate disciplinary measures to avoid repeats. It's your duty to monitor and review compliance procedures continually to identify areas for improvement. You must provide an objective view of company policies, and resisting influence from others, including executives, is key to avoiding fines, sanctions, or even business closure. In larger companies, a chief compliance officer directs these activities.

Remember, compliance officers actively manage a firm's risk and reduce financial crime.

Becoming a Compliance Officer

To become a compliance officer, you need a unique skill set to ensure the company's operations comply with regulations and procedures. High ethical standards and honesty are critical, as you're responsible for adherence to required regulations.

You'll be reviewing others' work, so polished people skills and the ability to work well with colleagues are essential. Be reliable, show commitment to the company's regulations, and lead by example. Strong attention to detail is a must—you need to spot actions that could lead to liability.

This isn't an entry-level position. A bachelor's degree is usually the minimum, and some employers want advanced degrees like a law degree or MBA for higher roles.

In various sectors, you can pursue the Certified Compliance and Ethics Professional Program (CCEP) through the Society of Corporate Compliance and Ethics (SCCE). It involves an intensive course and passing an exam. Similar certifications are available through the Ethics and Compliance Officer Association (ECOA).

Based on BLS May 2020 data, annual salaries for compliance roles range from $40,160 to $115,220, with hourly wages from $19.31 to $55.39. Lower earners often have minimal experience or unrelated degrees. Higher earners have tenure, advanced degrees in business, accounting, law, or finance. At large institutions, you get fringe benefits, and chief compliance officers have packages comparable to other C-suite executives.