What do regulators have in mind for 2012?

This year, many companies faced a series of regulatory hurdles that seemed nearly impossible to overcome. Some were unprepared and not in compliance with new regulatory provisions.  

Corporate secretaries have numerous responsibilities so sometimes managing the volume of regulatory change can be a big challenge – especially on an international level.

According to risk and compliance experts at Netherlands-based Wolters-Kluwer Financial Services, there are three regulations that will continue to take the spotlight as companies move forward into 2012: Dodd-Frank, Basel III and Solvency II.

Other C-suite executives, such as chief compliance officers (CCOs), share the heavy burden of keeping the company abreast of regulatory changes. In fact, a recent survey released by investment processing service SEI reveals that 59 percent of CCOs feel their laundry list of responsibilities is impeding their ability to serve as effective officers; and for 28 percent a shortage of resources or funding represents a major challenge.

‘CCOs continue to be asked to do more with less, and there doesn't appear to be much relief in sight,’ says Jim Volk, CCO for SEI's Investment Manager Services division. ‘With ongoing SEC rulemaking activity, the regulatory environment is constantly changing, so most CCOs need help just to keep up.’

Regulations 2012

For 2012 the legislative behemoth Dodd Frank has the US securities and banking industries on its toes, as some of the act’s implementing rules are being modified and are awaiting effective compliance dates in the coming months, says Wolters-Kluwer.

In the world of insurance, right around the globe, insurers are closely observing how Solvency II will impact European insurers and those situated in other countries. Meanwhile, financial organizations that operate in multiple countries ought to have a clear understanding of how Basel III applies to different regulatory jurisdictions.

‘It doesn’t take super powers to see that new and increasing regulation will continue to have a significant impact on financial services institutions worldwide,’ says Mike MacDonagh, an enterprise risk management content strategist. ‘The significant new prudential regulations, such as Basel III and Solvency II, are rafts of new conduct of business regulations around anti-bribery and corruption, fraud, tax avoidance and, of course, the wide-ranging Dodd-Frank Act. All of these will keep risk and compliance officers busy but there are other areas that they will need to focus on as well.’