Compliance Officers are Almost Never Promoted Within Their Companies – Why?

Article by Yana Afanasieva

Compliance officers are almost never promoted within their companies and have to change jobs to get ahead – it’s just statistics. Since I often help my FinTech founder clients to interview their compliance leaders and regularly give feedback about their existing teams, I think I have a perspective.

Most compliance experts believe that their success is determined by:

  • How well they know the laws and regulations, and
  • How hard they work (hard work here means long hours, lots of stress, little support, and plenty of uncertainties)

…And I’m going to argue that hard work and deep knowledge will rarely if ever get you a promotion within compliance.

Yes, you need to know the laws and put in some effort, sure, but your success and career progress within FinTech will have almost nothing to do with knowledge, stress, and long hours.

The finTech industry is very competitive, and it struggles with profitability and scaling challenges. Founders and investors alike are looking for compliance to help to solve these two problems (profitability and scale) and there is only one efficient way to approach it – manage and deliver compliance projects as agile and lean tech projects. If you look at your compliance role as a “job” and a series of tasks and activities, you’ll likely never get ahead, because you won’t be delivering what your management expects you to deliver. Management does not want perfect compliance, they want things done (yesterday), more customers, more investors, more revenues.

The compliance function is not just onboarding, scanning, monitoring, approving, or risk rating customers or producing reports (this is pre-2008 crisis old-fashioned thinking if you ask me).

In 2021 and beyond, the compliance function is normally expected to deliver 1-2 large projects a year (new license, the launch of new products, new partnership, implementation of future PSD3…) and everything that happens must be subordinated to these goals.

Let’s look at a licensing project as an example.

I’d like to suggest that the only way to efficiently and cost-effectively go about securing a financial license with all the resources, time and team constraints is to establish it as a lean-agile project and manage it as a lean-agile project.

What I mean by this is the following: you need to understand the phases of your project (the application process in this case) and what actions and deliverables will help you make progress at each phase, and you focus on what is important at each phase.

When you concentrate on the right sequence of deliverables during the right time of the licensing process, and you know your next milestone, you can track your progress better, you can plan resources better and you no longer need to chase down millions of different ghosts, perceived problems, and non-essential issues that are likely not even relevant. Plus, if you never managed a large-scale compliance project, such as securing a license, you won’t be seriously considered for the CCO role in this day and age.

You may be arguing in your head – “but that’s not compliance role to manage projects and plan resources, I need a business owner or a project manager to do that…”

Well, think again. Your management and founders think it is the compliance leader who should be driving this because they don’t fully understand the risks and consequences, so you really have two options:

  • Either you learn how to manage and deliver compliance projects as a new generation compliance leader, or
  • You will keep failing and changing jobs