5 Emerging Trends in Compliance
It’s easy to say that today’s compliance landscape is complex, but it’s another thing to be the person responsible for navigating an organization through today’s rapidly changing regulations. From innovations in technology to an increasingly global economy, changes in business are outpacing laws and regulations slow to keep up. In turn, business professionals can find themselves juggling more than ever.
At the start of 2020, Vicki Huebner, director of online legal programs at Santa Clara University, and Virginia MacSuibhne, vice president and chief compliance and privacy officer at Roche Molecular Solutions, sat down to discuss the major issues compliance officers face today. Both lecturers in law at SCU, the pair dissected five emerging issues in corporate compliance and how to address them.
From blockchain to artificial intelligence to robotics, the impact of technology can be felt in nearly every aspect of life, which is why it’s such a pressing issue in compliance.
“We’re certainly seeing leaps and bounds,” MacSuibhne said of technology’s rapid transformation. “Everything is getting smaller. Everything is getting faster in terms of computing, so that’s allowing a lot more flexibility and capability.”
There’s one particular trend that can create a host of problems for compliance officers: multifunctional devices. Whether it’s a smart phone, a smart doorbell, or a self-driving car, today’s devices have the capacity to record both audio and video, utilize voice control, and perform a multitude of other tasks, which means business professionals need to pay special attention to them as they become more popular.
As business becomes more globally focused, disruptions to workflow or a supply chain can be a headache to compliance officers. In addition to ensuring that any fixes still follow national and international regulations, business professionals need to have the knowledge to work alongside other partners to understand how any adjustments will impact costs, timetables, product standards, and business goals.
“They really need to have these competencies of understanding how to work with the business partners,” said Huebner. “They need to understand what the drivers are. They need to understand the value drivers for the firm and the organization—and how the value chain is working.”
A recent example is the U.S. legislation and charges against Huawei, the massive Chinese-based tech company, over security fears. The move is forcing compliance professionals and their partners to implement small and drastic changes in how they do business—very quickly.
“It's really hard in a global economy to respond to regulations, to respond to technology, and then to respond to what a competitive country is doing,” MacSuibhne said.
Speed of Transformation
It’s not just technology itself that’s impacting compliance, it’s how quickly it’s evolving.
“It’s impossible for the regulatory landscape to keep up,” MacSuibhne said. “This is just the way that regulations work. They're reactive in most cases. Unfortunately, something bad happens, and then we pass a law.”
Even when regulations are written to be proactive, that doesn’t mean every country or state holds the same viewpoints on an issue. This is especially true on an international scale. For example, the U.S. is one of several countries with bans on cloning research, but because many Asian countries do not, a massive discrepancy in global regulations exists for this emerging field.
Data Protection and Privacy
The best way to describe data security compliance laws might be the term “patchwork.” States like California are implementing their own data security standards, while proposed federal laws stand to make compliance more complicated. Internationally, Europe’s General Data Protection Regulation (GDPR) is providing another layer of discrepancies: Every country’s court is implementing the law differently, meaning Germany’s interpretation of the GDPR Is different than Denmark’s.
At Roche, MacSuibhne’s team tracks more than 250 different privacy laws around the world. Her approach to privacy and security compliance focuses on meeting the stricter privacy and informed consent regulations spelled out in Health Insurance Portability and Accountability Act (HIPAA), in addition to creating and implementing a principles-based approach to other compliance matters.
The new data privacy laws intend to give individuals more control and the ability to consent to their personal information being shared, whether they’re downloading a free app or purchasing a vehicle that requires a personal device. However, MacSuibhne has some reservations. Many of the new regulations don’t seem to target the biggest offenders. In addition, these privacy and IT compliance laws are often missing critical components around security (which HIPAA has strict guidelines for). Also, new data security and privacy laws often treat different kinds of data the same way. For example, someone’s medical information is treated exactly the same as their financial information. However, that also means their fitness app and daily step count is given an equal level of protection.
Diversity and Inclusion
Regulations on diversity and inclusion are not widespread. One of the most notable is a new California law which required companies with leadership based in the state to appoint a woman onto their board by the end of 2019.1 Even without legal mandates, MacSuibhne believes it’s important for compliance officers to look at the big picture and recognize the value of promoting diversity as an important part of a business. Researchers have found that as a company’s decision makers and workforce become more diverse, its profitability increases.2 A compliance officer can make the case as to why inclusion is ethically important and how it provides a diversity of perspectives that ultimately makes the organization stronger.
“That compelling vision has to be a combination of ‘here's why we're doing the right thing’ and ‘here's also how it's going to lead to a very virtuous, profitable cycle for us in the business as well,’” she said.
More Than the Essentials
Understanding that bigger picture is an important part Santa Clara University’s Online Master of Legal Studies (MLS) in Corporate Compliance.
In addition to being an expert in today’s local, federal, and global regulations, a successful business professional needs to be able to make the case for compliance’s value within the organization. Skills like communication, relationship building, and business competencies are integral to every course in SCU’s curriculum. Watch the video below to learn how Huebner and MacSuibhne bring that outlook to their online courses and to listen to their full conversation on today’s emerging business trends.
Apply today and begin developing the knowledge to become a leader in business.
1 Retrieved on February 17, 2020 from washingtonpost.com/business/2019/11/14/this-state-requires-company-boards-include-women-new-lawsuit-says-thats-unconstitutional/
2 Retrieved on February 17, 2020 from forbes.com/sites/karstenstrauss/2018/01/25/more-evidence-that-company-diversity-leads-to-better-profits/#5ae39be61bc7