Pennell Hart: Women in Compliance

SO: For many people the route into compliance is nonlinear, can you tell us how you entered the profession and what motivated you to pursue this career path?

SG: My career in compliance began around 17 years ago; given that compliance was not a separate and well-known discipline at the time, like many others, I stumbled into it.?

I am a Chartered Accountant by background, and I was working in an audit firm in Dubai.?After 10 years of long working hours, I decided I wanted to spend more time with the kids.?I was offered a part time assignment by HSBC as the Sarbanes Oxley lead, on an 18-month contract.?This resulted in me getting the tag of a “compliance expert”, and thereafter I was recruited into HSBC’s compliance department, for the investment bank. And that was just the beginning-I loved it right from the start, and I’ve never looked back!

So I would say that Compliance chose me, not the other way round!

SO: What are some of the common misconceptions about compliance, and how do you work to dispel them?

SG: One of the most common misconceptions in a business environment is that compliance is a department which hinders business, and which just says “no”.?

Business therefore tend to not communicate with their compliance department or have a difficult relationship with Compliance.?I think that it’s important to make our business partners understand that Compliance protects the interests of the organisation as well as the individual, ensuring that there is no misstep which could lead to reputational damage or regulatory censure.?I think that it’s also important to demonstrate to business that Compliance will always try to be pragmatic and business focused, but within the regulatory and reputational limits.?When I worked at a Bank, I always told my teams that when I say “no”, the CEO respects that, because he knows that I have tried to find a pragmatic but compliant solution, and that it just wasn’t possible.?It’s all about building trust!

SO: How important is it that organizations have a robust ethics & compliance function, especially here in the UAE? ?

SG: I think that it is of paramount importance that organisations have a robust ethics and compliance department.?This ensures that employees understand their obligations and responsibilities, and also understand what is prohibited or restricted by the organisation or the laws and regulations of that country.?

In the US and Europe, markets are more developed, regulators and regulations are well entrenched, with an established and robust punitive regime.?The need for ethics and compliance becomes even more relevant in the UAE as the regulatory environment and framework, especially onshore is still quite nascent.?Whilst regulations such as consumer protection have been issued, it is still early days.?And this is of course, only in the financial services sector.?Other corporates may also need a compliance and ethics function, where there are limited or no regulatory or legal requirements.

SO: How has compliance evolved in recent years, and what do you see the most significant trends and changes?

SG: With machine learning and AI, digital disruption and now CHAT GPT, the ways of doing business are changing swiftly, and innovation in Compliance is not far behind.?The most significant trends include:

·??The use of new technologies to make decisions to prevent and detect fraud, money laundering and sanctions activity.

·??In financial crime, human intervention can now be limited to the special and more complex cases, with false positives, name matching etc. ?being sifted by the system.

·??Regulations are required to keep pace with the fast-paced innovations such as crypto and digital assets and there is a need for regulators to be nimbler and more proactive.

SO: What do you think are the most important qualities for success in compliance, and how can people develop these traits?

SG: Whilst a lot of compliance officers tend to be lawyers or accountants, I think it is more about the skills that these professions bring to the table.?To be a successful and effective Compliance Officer, one needs to have certain qualities including analytical skills and good reasoning, effective communication skills, an open mind, excellent execution skills and the ability to listen.??

SO: What are some of the most rewarding aspects of your work in compliance, and what keeps you motivated to continue in this field?

SG: I have worked in compliance for 15+ years, out of which the last 6 were in regulatory compliance, including conduct.?I find conduct and culture especially, highly challenging as the needle has not yet moved as far as it needs to in this area.?There is still a lot of work that needs to be done to change hearts and minds and that’s very interesting.

Some of the most rewarding parts of working in compliance include building and leading quality teams in a discipline which is still gaining respect, and it’s the “aha” moment when hard core business partners understand what you are trying to communicate.

SO: In your opinion, are companies in the region committed to investing in their compliance programs?

SG: I have been in the UAE for more than 25 years and been responsible for compliance over the last 17 years; so I have seen it evolve from a non-discipline to a required department in the financial services sector.?That said, I believe that companies are still hesitant to invest in compliance, be it in people or technology.?I think that the mindset, apart from a few players, is still of “making do” and treating compliance investment as a last resort, often after a regulatory remediation or sanction.?These entities are still in the mind-set of seeing compliance as a bit of a nuisance and a department that doesn’t generate revenue.?I don’t believe that companies in the region are investing into compliance the way they did into credit risk a few years ago-that said there is a very slow change ongoing….

SO: How has the compliance market changed since you have been based in the UAE market and what do you think has driven this change?

SG: As I mentioned, I have been in the UAE for more than 25 years and have seen the change of compliance as a department in financial services firms, but have also seen the evolution from a regulatory perspective including the establishment of the financial free zones.?The quality of compliance personnel has also significantly improved, especially with diplomas and certifications which are directly focused on compliance.

I think that the regulatory environment, both onshore and offshore has been the catalyst for this change over the years.?And this positive change in the regulatory environment has of course been impacted by the wider global regulatory drivers, for example the FATF requirements or the requirements of OFAC which are imposed on USD clearing members.?The local regulatory environment has undergone tremendous change through the establishment of various regulators, more robust and quality supervision, a host of regulations especially outside of just AML, which has seen a great impact on the market.

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SO: What are the major challenges you face in your current role and how do you overcome them?

SG: Having started my own compliance consultancy in 2021, I no longer work in the financial services sector, but am looking to support this sector, either directly, or through collaboration with other more established consulting firms.?As my specialisation is regulatory compliance, I find that my biggest challenge is to convince financial services firms, both on-shore and off-shore to invest in programs on conduct and culture.?This seems to be an area which is being taken seriously only if an entity is sanctioned by the regulator.?I thereof feel that conduct and compliance are still seen as “nice to have” and not taken as seriously as financial crime compliance (i.e. AML, sanctions, ABC).

SO: What do you think the major challenges are from a team recruitment perspective?

SG: I believe that even with the diplomas and various programs out there, experience and quality compliance officers are still limited in the Middle East.?The good ones are therefore moving from one entity to another for more money, and the smaller firms suffer as they cannot pay large amounts.?There does seem to be some influx of more junior compliance officers coming in from outside the Middle East, which might help to alleviate the problem a little.?The other significant problem is the paucity of Emirati compliance officers-these are even more difficult to find and then retain.?Banks especially need to put in much more investment to train up Emiratis, but this can be challenging as Compliance is not perceived as an attractive profession (partly due to the salary scales).

SO: Pennell Hart plan to gather some solid data on this over the next few months so the facts remain to be seen, but do you feel women are well presented at leadership level in compliance in the region? If so, what are some of the key skills and experiences that women bring into the field of compliance, and how do you see diversity impacting the industry??If no, how can this be addressed?

SG: In my opinion, there are a significant number of women in compliance in the region, perhaps because a role in risk tends to attract more women than men.?That said, it is always a challenge to find women in the senior roles, and like any other industry this is due to a combination of factors.?I have recently seen various appointments of women to senior roles especially in the UAE, which is heartening.

SO: For all those fresh-faced female graduates who are considering a compliance career, what advice do you have for them and what steps should they take to get started?

SG: I would say that women graduates should seriously consider a career in compliance as it is challenging and fulfilling.?They should look to complete a degree or diploma in compliance to get some initial credibility and think about what area of compliance they like.?I have thoroughly enjoyed my career in compliance and continue to do so and would recommend it wholeheartedly.

SO:?Tell me something about yourself that has nothing to do with compliance…

SG: Since I’ve started my compliance consultancy in 2021, I have had the opportunity to do a number of things that I’ve always wanted to do, but never had the time for in my demanding career.?Two things that I have done since then which give me great joy are as follows:

·????????I’ve completed my coaching certification about 18 months ago and coach both executive clients and do lifestyle coaching.

·????????I learn French and I decided to take a month off this year to go to France- and have now enrolled myself into an intensive course.

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