Compliance Key Performance Indicators (KPIs): A Guide to Effective Monitoring

Why KPIs are Important

Compliance KPIs play a crucial role in helping organizations assess whether their compliance efforts are driving the company in the right direction. By tracking these metrics, you can:

Identify areas of improvement
Measure the effectiveness of your compliance program
Make data-driven decisions to enhance compliance strategies

Types of KPIs

To effectively monitor compliance, it’s essential to focus on directional, specific, and measurable KPIs. These include:

Directional KPIs

Mean time to issue discovery: The average time taken to identify a compliance issue
Mean time to issue resolution: The average time taken to resolve a compliance issue

Specific KPIs

Compliance expense per issue: The cost associated with resolving each compliance issue
Total regulatory compliance expense: The overall cost of maintaining a compliance program

Measurable KPIs

Risk severity gap: The difference between the perceived and actual risk levels within your organization
Composite risk index: A comprehensive measure of an organization’s risk exposure

Compliance KPI Examples

In addition to the above, other important compliance KPIs to track include:

HR regulatory compliance expense
Compliance training expense
Compliance training headcount
Number of misconduct reports

FAQs

Q: How do I measure my compliance rate?

A: To measure your compliance rate, you can use a combination of directional, specific, and measurable KPIs. This will give you a comprehensive understanding of your organization’s compliance performance.

Q: What makes a good compliance function?

A: A good compliance function is one that is proactive, risk-based, and aligned with the organization’s goals. It should also be transparent, accountable, and responsive to regulatory requirements.

Q: How do compliance tools help?

A: Compliance tools can help streamline your processes, reduce costs, and improve efficiency. They can also provide real-time monitoring and reporting capabilities, enabling you to make data-driven decisions.

Conclusion

Effective compliance strategy is crucial for organizations to prevent financial loss, reputational damage, and reduced staff morale. By tracking the right KPIs and using the right tools, you can ensure that your compliance program is robust, effective, and aligned with your organization’s goals.

ComplyLog offers a suite of tools to help you stay compliant with key pieces of legislation and streamline your processes:

IntegrityLog: enables fulfillment of the EU Whistleblowing Directive requirements
InsiderLog: automates insider list management as per MAR
TradeLog: makes managing employee personal trading easier and faster

Request a free demo of each tool by clicking on the links above.