Financial Crime World

Compliance Key Performance Indicators (KPIs): A Comprehensive Guide

Introduction

This guide provides an in-depth look at key performance indicators (KPIs) for compliance, including explanations and examples. It covers various aspects of compliance KPIs, such as directional and specific goals, as well as the most important compliance KPIs to track.

Understanding Compliance KPIs

Directional KPIs

Directional KPIs help you understand whether your business is improving in certain elements of your compliance efforts. This includes:

  • Increasing internal audits completed on time: Set concrete goals, such as increasing the number of internal audits completed on time by 10%.
  • Improving regulatory compliance expense: Track changes in total regulatory compliance expense and identify areas for cost reduction.

Most Important Compliance KPIs to Track

The following are some of the most important compliance KPIs to track:

  • Mean Time to Issue Discovery (MTID)
  • Mean Time to Issue Resolution (MTIR)
  • Compliance Expense per Issue
  • Total Regulatory Compliance Expense
  • Risk Severity Gap
  • Composite Risk Index
  • HR Regulatory Compliance Expense
  • Compliance Training Expense
  • Compliance Training Headcount
  • Number of Misconduct Reports

Frequently Asked Questions

Measuring Compliance Rate

Measuring compliance rate involves tracking the percentage of employees who complete compliance training and adhere to company policies.

What Makes a Good Compliance Function?

A good compliance function is one that:

  • Has clear goals and objectives
  • Is proactive in identifying and addressing risks
  • Has effective communication channels with employees
  • Provides regular training and updates on compliance policies

How Do Compliance Tools Help?

Compliance tools help by:

  • Automating reporting and tracking processes
  • Providing real-time data analytics
  • Identifying areas for improvement

Conclusion

This guide emphasizes the importance of continually improving your efforts to eliminate wrongdoing and suggests that making sure you are instilling a compliance culture is in the best interests of the business. It also provides references for further reading on various topics related to compliance.

Additional Resources