Corporate Vision March 2017

CORPORATE VISION / March 2017 7 NEWS , The Senior Manag- ers & Certification Regime (SMCR) has already had a posi- tive impact on the fi- nancial services sector, according to a survey of nearly 200 senior financial services executives polled by Duff & Phelps. 55% believe the SMCR has positively affected the banking and alter- native investment communities, whilst just 15% say it has had a negative impact. With the first anniversary of the regime on March 7, firms have seen a real change in culture over the last year in what might now be considered a watershed regula- tion for the UK financial services sector. Monique Melis, Managing Di- rector and Service Line Head, Regulatory Consulting comments on the findings: “The threat of personal sanctions is ensuring compliance functions put their du- ties before other considerations. Where managers fail to support them, they themselves may face penalties. We have seen SMR start to change the way compli- ance departments budget. “They are not just counting com- pliance costs, but the costs of hiring a replacement compliance officer or interim staff, for regu- latory penalties and remediation in cases of failure, and for their own personal liability if things go wrong. In short, this regime may have been a game-changer after all. Almost a decade after the fi- nancial crisis, cultural change in financial services is finally starting to happen.” Duff & Phelps surveyed 183 sen- ior financial services executives, compliance professionals and investment managers operating in the US, Europe and Asia. This was conducted in conjuncture with Duff & Phelps’ Global Reg- ulatory Outlook report and re- spondents were contacted in Q1 2017. Dean Curtis, Managing Director at LexisNexis® Risk Solutions, comments: “Broadening the scope of personal accountabil- ity across the financial services Research published in the Loyalty Pre- mium Report 2017, published by rewards and incentives pro- vider, One4all Rewards, investi- gated a number of costs involved in staff departures, and revealed the value of loyalty, based on the average UK salary of £27,645, stands at £6,335.31 per employ- ee - or 23% of the average annual wage. Sums included were the average notice period, recruitment fees for hiring replacements and the amount of productivity that is lost once notice has been handed in. The premium of loyalty remains at a steady 23-25% of a workers’ annual wage, as salary bands in- crease. And with the survey of 1,002 UK full or part time workers reveal- ing that more than 1 in 5 (21%) have been led to consider getting a new job, too, as a result of a col- league resigning, this will make for worrying reading for many UK business owners. Declan Byrne, managing director at One4all Rewards commented: “Most employers know that hav- ing staff resign is not only incon- venient but also costly. But the combined total of the recruitment costs, productivity losses and more that are associated with this may come as a bit of a shock, and it is no meagre sum. “To avoid such costs mounting up, it is important that businesses take employee morale seriously, and actively take steps to ensure staff feel happy, motivated and appreciated. Even something as simple as an annual token of ap- preciation - such as a bonus - can go a long way. “ The research also revealed the aspects that play the most signif- icant parts in workers’ decisions to stay at a company for the long term (e.g. five years or more). A nice working environment, reg- ular pay rises and long term ben- efits such as pensions and health insurance were the top three things likely to have the most sig- nificant impact on workers’ sense of loyalty. Monetary rewards such as gift cards and cash bonuses were also key for 1 in 3 workers. One4all Rewards are industry experts in benefits and rewards. Working with over 6,000 busi- nesses of all sizes nationwide, One4all Rewards helps to trans- form customer and employee relationships through successful rewards and incentive schemes. For more information and to read The Loyalty Premium visit www. one4allrewards.co.uk market has clearly had a positive effect. In truth, financial crime professionals have always been highly accountable – but by mak- ing other senior individuals just as accountable, the SMR has improved communication, col- laboration and ownership across different business functions. As a result, issues raised by Money Laundering Reporting Officers (MLROs) that impact compliance fall on more receptive ears. In- creased personal liability has therefore not only fundamentally shifted corporate mentalities, but also improved day-to-day pro- cesses in many banks. “However, there is still pressure to resource experienced financial crime professionals. Following the introduction of the SMR few- er professionals are considering leaving their jobs than first feared, but it is becoming a barrier to hir- ing for such positions – particu- larly quality talent for retail and investment banks.” Jennyfer Stanley, Senior Direc- tor at Synechron Business Con- sulting says: “At the senior level there may be increased scrutiny of appropriateness during the in- terview process, but we have not seen or heard major impact on hiring. What is more evident is that as part of mandatory training, the message is stronger regard- ing personal accountability. It is everyone’s responsibility regard- less of level of seniority in the firm and everyone is directly or indi- rectly accountable for the safe- guarding of the firm’s reputation. We also see such training and re- certification of adherence to con- trols, policy and procedures hap- pening at a more frequent level as a reminder of this responsibility. “Banks will also need to have a process of continuous review of their controls, policies and proce- dures to keep up with the chang- ing banking landscape and deter- mine ongoing appropriateness. This is critical.” www.duffandphelps.com The Value of Employee Loyalty Revealed The value of employee loyalty has been valued at almost a quarter of the average UK worker’s annual salary, according to new research.