Since 2008 we have seen dramatic growth in the regulatory requirements facing corporations. Starting with Sarbanes-Oxley in the US, national and international regulations worldwide have been tightened or introduced across all industries, and in the financial services industry across a wide range of products. This development owes its existence to almost catastrophic misdeeds, mismanagement and manipulation in the financial system, and aims to change the way businesses operate.
Research shows that CEOs consider the regulatory environment to be a key challenge facing their organisations, leading those responsible for leading companies to spend more and more of their time with regulators and other government bodies. In some cases, this can be more than half a CEO’s capacity. This takes focus away from traditional operational management.
In the financial sector, regulatory measures target increased transparency and risk reduction, especially for the lay investor. But the number of new regulations is considerable. Recent developments such as the EU’s Markets in Financial Instruments Directive II (MiFID II) increase the burden on manufacturers, intermediaries and sellers of many financial products. And this applies not only to organisations resident in the EU, but also to those wishing to sell their products there. The consequences of non-compliance can be dramatic.
Regulatory compliance was traditionally seen as something of a back-office activity. It was a necessary evil with no real impact on business operations or strategy. A drag on efficiency and corporate profit, it added no value. Given the drastic shift in requirements, this has to change if companies are to gain anything from an operational perspective.
How can companies make the best of this current environment to turn it into a competitive advantage? It can serve as a basis for improving a company’s standing, instead of simply wasting valuable company resources on compliance. Companies can gain ground on their competitors and improve client confidence and trust by offering transparent products, with the regulator’s seal of approval. New regulations can also provide the impetus to re-engineer an organisation and processes in line with the environmental framework. This will bring efficiencies, transforming an organisation into one able to benefit from increasing change and demands.
How can a language service provider help?
Clear and efficient language is critical to meeting compliance requirements, to creating a competitive advantage and to driving a company’s internal change processes. Particularly as the regulatory framework targets the provision of clear and efficient communication to third parties.
Diction’s expertise and experience lies in creating clarity in corporate communication, for all purposes, and especially in translating and refining financial and regulatory communication and marketing. We can reflect the latest requirements in transparent and effective documents for a wide range of users. And ensure both that requirements are met and that the communication serves a convincing commercial purpose.
Peter Riley, Head of Financial Translations