Prevent The Danger of Silos with Mock Audits


It’s an easy trap to fall into – becoming immersed in your department’s priorities can be like being engulfed by wheat, corn, etc. in an actual silo.  The result is an inability to see and recognize the other resources harvested at the same “farm.”  When resources collaborate though – they mitigate systemic risks. This is the time of year compliance officers should consider inventorying systemic risks and planning for the year ahead. One approach is to conduct a mock audit to test controls, help breakdown unhelpful silos and adopt best practices, particularly on the higher risk topics.

The Opportunities

Management often does not realize how compliance can contribute to sustainable business growth.  Consider what can happen when compliance isn’t integrated effectively.  If a compliance officer works in an organization where Compliance is not included in strategic initiatives until the last minute when there is not enough time to study the impact of the issues, inefficiencies grow as compliance or independent consultants audit and find control gaps after a new product is designed or new system is launched.  For example, time and money may be wasted marketing new products if a compliance officer is brought in too late to address issues. The product is already baked, so Compliance fixes are more likely to be bolted on instead of baked in. Product developers may not focus on avoiding conflicts of interest, self-dealing, and unfair expense allocations.  Recently, Deutsche Bank offices were searched as part of a money-laundering investigation, in the latest example of an allegedly siloed compliance culture because suspicious activity reports were not allegedly not handled as required.

The dangers of siloed compliance can be avoided with collaborative risk assessments and independent audits of the business including high-risk products and new technology. This approach will arm compliance officers, so they can help grow and sustain the business at the start of 2019. It will also serve as protection against any regulatory investigations into the adequacy of the compliance program.

Changing the Perception and Building Influence

To avoid the inefficiencies and disruptions of silos, the key is for compliance to become an influential participant in the business and develop metrics to illustrate its value-add.  Read my previous post on how to increase influence and play a more integrated role across the company.  Also, learn more about developing your skills and building Sustainable Governance within your organization by visiting