According to compliance leaders that we met, companies in the oil and gas sector face “significant pressure” to reduce expenses across all departments. Compliance teams are not exempt. Leaders are finding it increasingly challenging to meet constantly changing regulatory requirements while keeping costs down. At the same time, risk and compliance teams are “expected to do more… but without more money and more people.” Teams are being tasked with overseeing a broadening spectrum of risks, including supply chain integrity, trade compliance and export control, human rights due diligence, and other reputational risks. Leaders look to technology as a way to handle these increased workloads while also reducing costs.

Some leaders are addressing cost pressures by restructuring their teams. This involves eliminating “low-value work” and consolidating risk profiles to maximize the existing workforce’s ability and improve operational efficiency within the compliance function. In some cases, the creation of centers of excellence is being pursued to drive efficiency.

Others are addressing the challenge by pushing compliance tools and procedures out to business users across the firm. The expectation is that if employees have what they need from a compliance perspective, they will become self-sufficient for most cases and only escalate the highest-risk issues.

Compliance teams are cost centers that need to constantly demonstrate their value to the organization – but this is not straightforward. As one leader put it, “demonstrating value is a real challenge because if you’re really effective, stuff doesn’t happen, and people ask, ‘Why do we need you?’” Compliance teams are therefore re-considering what the best KPIs are to measure and how to report this to their organizations’ boards. Beyond reporting KPIs, leaders understood that they also must “improve how we tell our story” by leveraging data more effectively and creatively.

Insights from Dow Jones

Continue to identify lower-value tasks across the risk and compliance function to automate. Doing so may allow teams to consolidate roles and responsibilities to create availability for the ever-broadening scope of work that risk and compliance teams are expected to perform. Would better tools lead to a reduction of overall spend?

Dispersing risk and compliance tools to functions across the firm relieves the workload and pressure of being a real (or perceived) bottleneck.

Review your risk-based approach – consider whether you are focusing the right level of resources on the right risks. Some due diligence programs remain unsophisticated in their risk assessment.

Consider how you can share knowledge tools and insights with your organization’s board to ensure they are aware of the strategic risk environment that your teams are monitoring and managing.