Accenture Capital Markets Blog

By 2023, roughly one out of every ten dollars a financial institution earns in revenue will be spent on complying with regulatory requirements.[i] Think about that.

But the dollars spent on compliance definitely beat the alternative—money spent paying fines because a financial institution doesn’t adequately meet a regulatory requirement. For instance, the projected spend on Anti-Money Laundering (AML) compliance across all U.S. and Canadian financial services firms is $31.5B.[ii] I don’t need to remind you of the headlines; we’ve all read them.

2019 RegTech investment is strong

It’s no wonder, then, that 2019 has already been a strong year for global RegTech investment.

RegTech leverages cloud and digital technologies to help financial firms comply with regulations consistently, proactively and transparently—all at a cost that beats doing things the traditional way. Research shows U.S. and Canadian firms that effectively use compliance technology are able to realize a lower average cost per full-time-employee (FTE) than firms that don’t.[iii] More than half (54%) of the average compliance process in a North American firm involves manual effort, according to the same study. That’s too high.

Source: Fintech Global, 2019[iv]

Not only is it too high, it simply won’t work due to finite human capacities. Without the vast speed and capacity of artificial intelligence (AI), financial firms simply won’t be able to keep up with an increasing number of complex and shifting regulations. According to a report from the UK’s RegTech Council, the rules in the Markets in Financial Instruments Directive (MiFID) II alone take 30,000 pages and 1.5 million paragraphs to describe. You could hire an army of humans and it would still take them an inordinate amount of time to decipher the complexities of just that one directive—if they were ever truly able to master it.

I’m talking with clients who are fast developing a sense of urgency around RegTech. Many are considering and implementing RegTech throughout their operations, from onboarding, monitoring and detection, to reporting and process controls. And many, admittedly, are asking for help because they are confused and overwhelmed by the multitude of technology options and RegTech vendors.

Empowering wealth management compliance officers

As wealth managers transform their advisor and client experience, a similar digital transformation is needed for compliance officers. With half (50%) of financial firms facing a level of unmanaged employee attrition that is above expectation, it’s more important now than ever to equip compliance talent with modern and insightful tools to sustainably deliver their responsibilities.[v]

I know, I know. It sounds very self-serving for a management consultant to say you’re best served by working with a trusted partner. But it really is true. I don’t know of a compliance officer that isn’t comparing the cost of FTEs to the need for investments in an always-on RegTech capacity. They want help from someone who speaks the RegTech language, who brings financial industry expertise, but also comes with a comprehensive knowledge of how to apply technology to the unique business regulatory compliance hurdles of financial firms. They need a partner that spans that entire ecosystem, from end to end—and puts that knowledge to work in their best interests.

That’s understandable and I’m sure many of you in compliance functions are nodding your head, especially since roughly 89% of you expect investment in compliance to rise over the next two years.[vi] To gain better command of all data related to compliance, to protect your business processes and to remain aligned to ever-changing regulations, you need the firepower of AI. You can’t match it for speed, breadth and depth. Of course, you’ll need humans who can work with it strategically—and yes, you’ll be competing for that scarce talent alongside your peers across industries.

RegTech in action

From know-your-client rules and AML oversight, to employee surveillance and enablement of a better client experience, RegTech holds huge possibility.

Some financial companies are already reaping benefits. Chris Enright, President and Managing Director of Aligned Capital Partners Inc. is already embracing Regtech. I spoke to Mr. Enright and he explains, “We expect to continue to make significant investments in implementing Regulatory Technology in order to achieve two major benefits. First, we anticipate improved investor protection; and second, the reallocation of human capital into areas that will drive new business opportunities for our firm.”

I recently served as part of a panel at the Annual Leadership Conference for The Investment Funds Institute of Canada. We discussed the many ways RegTech compliance solutions can enhance the investor experience and client outcomes. Please see below for the thoughts of two of my fellow panelists, one the CEO of a RegTech company and the other a board member for the Canadian RegTech Association.

If your firm is caught up in the confusing web of RegTech, reach out for help. You can hit the ground running and ease what’s become an enormous compliance burden sooner than you think. Email me at and I’d be happy to start a conversation about how.

From Wendy Rudd, Board Member, Canadian RegTech Association:
At the Canadian Regulatory Technology Association (CRTA), we’ve seen the opportunities that RegTech offers, and the associated implementation challenges that firms face. Indeed, as Accenture observes, many are asking for help; they want and need to equip their compliance teams with modern and insightful tools – not only to sustainably deliver their responsibilities, but also to give clients the kind of experience they want and deserve.
While other countries have mobilized to support the advancement of RegTech, Canada’s potential is relatively untapped by comparison.
The CRTA is a non-profit organization focused on solving the regulatory challenges unique to Canada through collaborative efforts among key RegTech stakeholders: regulated entities, technology vendors, regulators, governments and professional service providers.
Our goal is to raise standards and promote growth and innovation – to create a thriving Canadian RegTech ecosystem. We’re doing this by:
• building awareness of the sector – in Canada and internationally – through events and collaboration with other RegTech centers
• facilitating dialogue and collaboration among industry, innovators and policy makers – to reduce regulatory uncertainty, identify opportunities and develop solutions
• creating the Canadian RegTech Directory – an independent tool for industry to use to connect with technology solution providers and innovators
• working with participants to test and validate concepts
RegTech does hold huge possibility! By working together, we can “lift all boats” and create a valuable export industry in an area where Canada has both the expertise and international standing. For more information, please visit
From Lori Weir, CEO of RegTech company Four Eyes Financial:
What’s exciting about today’s regulatory environment is that firms are embracing ecosystems to make the best use of data from the front, mid and back office to enable unified risk workflows. When data flows in this way, it is much easier to create automated controls, so problems are identified faster and resolved sooner.
For example, Four Eyes Financial’s Risk7 compliance platform is screening out 97% of the daily trade blotter transactions. What’s left is a compliance dashboard that focuses supervisors on what’s most important. As the Risk7 platform begins to learn how compliance supervisors deal with exceptions, we see this number increasing to 99%. Ultimately, ending up with automated compliance inquiries being triggered only when human judgement is required.
This platform means compliance teams can turn their attention from the rear-view mirror. With automated guardrails, as well as a better prediction of what’s ahead, they can feel safe driving forward, faster.

Special thanks to 
James Pashutinski, Accenture Analyst – Capital Markets, Wealth Management for contributing to this blog.