"Right timing" & "Co-operative Compliance"

When I started in my current role I proposed two terms or concepts to my Programme Steering Committee. I now seem to use them with increasing frequency across a wider range of change so I thought it worth capturing and sharing them here.

I will caveat this piece at the start that these have been applied to the tsunami (or is a morass?) of regulatory change hitting the world of financial services, but probably apply as well to any situation where the drivers (and rules) relating to the change emerge as a slow reveal over an extended period.

The terms were:-

• Right Timing; and
• Cooperative Compliance

Right Timing relates to judging the right time to move into action. This is often a fine line, between not starting too late and having enough confidence in what is needed. Start too early and you could easily waste scarce resource doing work that is not needed or has to be redone, start too late and you miss the market.

This is currently very relevant to the world of regulation where there is a huge amount going on without the commensurate clarity or certainty. While high level intent is (relatively) easy to set, the devil is often in the proverbial detail, especially if there are many agencies involved in drafting the final (local?) rules. This usually leads to distraction and delay.

A prime example is FATCA, where the US is rather strong-arming a global change around reporting on the assets of US taxpayers. Initially the IRS set out a draconian vision that would require lots of non-US banks to start collecting taxes on behalf of the US. A number of organisations recognised the scale of what was being asked and started substantial pieces of work and system builds to be ready. Since then new agreements are emerging that can remove that obligation and dates have slipped. I know of companies have written off substantial investments, arguably because they moved too early.

This is not what could be seen as analysis paralysis, but rather informed judgement. Of course hindsight is a perfect judge and sometimes you will get it wrong, but I think the example illustrates the point.

We are now facing similar timing challenges in EMIR and AIFMD. As a result managing stakeholder expectations and having open governance an effective decision making is more critical than ever.

Co-operative Compliance is the attitude of constructively and intelligently working with the changes in the world/regulation and in doing so give your stakeholders confidence that you are safe to do business with. This is not about blind adherence or insane haste to respond to any requirement. Also it does not mean that you can never challenge or interpret. What it does mean is that you don't allow anyone to perceive you like the bolshy toddler who has planted his feet, pouted his lips, crossed his arms and then attempts to stare you out. That is helpful to no-one.

I guess a bit like finding the right time, cooperative compliance is about finding the right response.



These two terms have been very useful as a way of breaking certain deadlocks and are almost always greeted with a nodding of heads and a few wry smiles. So far no one has kncked them back.

To make use of them in your work,

• make this part of your change culture, ensure that you use and explain the phrases often so that people remember them,
• find people with a mental agility and who are equipped to judge what is right for the business, but are brave enough to not follow the herd when that is appropriate
• don't be afraid to change course and bring others along with you if the world around you moves
• find the personal strength to hold on to what you believe is right and proper and let time be your judge, 

Good luck!