Malaysia sees the need for good compliance practice

Similarly, RHB Research Institute said it expected the central bank to maintain the OPR at 3.25% as this would maintain the stability of the ringgit versus the US dollar against the backdrop of ongoing monetary tightening by the US Federal Reserve and the greenback

KUALA LUMPUR: Local industries and governance regulators, in particular Bank Negara, have the desire and also see the need for good compliance practice, says the International Compliance Association (ICA).

Regional director (Asia Pacific) Andrew Glover said this was clearly seen in the steps taken by Bank Negara over the last few years to search for global best practices and bringing them to Malaysia.

“Bank Negara, in my opinion, has been very wise. It has gone a step further to also look at innovation and bringing in processes that exceed the way it (compliance) was carried out in other jurisdictions.

“The central bank was also seen as an innovator and leader by looking into areas such as senior management responsibilities issues, and it is currently in discussions with stakeholders to map individual responsibility in relation to matters on compliance,” he told Bernama.

On Feb 23, Bank Negara published a discussion paper on responsibility mapping to obtain feedback on a proposal to introduce a framework intended to increase accountability of senior members of financial institutions to promote a sound corporate culture.

Glover said there were very few countries which progressed in responsibility mapping and Malaysia was certainly blazing a trail with the consultation.

He said Bank Negara's idea to make it a requirement for compliance officers to possess appropriate qualification, was leading the field as many countries shied away from making this requirement mandatory.

“It is no surprise to anyone who wants to practice accountancy that they need to have (the relevant) qualification and be a member of a professional body.

“Here, we have people who are responsible for billions of dollars of corporate money and sitting at the top of the compliance tree and yet, there is no evidence to suggest that they are demonstrably competent for the job,” he said, adding, the Bank Negara guidelines was a recognition of a measure that needed to be imposed.

Glover said the willingness of Malaysia as a country in wanting to see good governance and compliance could be seen with the results of the recent 14th General Election, where the people clearly voiced what they want and expect from a government.

“It basically validates our decision to open up an office here in Malaysia,” he said.

ICA is a global not-for-profit professional body that awards certifications and qualifications in anti-money laundering, governance, risk and compliance, as well as financial crime prevention.

Its new Malaysian office will provide qualifications and training in the field of anti-money laundering and combatting financial terrorism.

Glover said the objective of ICA was to create a sense of community where people would be able to share and adopt best practices. 

“To date, over 130,000 people globally have studied for ICA qualifications on quality assurance which is awarded in association with the United Kingdom's University of Manchester,” he said.

In Malaysia, Glover said ICA had partnered the Asian Institute Chartered bankers and the Malaysian Insurance Institute to conduct and customise the training according to local requirements.

“We sensed that the qualification will be well received in Malaysia. This can be seen from the increasing number of people with this qualification two years ago, which doubled in 2017 and is expected to double again this year,” he said.

Glover said this was in line with the Bank Negara target for 50% of the workforce in compliance to have an appropriate qualification by 2020, and increasing to 100% by 2022.

He said the ICA was established to change the perception of the public to view compliance as a professional role similar to accountancy or law, and required formal qualifications, as well as occupational and competency standards.

“Although the largest in terms of take up (for compliance) are the financial services sectors and banking, in reality, compliance cuts across many industries as good governance is not restricted to any one sector, but very much at the heart of all industries,” Glover added. - Bernama



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