Sound policies and procedures: the basis of a sound compliance program

Abstract

Purpose

The purpose of this paper is to: emphasize the importance of sound policies and procedures to support a sound compliance program; define the relationships among rules, policies, and procedures; and recommend a detailed, step‐by‐step approach for implementing a strong rules, policies, and procedures infrastructure.

Design/methodology/approach

The paper discusses the nature of rules, policies, and procedures and how they relate to one another, and recommends an approach to implementing a strong rules, policies, and procedures infrastructure broken down into four phases: discovery, rationalization, implementation, and ongoing maintenance.

Findings

The study finds that financial services organizations need to take steps for creating, controlling and distributing the right policies and procedures to the right audience based on the right interpretation of laws, regulations and guidance à propos to their businesses. In large complex firms today, the ongoing maintenance of rules, policies, and procedures cannot exist without the assistance of an automated solution.

Originality/value

The paper provides practical advice from experienced systems consultants.

Citation

Wolosz, L. (2007), "Sound policies and procedures: the basis of a sound compliance program", Journal of Investment Compliance, Vol. 8 No. 4, pp. 7-11. https://doi.org/10.1108/15285810710839471