definition

Compliance means that the business activities of commercial banks conform to laws, rules and standards. Compliance risk refers to the risk that a bank may suffer legal sanctions or regulatory penalties, major financial losses or reputation losses due to its failure to comply with laws, regulations, regulatory requirements, rules, relevant standards formulated by self-regulatory organizations and codes of conduct applicable to its own business activities.

Compliance risk originally came from the financial industry, mainly aimed at banking institutions. However, with the deepening of the concept of compliance, the concept of compliance risk has extended from banks to internal control risks at the level of non-bank companies.

Therefore, in a broad sense, compliance risk refers to the risk caused by failure to be consistent with laws, regulations, policies, best practices or service level agreements in the company's internal control and governance processes.

Compliance risks mainly include:

1. Investment compliance risk.

2. Sales compliance risk.

3. Information disclosure compliance risk.

4. Anti-money laundering compliance risk.

Compliance management objectives are as follows:

1. Establish a perfect warehouse management system.

Enterprises should formulate a sound compliance management system, improve the internal compliance framework, clarify the framework of enterprise compliance protection, clarify the departments that perform compliance duties, and clarify all aspects such as management, audit monitoring, evaluation and assessment.

2. Improve the internal audit system.

Enterprises should establish an internal audit system in accordance with state regulations, strengthen internal audit control, improve the organizational structure and working mechanism of audit institutions, and ensure the effectiveness of audit work.

3. Improve the compliance education and training system.

Enterprises should establish a smooth compliance information transmission mechanism in accordance with the regulations, regularly update compliance requirements, carry out compliance education and training in combination with the characteristics of projects and posts, and improve the compliance awareness of enterprise employees.

4. Implement an effective compliance inspection system.

Enterprises should implement an effective compliance inspection system, constantly improve relevant inspection standards, regularly check the compliance control environment, management processes and service quality, and constantly strengthen the effectiveness of inspections.