How well is your risk monitoring managed? Well. According to a recent survey we conducted at katchr, the answer is probably not as well as you would like.
In a recent survey that we carried out, only 20% of respondents reported that they thought their risk monitoring was “well managed and efficient”.
Why does this matter?
Law firms operate in a highly regulated environment. In recent years many would argue that the regulation has become even tighter, whilst at the same time being less well defined due to the outcomes focussed regime.
At the same time as pressures on those responsible for risk management has increased, the number and diversity of risks facing firms has also grown. When asked about the number one issue faced in risk and compliance monitoring, our respondents reported numerous different primary concerns, including:
- cyber crime
- changing regulatory environment
- resourcing the process
- co-operation from partners
What can be done?
Those responsible for monitoring risk and compliance in law firms need as much help as possible in order to meet the challenges they currently face. At katchr our mission is to help law firms to continuously increase the value they gain from their data. One conclusion we have come to in recent months is that the vast majority of firms do not maximise the value of their data for compliance.
Virtually every firm captures significant volumes of data about potential risks just through the day to day processing of matters in the practice management system. This data, when combined with the “business rules” that the firm has determined for managing its processes, can be used to automatically identify risk and alert the appropriate people.
Typical risks that firms can easily identify include:
- Client identity checks not completed
- Client undertakings not discharged
- Conflict of interest checks not completed, or inadequate
- Client care letter / terms of business not agreed
- File reviews not completed
- Complaints not being processed
We find that the underlying data to identify these risks is either already, or easily can be captured within most firms’ systems. However what is not being done is consistent, regular monitoring of that data. Typically some junior person is charged with running endless reports once a week or once a month, to be emailed around the firm and buried in already overcrowded inboxes.
What’s the answer?
At katchr we provide risk and compliance monitoring dashboards, that enable all those with risk management responsibilities (Managing Partner, COLP, COFA, Compliance Officer) to monitor potential risks across the firm from a single, simple screen.
We also help firms to delegate responsibility for risk, by distributing this information to those with direct control over the issues – team leaders and the fee earners themselves.
What impact would it have on your firm’s risk management process for everyone in the firm to have instant access to this information on a daily basis, with no need for anyone to waste time running and distributing endless reports?
Possibly more interestingly, what impact would it have on your Professional Indemnity Insurance premium negotiating position to be able to demonstrate a fully automated compliance monitoring system operating right across your firm? Our experience from both client and PII broker feedback is that this in itself can more than justify an investment in better systems.
If you want to learn more about the katchr Risk and Compliance Alerts module, please get in touch.