How is heavy-handed compliance compatible with the development of simple products?
I am getting very exercised about the big opportunity we have in developing simple products. We have a very capable set of people working within the industry to this end. I have had an encouraging discussion with Carol Sergeant – the former Financial Services Authority director who is heading up a Treasury steering group on the issue – about it and, optimist that I am, I really do think something really good could happen. I see the spread of social media, the possibilities for using it to provide information and I sense a quiet determination within the industry to make something happen.
But then I think of the hordes of compliance people to whom an idea like this would be anathema. One of the big changes, especially in really large organisations, has been the inexorable rise of the business preventers, the pourers of cold water on ways to get products easily to people and to harness new ideas and new propositions to bring bright, informal ideas to the insurance-buying public. In an era where we talk wildly about innovation the reality is that for many organisations it is much more important to be compliant than innovative.
I find it ironic that in downsizing organisations we never think about downsizing compliance departments. In fact, I’ve never seen it happen. We have developed a culture, which spread initially from the US, that has thrown a straitjacket over organisations. It is more important not to be sued than to do anything constructive that might make it easier to provide new concepts to customers.
How often nowadays, when organising a meeting or a conference, do I wait for clearance on slide packs from compliance departments. The people I normally ask to speak are top-quality professionals who know the business inside out and they really don’t need the say-so of lawyers and an array of internal approval mechanisms before they share their thoughts with colleagues in the industry. Some of the disclaimers I have seen on these slide packs are frankly bizarre, completely unworkable and utterly pointless. But great organisations have to tie themselves in knots while a jobsworth tells them what they can say in public.
I’ve been in the industry for many years and I can never recall an occasion when something unsuitable was propagated by public utterance. Yet for some reason the thought-police must check everything before we say and debate it.
Pray tell me how this is compatible with simplicity, with thinking differently and freely about offering the public cover more easily. I doubt if you can simply because it isn’t. Please, for the love of all that is worthwhile about this industry, ease the burden of compliance on this new undertaking— we need light touch compliance (if I haven’t invented a new oxymoron!).