Internal Compliance Vs. External Compliance

The financial sector, more than other industries, is under great scrutiny by local and federal governments' legislative and regulatory agencies. Some of these regulations are internal; some are external. An Internal Compliance program describes the internal control measures required for monitoring compliance within an organization. It serves as an in-house guide detailing internal protocols and procedures put in place to deal with risks. For internal regulations banking supervisors must be satisfied that effective compliance policies and procedures are strictly followed. External Compliance refers to laws, rules and standards set by legislators, central banks, governmental bodies, market conventions, and codes of practice ethics developed by industry associations.

Before going deeper into Microsoft for Solutions for the financial services within the compliance context, we need to define a few things:

What are Microsoft Office 365 Services?

Microsoft definition of Office 365, as such, "Microsoft Office 365 is a cloud-based service that is designed to help meet your organization's needs for robust security, reliability, and user productivity." The best part is that it runs in the cloud and is continuously monitored by Microsoft engineers for safety, reliability, and security.

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 “UBS is a leading the industry in public cloud adoption by using Microsoft Azure for global scale, security, to improve business agility, reduce costs and gain a competitive edge.” UBS is one of many global giants that decided to migrate their data and services to Microsoft Cloud.

Microsoft press release- April 26, 2017.

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As Microsoft Press Release back in 2017, Office 365 services have earned respect and trust of major banking groups globally. For example, Swiss banking giants UBS Group is moving their confidential banking data to Microsoft data centers. "Tremendous transformation is taking place in the financial services industry, and technology is increasingly providing a competitive advantage to firms," said Judson Althoff, executive vice president, Worldwide Commercial Business, Microsoft Corp. "UBS is a model of digital transformation in the financial services industry.” With Microsoft Azure, the firm receives all the advanced technological and economic benefits of cloud technology. The rush to the cloud by significant banking institutions is underscored by Microsoft's investments in security, transparency and regulatory compliance. As such, UBS can innovate while doing business all over the globe.

So, what does Office 365 include?

The business packages come with productivity software such as Office with all its essential components, collaboration packages as in SharePoint and Team. Office Online has all your favourite office software such as Word, PowerPoint and Excel with additional powerful features.  Advanced packages include storage packages such as Exchange and OneDrive. These packages, as mentioned afore, allow for more effective collaboration between and within teams wherever they are located. Everything happens in the cloud from document exchanges, interactions and more. SharePoint works in tandem with other included apps in the Office 365 suite.

Microsoft Cloud Financial Services Compliance Program (FSCP)

According to the Microsoft Cloud Financial Services Compliance Program, "The Microsoft Cloud Financial Services Compliance Program (FSCP) was specifically created to help financial services and regulated financial affiliates assess the risks of using Microsoft's cloud services. The FSCP offers deep insights into Microsoft cloud services' capabilities, risks, and performance. The FSCP is available to customers using Microsoft Office 365, Microsoft Azure, Microsoft Dynamics 365, and Microsoft Intune."

Difference between Compliance and Operational Risk?

Both Compliance and Operational Risk are considered as Non-financial risks. The Basil Compliance Accord document states that "there is a close relationship between compliance risk and certain aspects of operational risk." It also says that "' compliance risk' is defined as the risk of legal or regulatory sanctions, material financial loss, or loss to reputation a bank may suffer as a result of its failure to comply with laws, regulations, rules, related self-regulatory organization standards, and codes of conduct applicable to its banking activities (together, "compliance laws, rules and standards").

Types of Compliance Requirement

Cloud computing is a beneficial tool, but it does pose some risk. Regulators and professional associations are keen on evaluating these risks while developing majors to help mitigate potential risks. Adapting a strong risk governance and management practices in today’s digital business environment are imperative in a world where cloud computing and its usage is becoming very commonplace. Regulators focus on a few essential areas when evaluating compliance policy:

General Banking and Insurance regulations

In terms of general banking and insurance, there are regulations that software like Office 365 would need to meet compliance for. Examples would include MiFID II, Solvency II, and Anti Money Laundry.

Impact on Cloud Deployment:

These days, it's common to have transaction recording and recordkeeping requirements. With these, one may run into challenges about cloud deployments such as voice recording requirements. You'll even find requirements related to logging and specific data retention within these regulations.

Broker-dealer specific regulations

The term broker-dealer is used in U.S. securities regulation parlance to describe stock brokerages because most of them act as both agents and principals. A brokerage acts as a broker (or agent) when it executes orders on behalf of its clients, whereas it acts as a dealer, or principal when it trades for its account." The Security and Exchange Commission (SEC) is the regulating body for broker-dealers in the United States. SEC 17a-4 is one example of broker-dealer regulations. It pertains to records kept by brokers and dealers and the period they're required to be maintained.

Impact on Cloud Deployment:  For these, expensive logging and brokerage surveillance processes are required to be implemented within the service

Cloud and Outsourcing regulations

There are certain regulations that are important to know about cloud and outsourcing regulations in both the US and the UK/EU. For example, one must be careful to adhere to FFIEC guidelines in the US and the EBA and PRA guidelines in the EU/UK. 

Impact on Cloud Deployment: All financial supervisors see cloud computing as a form of outsourcing. These regulations are a primary focus when moving applications into the public cloud, and a broad range of risks are addressed in these regulations. Many of them appear as soft law (guidelines) or exist on a country-by-country basis, which may make the assessment process more complicated for multinational FI's.  

Benefits of Using SharePoint, Office 365 for Streamlining Compliance Policies

Compliance

When it comes to compliance, Office 365 has financial institutions covered. Compliance Manager assists IT managers to come up with custom risk assessments for applications that their financial institutions use. With Office 365 Advanced Message Encryption, admins can have their encrypted emails expired and revoked. High-risk content like phishing emails and confidential data that is leaked can be worked on and taken care of to minimize risks to the institution.

Collaboration

Thanks to Office 365, now users can collaborate with your teams and connect to resources all in the same place. Such capabilities allow users to stay in touch with customers, teams, and stakeholders.

Productivity

Office 365 is for the modern IT admin. You're productive wherever you go. You're never out of reach from Office 265 whether it's mobile, your desktop or any other device. It allows for ease of collaboration thanks to Microsoft SharePoint Online as well. Indeed, cloud users gain productivity is boost thanks to additional features in Word and PowerPoint as well. All software can are available on the go with along with your documents safe and secure in the cloud. Team members can access presentations and reports on the fly from any device and work anywhere with teams across the globe.

Customer Service

Technical service is available to IT admins round the clock, so whenever there's a critical issue, help is just a phone call away. Office 365 is always by your side for quick response to all problems. IT admins don't need to worry as they can get live help right away on the phone.

Mobility

Office 365 offers financial institutions IT teams’ complete mobility. They can work 24/7/365 from any mobile device and have access to the cloud. Since everything is in the cloud, all data is seamlessly accessible from all supported mobile devices. It's convenient and flexible and saves time. No work or data or task is out of reach and IT admins can efficiently work on their mobile devices, especially in times of urgency.

Cost-Effectiveness

Office 365 Business comes in three different flavours: Business, Business Premium and Business Essentials all reasonably priced. Thanks to the low cost of Office 365, you can always be productive without spending too much. It's a suite of software and services is more than worth its reasonable price. You get the backing of one of the world's largest software giants Microsoft and time-tested software at your fingertips. It doesn't get any better than this.

Security

Security threats are a reality when it comes to financial institutions. Data security is essential, and Office 365 provides all the safeguards that financial institutions require and adhere to regulations as well. In general, all prominent cloud providers, Microsoft Azure, Amazon AWS and Google Drive, offer a host of security compliance and governance features. As well major cloud providers support security standards and compliance certifications including PCI-DSS, HIPAA/HITECH, FedRAMP, GDPR, FIPS 140-2, and NIST 800-171.

Conclusion

In collaboration with Microsoft and our implementation partners, we do our best to make sure that our products used in the financial services follow compliance rules and regulations. There is a strong defence and safeguard against any security threats offered by the leading organization in the offering cloud service. Furthermore, we make sure we deliver the best customer service to end clients and businesses. Additionally, cloud users benefit from cost optimization, productivity and mobility provided by our partners. Office 365 is there to make sure the IT departments within financial institutions stay stress-free. Everything from hardware configuration, software installation, ongoing support, maintenance, administration, to capacity planning is streamlined to make their lives easier.  Office 365 is designed to do all the hard work for your IT gurus so that they can handle all the above tasks a lot easier. They can make sure your data is secure, protected, and backed up, and the servers are consistently maintained. It's cost-effective too, so there's more bang for your buck. Overall, Office 365 offers a complete all-in-one solution for financial institutions' IT requirements and that also help them follow regulations.

Here at Infowise Solutions, our client list includes some of the world’s best-known financial institutions.  Our products that are used by the financial sector are a cross-section of what we offer; Workflow automation, process automation, advanced dynamic forms and document filing. We have helped thousands of businesses across the globe in leveraging the power of their Office 365 platform to its fullest potential to quickly build a wide variety of modern business solutions, tailor-made to meet their business requirements. Through our implementation partners, we have been part of the digitization process for many businesses in the financial sector. Please visit our partner's page and research which partner is best suited to deliver the service you require.

Infowise

infowise is a leading provider of forms and processes solutions for the Microsoft SharePoint platform. Financial services providers make a large section of our client's list. As authors of productivity and agility software, we're pleased, yet not surprised that these global financial businesses have adopted our tools in their daily productivity cycles. Our flagship package Infowise Ultimate Forms is an integrated suite of SharePoint components that enables users to create advanced, dynamic forms, sophisticated business processes and striking visualization.
UltimateForms supports all Microsoft SharePoint platforms, including Office 365 and all on-premises SharePoint versions.