The saying “Trust is good, but control is better” is ever more pertinent as the digital frontier expands at an unprecedented rate, especially for financial institutions in developing countries. Yet, in the pursuit of compliance, we often overlook a critical point: compliance is more than just a regulatory requirement; it is a strategic asset that fosters innovation, trust, and growth.

This article will briefly highlight strategies for strengthening your organisation’s security, touch on how compliance is a strategic enabler and provide a call to action for business executives.

Strategies for strengthening Information Security

Information security strategies for financial institutions should go beyond technological solutions to include organisational and cultural changes. Firstly, integrating security measures at the early stages of product and service development contributes to reducing vulnerabilities by adopting a ‘security by design’ approach. Furthermore, encryption, multi-factor authentication, and blockchain technology can significantly enhance the security of sensitive data.

Despite this, technology alone cannot solve every problem. Human error remains a significant contributor to data breaches. In light of this, cultivating a culture of security awareness through regular training and simulations is crucial. Educate all employees about cyber threats and their role in safeguarding the institution’s data.

Additionally, financial institutions should adopt a proactive stance toward information security by implementing continuous monitoring and real-time threat detection systems. By employing this approach, not only are potential threats detected early, but they can also be mitigated swiftly.

Compliance as a strategic enabler

The narrative around compliance needs a paradigm shift. Compliance, often viewed as a cost centre or a necessary evil, should instead be seen as a strategic enabler that can open doors to new markets, enhance customer trust, and drive innovation.

For financial institutions in developing countries, aligning compliance with strategic objectives can be a game-changer. It is not merely about adhering to regulations but about leveraging compliance to build a secure, resilient, and trustworthy digital ecosystem. This approach mitigates risks and enhances competitive advantage, enabling institutions to navigate the digital landscape with confidence and agility.

A call to action for C-Suite leaders and business executives

A mindset shift at the top is the first step towards leveraging compliance and information security as strategic assets. Financial institutions in developing nations must have business executives and C-suite leaders who are committed to:

1 Embrace compliance and information security as integral to their strategic vision, not as afterthoughts or mere operational necessities.

2 Invest in building robust, adaptable information security frameworks that can evolve with the digital landscape and regulatory requirements.

3 Foster a continuous learning and innovation culture, where compliance is seen as a pathway to excellence and competitive advantage.

In the words of Warren Buffet, “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.” Let this be a clarion call to action. Develop a culture of vigilance, invest in robust information security measures, and lead your organisation with foresight and resilience. You are responsible for your customers, your employees, and the fabric of your reputation.

• About Derek Smith Jr

Derek Smith Jr. has been a governance, risk, and compliance professional for more than 20 years with leadership, innovation, and mentorship record. He is the author of ‘The Compliance Blueprint’. Mr Smith is a Certified Anti-Money Laundering Specialist (CAMS) and the Assistant Vice President, Compliance and MLRO for CG Atlantic’s family of companies (member of Coralisle Group Ltd.) for The Bahamas, St Vincent & The Grenadines, St Lucia and Curaçao.