Compliance has always been crucial for financial advisors. Firms that don’t prioritize compliance risk costly audits, penalties, and punishments that can stall their growth and impact their reputation and client experience.
However, the world of compliance is changing, and advisors can’t just take the same approach as they always have and expect a smooth compliance experience. The future of compliance is in integrated data. Leaning into technology to integrate data for compliance reporting streamlines processes, builds trust, and sets advisors up for long-term success.
Complex Compliance Requirements
As regulations change and technology evolves, compliance is becoming more complex. In addition to evolving SEC and FINRA regulations, firms must also stay compliant with data privacy acts and other regulations. Now more than ever, advisors and firms need to make compliance an ongoing process, not just a one-time project. A culture of compliance has never been more important, and that comes through in everything from a firm’s mindset to the tools it uses to store and manage data.
Most advisors have moved past paper filing systems to digital documentation. However, even basic digital systems are no longer effective. Manual data storage simply isn’t an option for today’s advisors. One mistake can have ripple effects and lead to major compliance issues. That means that even if one piece of data is entered incorrectly, it can throw everything out of compliance and create major issues. The solution to these complex problems is an integrated digital solution to store, connect, and protect data. With integrated data, information is seamlessly moved between systems, readily available, protected, and organized.
Data Integration Streamlines Compliance
The best way to stay compliant in an increasingly complex process is through integrated data. Data is the foundation of compliance, so firms that can leverage integrated data aggregation from the beginning set themselves up for easier compliance processes down the road and more accurate reporting.
Disparate data sources create confusion and open opportunities to make errors, especially as data is transferred manually between systems. When advisors have different data in disconnected systems, such as a client’s income or date of birth as one entry in one system and a different entry in a different system, they may be operating off incorrect or outdated information, which can affect the quality of service and cause a lack of compliance.
The solution to this is integrated data aggregation. Instead of searching for data across systems, having to manually move information, or being unsure it is correct, integrated data keeps everything connected and in one place. If a field is updated or changed, that information is automatically reflected in all other systems. For example, when an advisor contacts a client and makes a note about their conversation in the CRM, that data is automatically synced to other systems and stored, easily ensuring the advisor maintains a record of that conversation to stay in compliance.
Integrated data allows advisors to trust their information and provide personalized service to clients without questioning data accuracy or manually staying compliant. That peace of mind leads to financial security for clients and smoother operations for advisors and firms.
Digital integrated data storage also keeps records of the appropriate information so it can be easily found for compliance reporting. Instead of spending days or weeks sorting through documents for an audit, advisors with digital integrated data systems can easily find the records and information they need to prove their compliance.
In the complex world of compliance, integrated data isn’t something that’s nice to have — it’s a necessity for modern financial advisors.
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