Managing risk and regulatory change is an evolving challenge for financial services

Nikhil Asthana explain how we used regtech to identify opportunities for strengthening risk assessment and simplifying controls, paving the way for an investment bank's firm-wide roll out.

Assessing and managing risk is a core part of a firm’s activities. Financial services firms deploy significant resources to map risk and develop controls aligned to their strategic and commercial goals.

Pairing technology with human expertise can reduce the need for manual intervention and improve efficiency. An investment bank engaged us to build a solution that strengthened the risk assessment process, reduced the likelihood of manual errors, and allowed the risk function to deliver higher value work.

Identifying our client’s goals and overcoming challenges

A leading UK investment bank engaged us to deliver a technology solution to simplify risk management and support compliance. Our client wanted to use an AI-driven digital solution augmented by human intelligence to improve its risk management, as well as drive simplification of its controls by identifying, mapping, and optimising evolving control sets against firm-wide regulations, policies, standards and risks. In addition, the bank was keen to identify controls for automation that would offer return on investment.

We were asked to create a joint working relationship with a third-party regtech provider to build a proof of concept (POC) that could identify controls simplification opportunities for third-party vendor management, anti-bribery and corruption (ABC) processes with a view of highlighting potential gains. This also involved developing a roll out roadmap for the broader business.

We identified key challenges that drove our approach towards finding effective and efficient solutions:

  • Our client has over 4,000+ controls firm-wide, 90% of which are manual creating a complex risk assessment environment​.
  • There's a lack of clarity on regulations, policies, process, risk and controls mapping, obstructing the ability to create a simpler and more efficient risk and controls environment.
  • Manual control testing consumed 300+ full-time equivalent (FTE) per year and a new solution was needed to prove the potential of regtech to simply the firm’s controls environment.

This project also raised challenges, which we had to successfully navigate to deliver all phases of the solution on time. One of the key obstacles was access to the affected and relevant subject matter experts (SMEs) that work for our client. We needed to communicate with employees who had expertise in areas that affected risk management, including specialists in vendor management, bribery, corruption, risk appetite, and the client’s strategy.

As the existing method had been tried, tested, and employed for a long time, we had to work alongside SMEs to demonstrate that they could benefit from a different approach. We proved that the outcomes our solution produced were correct by comparing these results with the manual process. This also included providing training and education, allowing the relevant people to understand how their role would change with our solution.

We also worked closely with the third-party provider to manage this project and ensure the technology delivered the expected functionality and was completed on time. Our team employed a flexible approach to focus on delivering solutions, instead of just identifying problems.

Our solution

We developed a tool that took our client’s requirements and mapped out the risk management system and controls. This allowed the bank to identify where the risks are managed effectively, as well as where there are gaps or duplication. The solution allowed us to identify the opportunities for rationalising and automating certain practices.

Our solution allowed our client to simplify the risk environment and automate manual processes:

  • End-to-end mapping of regulatory rules, policy, risks to existing controls for ABC process and dashboard display in the tool​
  • A proposed set of key controls that address the material risks (including the resolution of control gaps) ​
  • Recommendations on control de-duplication, rationalisation, and automation to simplify risk management ​
  • Subject expert guidance and recommendations on the mapping of laws, regulations, and good practice to the client’s policies and procedures – advice on input into the software vendors platform
  • Created a high-level view of the ‘as-is’ state of the ABC management process to highlight potential gains
  • Consolidated POC controls simplification outputs leveraging AI diagnostics and human intelligence across the recommendations​

Against the controls reviewed, a proposed population of ‘key controls’ was identified reducing the key control inventory by 44.6%. Identification of a total of 12% of the controls that were found to be satisfactory and working well with no changes required.​ Recommendations on de-duplication, rationalisation, and automation were provided for 88% of the controls.


Leveraging AI diagnostics of the regtech solution, and providing human intelligence and oversight created trust in the outcomes among stakeholders. ​

Successful completion of the pilot outlined potential efficiencies and drew a future roadmap for risk management, control simplification, and automation in other parts of the bank.

How can you use technology to manage risk in financial services?

Each project must be reviewed on a case-by-case basis – there may not be a pre-packaged solution that works for every business as many variables can change how you best leverage technology. However, you can start by reviewing your processes and identifying the most resource-heavy practices.

Building a solution can be difficult and requires implementing the right frameworks alongside the technology. Firms need to access a range of expertise; professionals who understand regulatory and business problems, data and technical requirements, and others who can interpret that information and deliver a robust technological solution.

Our regulatory change approach supports firms seeking to use automation to manage compliance. You'll get a tailored solution that meets your needs and pushes you closer to strategic and commercial goals.

A technology-led approach to managing regulatory change

To learn more about building a bespoke solution to help reach your goals, get in touch with our team.

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