Smart technology can ease GDPR compliance, says Compendor founder

09 April 2018 Authored by Consultancy.uk

Two years ago Elmo Olieslagers left a large management consulting firm to launch Compendor; a startup that specialises in regulatory technology (RegTech) consultancy services and solutions. Consultancy.uk sat with Olieslagers to learn more about Compendor and where the firm currently stands, his entrepreneurial endeavours and his ambitions for the firm in the years to come.

The financial services industry continues to face a growing volume of regulatory change, as both international and domestic legislators craft rules to improve the functioning of the industry. One example, the General Data Protection Regulation (GDPR), which comes into force in May 2018, could see FTSE 100 companies stung by around £5 billion in fines per year. The regulation will protect EU residents from a range of potentially abusive, manipulative and unsafe uses of their data, which means that companies may be caught out unless they update their practices radically. 

Speaking to Consultancy.uk last year, Elmo Olieslagers, Managing Partner of Compendor, said that the emergence of new technologies in the regulatory space is offering financial services institutions growing possibilities to reduce costs and improve the quality of their regulatory response process. Now, as financial services providers brace themselves for the imminent GDPR, Olieslagers believes that smart technology has the potential to lighten the workload relating to GDPR compliance. 

Smart technology can ease GDPR compliance

Compendor

Compendor helps financial institutions understand the impact of regulations and stay in control of regulatory change programmes. The firm was established in response to a disconnect between technology and content, enabling clients to add direct value by integrating deep content to the technology they use.

The area Compendor focuses on primarily, RegTech, is touted to be the next major disruptor for the compliance field, particularly in highly regulated industries such as financial services and energy. Olieslagers said that the biggest impact that RegTech can make on the market is to streamline compliance efforts of an organisation. He commented that Compendor clients are coming under increasing pressure to decrease the costs of implementing regulatory changes and compliance monitoring, adding, “Winners in the financial services industry solve this dilemma by efficiently using technology combined with online support models integrated in their day-to-day operational activities. Regulatory technology has emerged to enable a more automated, cost-effective way of meeting compliance and regulatory reporting needs in time.”

In the case of Compendor, the consulting firm has a business rule driven, easy-to-use decision tree solution, allowing financial institutions to limit their efforts to those sections of the legislation that are relevant for specific business lines / legal entities and disregard the sections that do not apply. The flexibility of the solution is important, said Olieslagers, and aligns to the industry’s pragmatic approach. 

“The solution ensures a significant reduction in effort and costs related to interpretation activities across the various business lines and legal entities involved. For the true complexities (e.g. interdependencies with local regulation and internal policies) online support from our various experts can be provided. Optional, a tier 1 law firm partner can provide quality assurance on the legal foundation throughout the process,” said Compendor’s Managing Director, adding, “We have clients who use the solution ‘stand-alone’ by themselves to manage their implementation or clients who us for our additional consulting services.”

Olieslagers cited MiFIR, MiFID II, MAD II, MAR and PRIIPS as key examples of the main uses for such RegTech, but elaborated that there are various use cases in general that can be considered all to decrease costs / increase quality. 

Financial services players can benefit from RegTech solutions

When asked specifically about the increasing attention that the GDPR is receiving in worried boardrooms, Olieslagers stated that Compendor’s smart technology solutions could ease the preparation for post-GDPR launch life. The firm’s GDPR solution aims to enable organisations to determine which parts of the legislation is relevant and what priority should be given. He added, “Also the online help (back-ground info, best practices) helps organisations to better understand what the regulator wants and how other organisations deal with the requirements.”

Frankfurt and the future

Compendor is based in Germany’s financial heart, Frankfurt. The firm was built in the city for longevity, with Olieslagers suggesting the organisations founders are “afficionados” of Germany, but besides this, setting up shop was strategic too. The area is the financial hub of mainland Europe, making it an essential location in the future, as the EU financial ecosystem is likely to restructure following Brexit. 

Speaking on the attractiveness of Frankfurt, Olieslagers said, “For a consulting firm there is huge business potential given its vast client base. Brexit is making Frankfurt even more attractive. Following the UK’s June 2016 vote to leave the EU, leading banks from Japan, the US and elsewhere have announced plans to shift large numbers of staff from London to the city. For example, Goldman Sachs is expanding its presence and JPMorgan recently announced it would expand its presence with 200 workers. For a multi-language boutique firm like us, with pragmatic solutions on EU financial regulation, we have something unique to offer in Frankfurt.” 

Within two years of launching, the consultancy has seen meteoric growth, and has been named one of the globe’s top 100 RegTech companies. The firm began life with a launching client, for whom it ran a regulatory compliance programme for several regulations. Since then, “As a start-up we have been working on 3 important areas: 1) helping our clients 2) position our RegTech offering and 3) growing the team. Of course we run into the typical challenges you face on these three areas,” Olieslagers said, modestly. 

Compendor has managed to sign preferred supplier contracts with major banks, while the organisation’s team has grown in size to seven, and it has established a name as a leading provider of RegTech solutions. Building on this, Olieslagers said the firm’s key ambition was to keep up the good work in order to “sustain our position, and further strengthen our existing relationships first and foremost!”

Related: GDPR compliance to cost FTSE100 firms £15 million, banks face largest bill.

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