According to Wikipedia, “in science, computing, and engineering, a black box is a system which can be viewed in terms of its inputs and outputs, without any knowledge of its internal workings. Its implementation is "opaque" (black) .The opposite of a black box is a system where the inner components or logic are available for inspection, which is most commonly referred to as a white box (sometimes also known as a "clear box" or a "glass box")”.
If we bring the concept to the context of risk and compliance management, it is an excellent metaphor for inefficient, sometimes poorly executed, programmes that are:
Do any of these ring a bell? If so, it might be time to reevaluate some of your compliance processes so that it can become a “white box” instead. In our interactions with financial services institutions and other heavily regulated organisations, oftentimes the weak link is on manual, inefficient compliance document management processes. Investing in a fit-for-purpose platform sometimes gets relegated as a “nice-to-have” or a “I’ll do it next year” but in truth, firms that are still relying on spreadsheets, email chains and generic tools are exposed to greater compliance risks by operating in a “black box” model.
Here are 9 questions that you can ask yourself to understand whether this is the case in your company:
If you answered “yes” to these questions, you can rest assured your compliance documents are being managed in a “white box” manner and you’re minimising your company’s exposure to the risks of non-compliance. However, if your answer was “no” to some - or most - of these questions, then I’d recommend you check these free resources that could help you understand whether it’s time for you to invest in a modern policy and procedure management platform:
Are you ready to take the plunge and strengthen your compliance programme or are you ok with operating as a “black box” and taking a chance with the Board and regulators?