Getting the balance right with technology is like walking a tightrope. Weighing the benefits with the cost and implementation impacts often makes for unsteady ground that can go either way. But now, more than ever, compliance teams need to mitigate the impact of COVID-19 with tools that drive efficiency and accelerate recovery.
When it comes to due diligence technology, establishing the right approach will help you manage growing compliance needs. Here we take a look at some of the tools available to deepen your research and how to use them to achieve maximum benefit for businesses.
Three Important Due Diligence Technology Innovations
Regulators have been encouraging innovation in compliance for some years now but growing FCPA risks as a result of the COVID-19 pandemic have made this even more vital. Compliance teams have to do more with smaller budgets while facing an environment where data is more complex and changing at an incredible speed. Here are three important tools that can provide compliance teams with more in-depth information and reduce some of the heavy lifting when it comes to data gathering.
Automation
Manual data gathering is slow and costly. Reliant on researchers’ skills, a poor manual approach is prone to error and inconsistencies. Streamlining the complex process of gathering and analyzing data with automation tools provides efficiencies for research gathering. Analyst time is freed up and can be used instead to focus on the more detailed investigative tasks. An example of automation in action can be seen in the perpetual screening of third parties to manage the growing risk of sanctions.
Link Analysis
This piece of technology has an important role in every compliance officer’s toolkit. It has the ability to analyze large quantities of data by trawling through datasets and then establishing connections via a graphical representation. Link analysis is particularly important when it comes to beneficial ownership as a way to visualize complex ownership structures.
Artificial Intelligence and NLP
Much has been said about the power of artificial intelligence (AI) to work through piles of documents and do much of the tick-box work when it comes to compliance. For example, researching the ever-growing volumes of media reports is a clear benefit of AI. But the false-positive rate when it comes to AI-based media searches can be high, staggeringly so, at up to 95 percent.
Natural language processing (NLP) fares better by systematically analyzing unstructured text to focus on only relevant risk, digesting huge volumes of data that may have been missed in the past. Both of these tools will play an important role in compliance once their major hurdles are cleared.
Maximizing the Benefits of Technology
In order to achieve the maximum benefits from technology, it’s important to understand their limitations. Many AI due diligence solutions offer a one-size-fits-all approach or are limited to English-language research only. Other types of emerging technology, such as blockchain, have not yet become reliable solutions to compliance issues.
At IntegrityRisk we use technology in all of our due diligence work but we know that the true benefits are only realized when we combine it with the power of human intelligence. Technology plays a significant role in data gathering but it is the human analysis that provides the answers our clients need. By piecing together a web of raw findings, removing false positives and reviewing non-English language findings, we are able to pull together a complete picture to drive insightful decisions.
Our research process can be defined as a technology in itself, the ‘science of craft’. The skills and methods we use to conduct research are responsive and based on the changing environment of technology, databases and availability of sources. We apply best practices and accumulated knowledge of sophisticated research techniques to produce technology-driven due diligence that informs strategic choices.
Contact us today to enhance your due diligence process with technology in the hands of experts.