The last six or seven years provided us with a unique view on managing risk.
Advances in technology and data management provide professionals with a tool to make decisions based on information that seemed impossible to obtain a decade ago. The challenge for professionals and compliance officers today is ensuring that this information is not just feeding into a decision-making process, but influencing quality decisions.
Now that internal controls are commonplace for most companies, there is renewed emphasis on ensuring the quality of those controls. From data protection to conflicts of interest, to role clarity, there are elements of quality management that go beyond effective analysis of the data.
The spike in Appraisal Management Companies providing services in the U.S, was an example of how data management was a way to help lenders manage risk while also providing a layer of independence on the appraisal side of loan securitization. The subsequent contraction of AMCs in the last few years suggests that it’s not just the data that matters, but the quality of the processes surrounding the use of that data.
It’s not just risk managers and compliance geeks that are interested in how firms control for quality. It goes without saying that regulators, insurers, and clients are showing an increased interest in companies’ internal processes. This leads to the next logical question – with varying expectations of regulators and clients, and with the variable nature of the markets in which firms operate, is there a consistent way in which firms are expected to control quality?
One of the ways in which firms can successfully mitigate risk is by working with an independent quality controls specialist that can provide pro-active solutions and apply industry best practice to any issues that may arise. Large global firms are starting to see the financial benefits that come with effectively regulating their business, whether through RICS or others, and have been able to witness the effects.
Staying on top of changing regulations for clients demonstrates a commitment to leading the industry through quality, integrity and transparency. That is why in 2012 we rolled out the opportunity for firms to become RICS-Regulated as evidence of working to the highest professional and ethical standards available, and able to provide the best quality service to clients.
The way in which a firm manages its risk can move the discussion of quality controls in the right direction. Having a quality control process in place, along with a mechanism to assess the effectiveness of those controls, is something that firms can do in a way that is fit for their business no matter the size of the firm or where they’re operating.
Ultimately, effective quality controls are agile enough to keep-up with the changing demands of the market. If companies have learned anything over these last seven years, it’s how to be agile.
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