October 31, 2011 08:45 ET

SEI Compliance Poll: For Second Consecutive Year, CCOs Stifled by Increased Responsibilities and Lagging Resources

Most CCOs Say Senior Management's Commitment to Compliance Remains 'Very Strong'

OAKS, PA--(Marketwire - Oct 31, 2011) - According to results of a poll released today by SEI (NASDAQ: SEIC), for the second consecutive year chief compliance officers are taking on more and more responsibility while struggling to keep up with the pressure of ongoing regulatory changes. The poll was conducted recently at the company's 6th Annual CCO Forum, a conference hosted as part of SEI's ComplianceAdvantage Program. The event, which provides a diverse set of compliance resources to clients, including expert guidance on complex issues and timely regulatory topics, brings together investment manager CCOs to discuss key trends and topics and to share emerging best practices in the compliance arena.

The poll showed that the majority of CCOs (59 percent) felt the greatest impediment to their effectiveness was their ever-growing list of responsibilities. Yet another 28 percent said a lack of resources or funding was their greatest barrier to success. An area of additional responsibility often shifted to CCOs is enterprise risk management. CCOs at the conference were cautioned about the potential perils of taking on responsibility for enterprise risk management unless the CCO is adequately staffed and qualified to do so. The poll, which surveyed CCOs from organizations ranging from $500 million to $5 billion in assets under management, points to the ongoing struggle facing CCOs as they try to keep up with the changing regulatory environment in the face of shrinking or stagnant resources.

Despite their limited resources, the majority of CCOs say they have the backing of senior management. In fact, 80 percent of those polled said the commitment of senior management to compliance in the past year has been either "very strong" or "somewhat strong." More than half of all CCOs (59 percent) responded that their biggest challenge this year has been preparing for new or pending regulatory changes. Another 22 percent of those polled said their biggest challenge was keeping their firms focused on compliance despite the distractions of trying to survive and prosper in a down economy. Thirteen percent polled said dealing with SEC-related inquiries was their biggest challenge. A related and particularly troublesome topic discussed at the conference was the SEC's recent willingness to move deficiency matters into the enforcement stage more easily than ever before.

"The poll shows that CCOs continue to be asked to do more with less, and there doesn't appear to be much relief in sight," said Jim Volk, Chief Compliance Officer for SEI's Investment Manager Services division. "With ongoing SEC rulemaking activity, the regulatory environment is constantly changing, so most CCOs need help just to keep up. At SEI, we're doing everything we can to provide a level of consistency aimed at giving our clients the insights and tools they need to stay ahead of the changing compliance landscape and to put their businesses in the best position to succeed."

The use of social media is yet another reason for the increased compliance workload. An area of interest that garnered particular attention at this year's conference was the importance of modifying and communicating changes to existing policies and procedures to address the numerous issues associated with the use of social media. A quarter of those polled said their firms are currently using social media tools, and the vast majority of such firms have created or amended policies in connection with that use. In fact, 78 percent of respondents said they have written a separate set of policies and procedures in connection with social media use, amended current e-communications policies, or a combination of both.

Nearly all of the respondents (88 percent) said their firm has a written code of ethics that is regularly updated, enforced, and tested. However, only half of those polled (50 percent) said their code of ethics is part of their business continuity plan (BCP), while only slightly more than a third of respondents (35 percent) said their code of ethics is tested as part of their BCP.

Compliance-related training continues to be an area of focus as a large majority of those polled (73 percent) said it is offered regularly at their firms. On this topic, CCOs in attendance were encouraged to consider the value of various alternatives to instructor-lead compliance training.

About SEI's Investment Manager Services Division
SEI's Investment Manager Services division provides comprehensive operational outsourcing solutions to support investment managers globally across a range of registered and unregistered fund structures, diverse investment strategies and jurisdictions. With expertise covering traditional and alternative investment vehicles, the division applies customized operating services, industry-leading technologies, and practical business and regulatory insights to each client's business objectives. SEI's resources enable clients to meet the demands of the marketplace and sharpen business strategies by focusing on their core competencies. The division has been recently recognized by the Money Management Institute as "Service Provider of the Year" and by HFMWeek as "Best Single Manager Hedge Fund Administrator (Over $30B AUA - US)," and "Best Funds of Hedge Funds Administrator (Over $30B AUA - Europe)."
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About SEI
SEI (NASDAQ: SEIC) is a leading global provider of investment processing, fund processing, and investment management business outsourcing solutions that help corporations, financial institutions, financial advisors, and ultra-high-net-worth families create and manage wealth. As of September 30, 2011, through its subsidiaries and partnerships in which the company has a significant interest, SEI manages or administers $395 billion in mutual fund and pooled assets or separately managed assets, including $151 billion in assets under management and $244 billion in client assets under administration. For more information, visit