IAA Compliance Survey Finds BCPs Effective Amid Pandemic

The Investment Adviser Association conducted its annual compliance survey of investment advisers and received responses from 384 firms. The survey found that the hottest compliance topics in 2020 were business continuity plans and cybersecurity, with the pandemic taking up a significant portion of compliance departments’ attention. The survey results reflected well on firms’ business continuity planning amid the current crisis: 69% of respondents said their BCPs included pandemics before January 2020;  93% of respondents whose business continuity plans had included pandemics said their BCPs operated effectively; 96% of respondents who said their BCPs did not include pandemics still found their BCPs to operate effectively; and 68% of respondents plan to update their BCPs to include pandemics. With respect to cybersecurity,  94 percent of firms surveyed had a formal cybersecurity program and  77 percent had cybersecurity insurance. For the overall compliance function, the survey found  a substantial number of CCOs (40%) wore only one hat, however about 25 percent were employed as general or legal counsel along with their CCO role. About 40 percent of the CCOs surveyed wore two or more hats and performed non-CCO/legal roles.