Knowledge First Financial hired the bad guy—or at least someone who could have been. Darrell Bartlett, chief compliance officer, first encountered the organization while working as a regulator for the Alberta Securities Commission, and if he had followed the stereotypical path of the antagonist regulator, he probably would have never found himself in the strategic role he inhabits now. Instead, he spent his time learning about the organization and how to better serve it—a tactic he continues to use today.
Knowledge First is registered as a scholarship plan dealer, but it does much more, offering peace-of-mind, tax-advantaged education-savings plans to its customers across the country. Here, Bartlett explains how he builds effective teams for the company so that he can go beyond compliance and help Knowledge First as it helps the future scholars of Canada.
The investment industry in Canada is high-regulated. So I have a mandate that’s set out in regulation as to what my responsibilities are—basically, developing a compliance system of policies, procedures, and oversight. I make sure that it’s operating effectively day-to-day. I also do a lot of risk-management work and planning, trying to anticipate what our risks are and making sure we have the right procedures, systems, and people in place to mitigate our risks effectively. As a member of the firm’s executive team, I also work on many strategic initiatives, as most everything we do in our industry has a compliance angle to it. To get involved as early as possible is good for a chief compliance officer—to know where the business is going and to be able to guide it correctly.
As a regulator, you can either take a very stern approach and demand something be done for a short-term result, or you can work with somebody in a positive and collaborative way and hopefully gain his or her trust and respect so that you can get a long-term result. It’s very difficult to do the job sometimes, as it can be challenging to learn enough about the firm you’re trying to regulate, down to the operational level. However, by taking that approach as a regulator and practicing it throughout my career, it helped me have success in my other roles and build effective teams as I preach and practice that same positive and collaborative approach with my staff.
Compliance, by its nature, can be pretty negative at times. You’re often dealing with problems and issues that require prompt and decisive action. However, it’s those opportunities where I can practice a positive and collaborative approach that are most memorable and rewarding. In one situation, I was working for a small securities dealer and we were trying to gain membership into the national self-regulatory organization (SRO) that would govern our activities. Gaining this membership was essential to our competitive positioning at the time. However, we had a business model that the SRO wasn’t familiar with and hadn’t had a history of accepting. So I worked with the SRO staff from my position as a former regulator and explained to them that despite the business model that we had, we would ensure that there was proper supervision and sufficient control over the relationships, and we would make sure that we could fulfill the regulator’s expectations. I took the time to understand what was important to them as a regulator and provided them with solutions.
Outside the Office
Darrell Bartlett believes in physical fitness and spends time with his wife and two teenage children, working out or playing hockey, golf, or football. The family is also a big supporter of the local YMCA, its facilities, and its programs, such as Strong Kids, and Bartlett’s wife even works there part-time.
When they saw that I was trying to work with them, the SRO accepted our firm into their organization. It was one of the first securities dealers in Canada to be accepted using that business model, and I’m proud to say that our acceptance laid the groundwork for other dealers operating under this same model. It was kind of a trendsetting decision. Once we were accepted, we also had to follow through and show the regulator that you are meeting their expectations through your actions. You can’t just talk; you’ve got to deliver and follow through.
In order for compliance to be successful in any organization, it has to start from the top. From the CEO to the executive team to the management and staff, it should be recognized that compliance is both essential and integral to the organization’s success. After that, you have to do a proper assessment of not only the quality of the program that you have but also identify if you have any gaps in the regulatory requirements. And you have to take a risk-based approach. You’ll never have the resources to do every single thing that you would want to do, so you’ve got to analyze both your regulatory risks and your business needs and figure out a plan to meet the objectives of both effectively. Then you’ve got to monitor and report; you have to know what your key risk indicators are and monitor them rigorously. Set benchmarks for them, and if you see any red flags, then that’s where you direct your attention. If something lands on my desk and it’s the first time I’m seeing it, there’s been a breakdown somewhere in the system.
I’m probably a different compliance officer than most because I also enjoy the business and strategic side of the work. In a regulated industry, you have to be very aware of not just where your business is going today but where the regulators might take it in the future. In the end, the emphasis for me in this organization is the great work that Knowledge First does. Our mission is to encourage and assist Canadians to obtain a postsecondary education by providing peace-of-mind savings solutions, while our values include putting our customers first and never compromising integrity. Working for an organization with this mission and these values makes a compliance officer’s job a lot easier.
In the end, succeeding as a compliance officer is no different than succeeding in any other line of work; it’s about developing and maintaining effective interpersonal relationships. I’ve always tried to do that over my career, and it continues to work well for me here at Knowledge First.