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Regulation and Compliance > Federal Regulation > DOL

How Content Management Can Help Advisors Handle DOL Fiduciary Rule

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Five years after the passage of Dodd-Frank, a fifth of its required rules haven’t even been proposed yet – leaving a very uncertain regulatory environment.  The Department of Labor’s fiduciary rule announced April 6 will begin to take effect next year. Add it together, and it’s the ingredients for a potentially volatile compliance cocktail.

For advisors, the challenge is how to manage this changing landscape without losing perspective — or your sanity.

The rule imposes a new set of obligations to be implemented, driving concerns that operational models will have to be completely reworked — at a potentially large cost to the bottom line.

The cost and administrative burden of compliance can be overwhelming. Yet firms that have an operational focus and an enterprise content management approach can more easily manage change.

The ECM Approach — A Modern Treatment for Wealth Management

Advisors who embrace enterprise content management (ECM) already have the cure in hand to manage the fiduciary rule.

ECM systems reduce the time and money required for compliance, automating the capture, secure retention and retrieval of content — including paper documents, emails and social media posts — in a secure, searchable repository.

Built-in records management facilitates compliance with record retention policies without impacting the flexibility required to complete work. Seamless integration between ECM and CRM, portfolio management and other systems makes information immediately available, improving client services.

A Shot of Efficiency: Automating Compliance Processes

Manual compliance processes remain a mainstay for wealth management firms. Client information needs to be collected, entered and re-entered. Documents need to be copied, then physically moved between offices.

With ECM, advisors have the cure for efficiently meeting regulatory obligations and streamlining compliance review and approval processes. For example, at Infinity Financial Services, a Laserfiche client that offers personalized wealth management and retirement plan services, the workflow automation software included in its ECM system streamlines its document review process.

Automating compliance processes improves firms’ overall health. Benefits include:

  • Insight into an organization’s processes: Integrating primary applications like client relationship management (CRM) with an ECM system enables advisors to quickly collect data that informs firms about their operations, leading to more informed decision-making.
  • Efficiently managing a large volume of accounts: Batch processing automates review of documents across numerous portfolios simultaneously. For example, advisors can use an integrated CRM and ECM system to quickly create letters to send to clients about market shifts — then automatically log them for compliance review.
  • Ease of enforcement: E-forms and workflow automation  help enforce rules during multiple step processes. For example, Semper Augustus Investments Group LLC, another Laserfiche client, developed a 25-step process using its ECM system’s e-forms software modeled after its portfolio composite software user manual to ensure fair representation of calculations and provide full disclosure of investment results. The automated process serves as a checklist and instruction manual for employees.

A Prescription to Cure Regulatory Anxiety

The healthiest firms will view the DOL’s fiduciary requirements as an opportunity to modernize by adopting these lifestyle changes:

  • Strengthen with technology. An ECM-based operational model can help sustain a firm’s long-term growth and strengthen their ability to cost-effectively respond to regulatory requirements.
  • Wrap with governance. Developing policies and procedures guiding corporate conduct, and using tech tools like audit trails will ensure compliance.
  • Immunize with strategic alliances. A partner with in-depth industry knowledge can help develop a plan addressing not just DOL requirements but a broad range of mandates from the Securities and Exchange Commission and Financial Industry Regulatory Authority as well.

DOL fiduciary requirements have generated anxiety among wealth management firms. Combine ECM with a few simple lifestyle changes, and it’s just the prescription to reverse these effects and restore health and longevity to the firm.


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