How to Strengthen the Construction of Internal Control Compliance Culture

Strengthening compliance culture is an idea, a way of thinking and a behavior habit under the guidance of this idea. Only when managers and employees at all levels of banks form the concept and thinking of compliance culture can bank risk prevention become proactive and more effective, and a long-term mechanism for risk prevention can be formed. The lack of bank compliance culture is an important reason for the problems in risk prevention.

At present, the situation of bank case prevention in China is still grim, and bank risk prevention is a very important and urgent topic facing China's banking industry. The causes of internal cases in banks mainly lie in obvious weak links and management loopholes in system, culture and employee's professional ethics. Any operational risk is caused by human behavior. Although people's behavior is constrained by the system, the influence that determines people's behavior comes from the influence of culture. The lack of internal control compliance culture is an important reason for the problems in bank risk prevention. The lack of internal control compliance culture in risk management of grass-roots banks is mainly reflected in the following aspects:

(1) The awareness of risk prevention is weak, and a good internal control and compliance culture atmosphere has not been established. At present, grass-roots banks lack a comprehensive and systematic understanding of risk management and have not yet formed a strong control culture. First of all, there is a lack of overall grasp of risks. The risk is still at the level of fragmentation and partial understanding. Secondly, in the aspect of risk prevention, we fail to plan ahead, often deal with the matter on the basis of facts, and lack prior prevention and systematic management. Thirdly, on the responsibility identification of risk control, it is considered that risk is a matter of internal control, discipline inspection and supervision, which is not closely related to business departments, with insufficient management supervision and unclear responsibilities.

(2) The internal control system is missing, and the culture-oriented mechanism of internal control compliance has not been revealed. There are some problems in internal control management, such as rules to follow, lagging internal control management system and lack of rigidity in system implementation. In addition, the independence of the internal control department is not enough to ensure the objectivity and impartiality of the audit, which is also an important performance that the powerful internal control compliance culture guidance mechanism failed to show.

(3) Lack of professional ethics. Faced with social change, business development, work pressure, opportunities and temptations, risk events and cases follow one after another.

The construction of internal control culture of foreign banks is worth learning.

The Basel Accord clearly points out that any large loss reflects the management's failure to pay attention to the control documents.

The relaxation of culture leads to the lack of appropriate incentives within banks. Although the time of establishment, historical background and regulatory environment of commercial banks in western developed countries are different, under the unified requirements of Basel Accord, starting from their own management reality, they have gradually formed their own operational risk management processes and internal control cultural frameworks. Their practice shows that the following aspects are indispensable factors in the construction of internal control culture, which has important reference significance for Chinese banks to improve the construction level of internal control compliance culture:

First of all, the internal control compliance culture must contain a strong sense of risk. First of all, the relationship between risk and bank cost must be made clear, so that all employees can realize that risk control behavior can directly benefit themselves. Secondly, with the support of senior managers, senior managers should create an internal control culture in which employees fully participate, and should also prohibit employees from doing behaviors that violate risk management values.

Second, the internal control compliance culture must have a detailed construction process. Internal control compliance culture needs a very detailed framework to design its construction process, and each link should have specific implementation procedures and steps to enhance the operability of the construction process. At the same time, the whole construction work should reflect dynamic, sustained and coordinated development.

Third, the internal control compliance culture must highlight the internal cooperation. The construction of internal control compliance culture must emphasize that effective risk management depends on the cooperative relationship among business departments, internal audit departments, risk management departments and other departments.

Fourth, the internal control compliance culture must emphasize good professional ethics. Improving employees' quality and professional ethics awareness is the key to establishing an effective risk control process.

Suggestions on Strengthening the Construction of Compliance Culture in Grass-roots Banks and Promoting the Establishment of Long-term Mechanism for Risk Prevention How to do a good job in the construction of internal control culture, we can consider strengthening the construction of internal control compliance culture in grass-roots banks from the following aspects to further promote the establishment of long-term mechanism for risk prevention in grass-roots banks:

(1) Form a scientific and effective internal control and compliance culture construction system. The first is to ensure the scientific nature of the system. At the planning level of the system, the system is hierarchical and concise, so that each system has a clear definition of the scope of application and a clear order of implementation effectiveness; Establish the process management of system formulation, and form the inherent process and authority; Improve the information collection and conduction feedback mechanism of the system use effect; Regular review, revision,

Sort out and clean up the system to keep it sustainable and effective. It is necessary to emphasize the seriousness of system implementation.

(2) Actively guide the deep recognition of internal control compliance culture. Encourage employees to establish awareness of operational risk prevention and standardization, and make it clear that, first of all, risk prevention is the essential embodiment of the core competitiveness of banks, an important foundation for the sustained and healthy development of banks, and a strong bank is the fundamental guarantee for realizing personal interests. Therefore, bank risk prevention conforms to the same values. Secondly, risk is a continuous long-term process, accompanied by business activities from beginning to end. Third, risks are distributed in all the work of banks. This decentralization determines that every business point is an operational risk point, and operational risks are everywhere. Every employee is the first person responsible for preventing operational risks, and the compliance of his behavior will directly determine the effectiveness of operational risk control. (C) the formation of details determines the success or failure of cultural constraints. The occurrence of bank risks is inevitable. However, depending on the professionalism and attitude of employees, the probability of risk events and cases and the losses caused can be reduced. This professionalism and attitude are reflected in the details. The success of some major cases is the result of accumulating over time. "Details determine success or failure", a temporary violation may not cause losses, but it has planted the seeds of risk. If it can't be stopped in time, it will take root and sprout, forming a cancer. Risk prevention is to establish and strengthen the concept of "violation is risk", develop a solid work style, start from small things, start from dribs and drabs, do all the work conscientiously, and leave no dead ends in management.

(D) Strict team management, building the cornerstone of internal control and compliance culture. Judging from the inducement of banking risk events at home and abroad, moral hazard accounts for a large proportion. As a special enterprise dealing in currency, the characteristics of this industry determine that bank staff must have good professional ethics and form strong self-discipline ability. If there are problems with employees' professional ethics, self-discipline is weakened and moral hazard occurs at any time, even the strict management system will often lose its due effectiveness. To cultivate employees' good professional ethics, we must comprehensively improve the quality of employees from the aspects of professional ethics, cultural knowledge, business skills and modern personality shaping. Stimulate employees' enthusiasm through management, so that employees have more opportunities to participate in management and decision-making, and treat their work as masters, thus showing a high sense of professional responsibility and good professional quality, and overcoming violations. Grass-roots banks must speed up the construction of internal control compliance culture and promote the safe, steady and rapid development of agricultural development bank.