The future of compliance is digital, and as the upcoming Conduct of Financial Institutions (COFI) Bill introduces heightened regulatory obligations, financial advisers must embrace technology to stay compliant and enhance their operational efficiencies. Automation and digital tools are essential for streamlining compliance processes, reducing administrative burdens, creating capacity in the business and enhancing the client experience during the engagement process.

Financial practices that integrate compliance with best practice principles during the client engagement process by using automated technology will not only stay ahead of compliance requirements but will also build a foundation for a more agile, scalable, and client-centric experience.

How COFI is raising the compliance bar

Unlike previous regulatory frameworks that focused on a rules-based approach, COFI introduces principles-based regulation, meaning that financial advisers must go beyond simply following rules. They must actively demonstrate that they are prioritising fair client outcomes, transparency, and ethical conduct.

This shift requires:

  • Enhanced documentation: Advisers must maintain clear, auditable records of all client interactions, financial advice, and decision-making processes.
  • Proactive risk management: Firms must identify, assess, and mitigate compliance risks before they become regulatory violations.
  • Effective client engagement: Financial advisers must ensure consistent, transparent, and ethical client interactions in line with COFI’s principles.

Given the increased expectations, relying on manual compliance processes is no longer sustainable. This is where automation becomes an indispensable tool.

Automation can help in several key areas:

  1. Streamlining documentation and record-keeping

Keeping manual records is time-consuming and there’s also the risk of human error.

Automated documentation tools can:

  • Digitally capture client interactions in a centralised system, making retrieval easy for audits.
  • Automatically log advice and decisions, ensuring compliance with COFI’s transparency requirements.
  • Ensure data security and regulatory alignment, reducing the risk of non-compliance.

  1. Automating compliance reporting

Under COFI, financial firms will have to report on compliance activities regularly. Automated reporting solutions can:

  • Reduce the manual workload, freeing up time for advisers to focus on client needs.
  • Ensure timely, accurate submissions to regulatory bodies.
  • Provide real-time compliance monitoring, flagging potential risks before they become a threat to the business.

  1. Enhancing client engagement

With COFI emphasising fair client outcomes, automation helps advisers to establish consistent client experiences while ensuring compliance. AI-driven and automated tools can:

  • Offer personalised financial insights based on client data.
  • Send automated client communications and reminders, ensuring ongoing engagement.
  • Streamline digital onboarding, making the process more efficient while maintaining regulatory compliance.

  1. Reducing human error and mitigating compliance risks

Manual processes increase the risk of mistakes, which can lead to non-compliance. Automated workflows help by:

  • Standardising compliance tasks, ensuring nothing is overlooked.
  • Setting up alerts and notifications for upcoming deadlines or regulatory changes.
  • Automating risk assessments, identifying compliance gaps before they become problems.

Types of automation that can transform compliance

Financial advisers can integrate several types of automation to enhance compliance and efficiency:

  1. Regulatory Technology (RegTech) solutions

RegTech tools use AI, big data, and machine learning to help firms comply with regulations efficiently. These solutions offer:

  • Real-time monitoring of compliance activities
  • Automated risk assessments
  • AI-driven insights for proactive compliance management

  1. Customer relationship management (CRM) systems

Modern CRM platforms designed for financial advisers can:

  • Store and manage client data securely
  • Automate follow-ups, check-ins, and reporting
  • Ensure regulatory alignment in client communications

  1. E-Signature and digital document management

E-signature platforms streamline compliance by:

  • Enabling secure, legally binding document approvals
  • Reducing paperwork and improving efficiency
  • Ensuring proper document tracking for audits

  1. Automated workflow and task management

Financial advisers can use workflow automation tools to:

  • Assign compliance tasks and track progress efficiently
  • Set up reminders for regulatory deadlines
  • Ensure all compliance steps are followed without manual intervention

With COFI setting a higher standard for ethical financial services, financial advisers must act now to modernise their approach to create capacity for servicing clients. Advisers are aided by joining advisory networks, such as Graviton, that offer these types of tools.

 

 

 

Graviton Financial Partners (Pty) Ltd is an authorised financial services providers in terms of the Financial Advisory and Intermediary Services Act,2002. The information in this article does not constitute financial advice While every effort has been made to ensure the reasonableness and accuracy of the information  contained in this article (“the information”), the FSP, their shareholders, subsidiaries, clients, agents, officers and employees do not make any  representations or warranties regarding the accuracy or suitability of the information and shall not be held responsible and disclaim all liability  for any loss, liability and damage whatsoever suffered as a result of or which may be attributable, directly or indirectly, to any use of or reliance  upon the information.