Podcast | S2E9 The Reg Doctor: Sian Lewin

Podcast | S2E9 The Reg Doctor: Sian Lewin

Podcast | S2E9 The Reg Doctor: Sian Lewin 1920 1080 Risky Women

Join us to hear why The Reg Doctor Sian Lewin thinks Governance, Risk and Compliance is sexy! Yep, you heard it here first. She has studied the waves of regulatory change and their impact on financial services and has a focus on RegTech with her own RegTech Women network and business at RegTech Associates.

Points of Interest
  • 01:50 Education & Career
  • 06:26 RegTech Women’s Network
  • 08:28 State of the Market
  • 10:04 Tracking 600 RegTech Products
  • 15:21 Behavioural Changes
  • 18:52 Financial Crime
  • 21:31 Rants & Revelations
  • 24:53 Rapid Fire Round

…the focus of attention, I think has moved slightly from compliance to back to profit making…I think it’s giving regulated firms the opportunity to pause a little bit and think, well, how can we do this better?

just to ALLOW things to feel easier…to anyone who’s really struggling with, you know, wanting to get everything done and being busy, just allow things feel easier. And they will.


Kimberley Cole 0:01
This is Risky Women Radio show to connect, celebrate and champion women in risk, regulation and compliance, sharing insight and perspective from the most influential members of our global Risky Women network. On the latest developments, we need to think about, the challenges we should all talk more about, and innovations we are most excited about in governance, risk and compliance. Bringing together the hundreds of senior women professionals already connected with a new emerging group of leading women and men. I’m Kimberley Cole, your Chief Risky Woman.

Kimberley Cole 0:38
This episode is brought to you by our founding sponsor Refinitiv. Refinitiv serves more than 40,000 institutions in over 190 countries. Refinitiv provides information insights and technology that drive innovation and performance in global financial markets. Refinitiv enables the financial community to trade smarter and faster, overcome regulatory challenges and scale intelligently.

Kimberley Cole 1:03
Welcome to Risky Women Radio. Today’s risky woman is Sian Lewin, who is the head of client delivery and research at RegTech Associates. She’s also the founder of RegTech Women Network. She’s an expert in financial regulation and change management professional. She’s over 20 years of experience managing regulatory change for large financial institutions. In 2017, she was awarded a PhD from the London School of Economics. Her systematic research explored the challenges that banks face in dealing with the volume and speed of regulatory change following the 2008 financial crisis. She’s on the Women in FinTech Power List for 2018. But I want her to tell us a bit more about her career journey. So welcome.

Sian Lewin 1:50
Thank you so much for having me on Risky Women Radio, I’m really excited to be here. So I think my career, if you look at it backwards, looks like it makes an awful lot of sense. But if you look at it forward, things just happen by chance and serendipity. And I just took some risks. So I started my career in the city working for ING Bearings, just after the collapse. And my first role ever was trying to implement a set of global minimum control standards across the organization. So I got to see all sorts of things. From there, I did various large programs such as the introduction of the Euro, working on Y2K, I was out in New York for a couple of years, and I came back, moved into management consulting, and that’s where I really came across regulation for the first time in the good old days of Basel two. I worked for both Deloitte and Accenture, trying to implement all the changes associated with that huge piece of regulation. And that’s really been what my career consisted of up until 2009 when I decided to do a master’s in regulation at the LSE went back into industry, but couldn’t quite let my academic mind and critical thinking go. So I decided to embark on a PhD, which took four years full time, really worthwhile thing to do. And I emerged kind of blinking into the sun in 2017, figuring out what I was going to do. And I’d uncovered a lot of problems and challenges and dealing with regulation as part of that process. And I came across this thing called regtech, the promise of new and innovative technology to solve some of those problems. And that’s what I’ve been working on ever since. Jason, my co-founder and I have been running RegTech Associates for a couple of years, and we’re having a ball.

Kimberley Cole 3:38
Excellent. And I think you’re known as The Reg Doctor, is that correct?

Sian Lewin 3:42
That is correct. It’s a little cheeky name, I call myself but it gets a little bit confusing because my husband is called Reg. So according to him, I’m the Reg doctor, rather than The REG Doctor.

Kimberley Cole 3:57
So tell us a bit more about your PhD because I think It’s really interesting. You’re obviously looking at the the volume and the speed of regulatory change, which hasn’t decreased. What did you you know, what was some of the key findings? And what has that helped you in terms of how you’re advising customers.

Sian Lewin 4:16
So the main focus was the fact that the enormous amount and speed of regulatory change creates enormous amounts of uncertainty for regulated firms, they somehow have to deal with that uncertainty as well as implementing what they need to do to be compliant with those new regulations. So there’s a tension between the level of certainty and the level of compliance that they can achieve. And we’re talking about large organizations that are not just a monolithic whole, they have different types of logics and different teams and different silos, and different objectives as well. So they have the objective to be compliant but they also have the objective to be profitable and deliver shareholder value. And sometimes those to come into conflict and are quite difficult to reconcile unless you try and align those objectives by by finding ways in which being regulatory compliant can actually impact the bottom line in a positive way. I think one of the other things that was really clear to me is that the point of a lot of this regulation is to not just tick the box in terms of compliance, but it’s about trying to change behavior. And if the goalposts are always changing because the regulators are continually producing new rules or amending rules then it’s very difficult and to embed that regulation in that culture of compliance within an organization, and I don’t know, now, whether that’s changed, but that was certainly my findings back in 2013 / 14 when I did the research.

Kimberley Cole 5:55
That’s great. And before we sort of dig into that a bit more deeply, and get onto more around regtech, because this is a great sort of lead in. And we’re trying to do a bit of a regtech series. And so I’m very keen to get into a bit more detail. But I also want to cover the fact that you started or you founded RegTech Women’s Network, which, obviously here at Risky Women, we love another women’s network. So tell us more about what inspired you to form that network and about the network itself.

Sian Lewin 6:26
I, as I mentioned, I kind of started working working in regtech in about 2017. And I was doing two things. One, I was going along to a lot of events, hearing a lot of people speaking about regtech, but I was also meeting people who are working in the industry and there seemed to be a mismatch between some of the amazing women I met, you know, through working in the industry and the people who are talking about the industry and I felt well this doesn’t quite match up. There’s a huge amount of talent here that’s not being heard. And I thought well let’s, let’s, let’s get together and try and fix that. And so I set up an advisory board last December. We’re still fairly nascent, but always wanting to attract new members. We had our launch event in February. And we really focused on empowering women, celebrating our success and collaborate collaborating across the industry, because I believe achieving good levels of compliance and doing the right thing in the industry can only be achieved through collaboration. And we also want to nurture and promote, you know, the emerging talent in the industry and make sure that people have, well, girls, women have role models that they can look up to who are successful in both, not just technology, but also all the other skills that are needed to build successful companies and become compliant.

Kimberley Cole 7:48
Brilliant. That’s exactly I’d say, very aligned to what Risky Women is also trying to do connecting celebrating and championing women in regulation and compliance and this podcast hopes to help some of those emerging women and men in the industry as well. So it’s great to have you here sharing your knowledge and expertise. So you were talking about your PhD. You were telling us about, you know, what you sort of saw back in 2008? And how you, you know, have started to use that. What do you think is the state of the market now, in terms of the level of regulatory challenges and problems?

Sian Lewin 8:28
I think, in terms of regulatory change, we’ve seen a huge wave or a few waves of change, the Prudential Regulation change first and MiFID II had some other changes in terms of GDPR. So I think a lot of the large scale transformations are complete, but that’s not the end of the story, because the regulators continue to amend and change rules on a piecemeal basis. And that, I like to call it tinkering around the edges, creates similar amounts of uncertainty. But it’s actually harder to implement and make those changes for large organizations because they don’t get management attention. They don’t get huge investment program budget, they have to be done as part of business as usual when people are already busy. So I think that’s a huge change. Since I did my research, and the focus of attention, I think has moved slightly from compliance to back to profit making, I think the regulatory expectations and levels of enforcement are themselves dropping as well. I only have anecdotal evidence to back that up. So I think the market has moved and I but I think it’s giving regulated firms the opportunity to pause a little bit and think, well, how can we do this better? How can we deal with this regulation better, more efficiently at lower cost, and reducing our risk at the same time and I think that’s where technology comes in.

Kimberley Cole 9:58
Yeah, that’s what I was going to raise next was what are some of the solutions that you’re seeing?

Sian Lewin 10:04
So at RegTech Associates, we have a really wide view of the market. We track I think we currently attracting about 600 different regtech products across 10 different categories. I’m going to try and remember them, but I might not be successful. So financial crime is by far our largest category. And we’re seeing a lot of use of AI machine learning in terms of fraud detection, transaction monitoring. There’s some really exciting products that we’re working with in that in that area. Regulatory change management and intelligence is also a growing and more competitive category. We’re seeing regulated firms really wanting help with mapping their obligations to their risks, policies and controls. And then when things change, be able to factor that into that process. I think it’s fair to say that there’s no one platform or solution that can do all of that. So it’s a matter of picking the best of breed that can do bits of that lifecycle and somehow attaching them together. Some of the other areas where some fascinating technology is emerging are things like data privacy. So the FCA recently ran a tech sprint on looking at privacy enhancing technologies to allow the sharing of data between organizations for purposes such as fraud and fighting financial crime, which I think shows an awful lot of a lot of promise. You know, when there’s when you’re looking at 600 products, there’s always some that spring to mind. The other area that I’m quite fascinated in having a slightly capital markets background is the area of market surveillance and the use of behavioral science in market surveillance, the use of AI, what else you can get from all of that data. So there’s some great providers out there who bring all of your trade, all of your market data, all of your customer data, all of your transactional data together to surface insights, and patterns, and so on, that you wouldn’t necessarily have seen. And that’s not just for compliance. That’s actually to start thinking about your cost per transaction, which customers are doing what, when to help relationship managers and so on. So there’s some really good thinking around how we can use some of these solutions, not only to yes, achieve compliance, but deliver other benefits on top of that.

Kimberley Cole 12:28
And I think I saw you did a wonderful kind of infographic that sort of displayed all of those different potential solutions.

Sian Lewin 12:36
Yeah, so we have different market maps per category. So just just refreshed our financial crime market map, which is a bit of a bit of a beast to manage, because, as with all these things, there isn’t just one product that does one thing, they span a number of different categories. So we work very hard to make sure that we’re reflecting things accurately and what what we love is that we get quite a lot of interaction on social media and we share those and say “Our products not in there. Can you add it?” So we, we get help we kind of crowdsourcing our view of the regtech market. In some respects.

Kimberley Cole 13:10
We should definitely put a link into the show notes for that. Because yes, it was the financial crime one that I saw, I thought it was very interesting. So we’re talking about the sort of positive, you know, solutions and the way things are changing. Are you seeing that there’s any unintended consequences with either some of the solutions or just the focus on technology and what that means for compliance?

Sian Lewin 13:37
I think we do have to be careful with any kind of technology. There are always risks associated with it. I think with regtech in particular, there’s a couple that spring to mind. One is if we automate the entire end to end process of managing regulation of change, of compliance, it changes where liability sits if things go wrong. For example, if the regulators starts producing regulation in code. And that automatically feeds into, say bank systems effects changes without human intervention. If that code is wrong in the first place, where does the liability for a compliance breach actually sit? And I think more importantly, and this comes back to more ethical issues, if we are outsourcing everything to technology to achieve compliance, we, we have a tendency to outsource responsibility as well. And we can’t, we mustn’t, we must always have humans in the loop, we must always have the application of human judgment. Because this is about affecting behavior, behavioral change, it’s not about just ticking a compliance box and I think there’s the danger of that tipping over.

Kimberley Cole 14:48
Yeah, I think that’s a very good point. You’ve also written several articles on risk and regulatory change from what is the new normal and looking through the reg crystal ball, you also write a fantastic one I thought on sociological thinking and how this can help address financial misconduct. So getting in a bit more into those behavioral elements that I guess that you mentioned just then what are the important themes for you and ones that you sometimes things are overlooked?

Sian Lewin 15:21
One of the things that’s overlooked is this idea of people reproducing their own behavior and their own background. There’s a social theorist called Pierre Bourdieu and he talks about as having a particular habitus, which isn’t just, you know, your background, where you’ve been brought up, it’s actually embodied in you and how you carry yourself, how you dress, the things you’re interested in. And we have a tendency, I think, to, through you know, our own heuristics and biases to stick with people who are like us and not not gonna be different. And I think that inability to accept difference and diversity can be really damaging. If you look at some of the investigations, for example, into the FX scandal and the libel scandal, and you start reading some of the chat messages and the communications, you know, it was almost tribal. And there’s no diversity within that tribe. And I don’t just mean gender and race, I mean, diversity of thinking, of background, of education, of class. I think all of those things are really critical to stop this kind of herd mentality and this acceptance of behavior that in other situations or in other parts of society wouldn’t be deemed as as normal.

Kimberley Cole 16:42
Yes, it was the interconnectedness of that network as well wasn’t it was very interesting I think. I will try to put some of the links into those articles that you wrote on that because I did think they were fascinating.

Sian Lewin 16:53
That was a while ago!

Kimberley Cole 16:54
Yeah! And what is the the main areas where you see that regtech is really having a strong impact now?

Sian Lewin 17:05
It’s quite difficult to say because I think it’s actually a market that’s not yet in equilibrium. I think there is a real desire to embrace it on the side of the regulated firms. And there are some brilliant solutions out there. But the adoption of regtech just isn’t happening at a speed that I would like to see. And I think that’s for a whole host of reasons. I think you’ve got, you know, these large cruise ships of the regulated firms and these nimble little racing yachts and they come from you know, talking about diversity, they come from two different places. So I think the, the large regulated firms, you know, they have lengthy procurement processes you have to get on the preferred supplier list, and they’re quite risk averse in their take up the technology. You’re also fighting against internal technology teams who want to build things rather than buy them. I think there’s a recognition in parts of the organizations that they really need technology to help them. But then there’s a slight suspicion as well. And on the side of the right tech vendors, I think what we’re seeing is an over promise of their capabilities, in some cases, a lot of marketing. And because they haven’t been properly tested, they can’t really prove the things that they’re saying in their marketing. And I think this creates an atmosphere of mistrust, really, which is a real shame. So one of the things we’re trying to do at RegTech Associates is break through this, what we call the fog of innovation, and really try and connect the buyers and sellers together in a way that solves problems and helps the financial industry become safer.

Kimberley Cole 18:44
Excellent. And what what are those kind of most exciting areas or where you seeing that the biggest difference maybe will, you know, progress?

Sian Lewin 18:52
I would really like to see the biggest difference happening in financial crime. I mean, I think if we think about all the areas of regulations This is the one that has huge amounts of societal impact and harm from people being trafficked to human slavery to criminal gangs. And I think we forget sometimes that that’s the purpose of anti-money laundering regulation and so on is to stop that harm from happening. And there are some brilliant brilliant firms out there using artificial intelligence and machine learning to spot these spot the bad guys, using things like link analysis to make those connections between different transactions, different customers. There are some great fraud detection solutions out there as well that are doing similar things and they’re starting to hold huge amounts of data that can say, well, that IP address that is the IP address of a known fraudster and if you start connecting that to other customers to specific types of mobile device, for example, that can surface patterns of fraud that, you know, older technologies can’t. And I think that’s really exciting.

Kimberley Cole 20:05
Yeah, I think that the promise is amazing. Is there any potential that there’s a risk of over reliance on technology?

Sian Lewin 20:12
I think it depends, which is a prevaricating answer! And I think there’s still room for human judgment, I think what technology can do is help and support those human judgments in human intelligence rather than replace it. If you’re automating mundane processes that take a lot of time, that then frees people up to do the difficult stuff and focus on the 1% of things that aren’t going to be caught by technology to deal with the difficult investigations, to deal with the situations that require face to face conversations and negotiation. And which I don’t think computers are quite ready to do but I think it’s got to be a combination of human and machine intelligence.

Kimberley Cole 20:59
Yeah. Absolutely. And what’s the next big risk or uncertainty that you think that the market should be thinking about or preparing for?

Sian Lewin 21:07
I’m gonna say climate risk.

Kimberley Cole 21:09

Sian Lewin 21:10
I really think that that needs to get some serious attention. And it’s not one I think that artificial intelligence can necessarily solve. It’ll be interesting to see what kind of technology solutions come up as part of that, and not necessarily just in financial services industry, but more broadly in society.

Kimberley Cole 21:31
Excellent. That’s really interesting insights there, I think into what’s happening with regtech, what firms should be thinking about and what you know, perhaps the opportunities are, but also some of the challenges. So thank you for that. And we’ll definitely include some of the links to those articles for listeners as well. So onto rants and revelations.

Kimberley Cole 22:02
Connecting, celebrating and championing women in risk, regulation and compliance Risky Women Radio takes an intimate look at the Rants and Revelations of the top women shaping the debate of the industry.

Kimberley Cole 22:15
Bit of fun. What’s your top piece of advice as we talked about, you know, mentoring and helping the next generation that you think helped you as you progress through your career that you would you would pass on?

Sian Lewin 22:29
It’s actually a piece of advice that’s been given to me fairly recently. And the advice is just to ALLOW things to feel easier. And it’s made a huge difference to me, you know, I’ve always wanted to get everything 100% perfect, you know, do everything in a hurry, be busy and actually allowing things feel easier and approach things with a kind of a calmer mentality in a way Yeah, I could do this frame of mind has really made a difference, really made it difference to me and it’s not, it’s very subtle, but I would absolutely say to anyone who’s really struggling with, you know, wanting to get everything done and being busy, just allow things feel easier. And they will.

Kimberley Cole 23:15
Yeah. Be a bit kinder to yourself.

Sian Lewin 23:17
Yeah, absolutely.

Kimberley Cole 23:19
And on to your rant now, so what’s the one thing that if you were the ruler of the world for the day and you had a magic wand, and you could wave it to change, and fix, what would that be?

Sian Lewin 23:32
I think it would be inequality of all sorts. I’m actually, reading The Handmaid’s Tale at the moment, a bit of a slow one to get to grips with that and that’s frightening, frightening dystopia that actually doesn’t seem too far away. But not just you know, gender inequality, but wealth inequality, you know, the poor, the poorest and the richest and you know, even within firms, the disparity of pay between the chief execs and the and the the other workers I think there’s enough in the world already it’s just not distributed properly. And that’s unfortunately a matter of politics and entrenched interests. I could rant forever on that!

Kimberley Cole 24:18
We seem to be able to get people to rant forever but inequality that’s an admirable you know, change that yes, I wish you did have the magic wand to to enable that change. Now, our rapid fire round.

Kimberley Cole 24:37
Risky Women is a vibrant network at the center of the global community in a rapidly growing, evolving and influential industry. Given the continued pace of change our rapid fire round revisit the most pressing topics to share ideas and offer listeners new perspectives.

Kimberley Cole 24:53
Are you ready? One word to describe the world of governance risk and compliance?

Sian Lewin 24:58

Kimberley Cole 24:59
Sexy! Wow. We obviously all need to go and speak more to RegTech Associates. Your cure for the cost of compliance and the wave of regulatory change that we continue to see?

Sian Lewin 25:16
That’s a really hard question. That’s not very rapid, is it? I think being thoughtful.

Kimberley Cole 25:24
Fair enough. And are you optimistic, pessimistic or neutral in your outlook for the year ahead? I’m

Sian Lewin 25:33

Kimberley Cole 25:34
Oh, good.

Sian Lewin 25:35
I was pessimistic earlier on. But I’ve got a bit of hope back now, I think, especially after the news today.

Kimberley Cole 25:44
And a bit more fun now a book that you would recommend that everyone reads?

Sian Lewin 25:48
I’m going to still say what I was thinking in my head, and it sounds a bit pretentious, but, and it’s quite hard to read, but I read Kant’s Critique of Pure Reason when I was at university and it’s really changed the way that I see and understand the world quite a deep level. So that’s my pretentious answer for the day.

Kimberley Cole 26:06
And something to watch?

Sian Lewin 26:08
I’ve been watching billions recently and I love it.

Kimberley Cole 26:11

Sian Lewin 26:12
It’s almost like work.

Kimberley Cole 26:15
And what about your favorite podcast?

Sian Lewin 26:17
Risky Women!

Kimberley Cole 26:18
Oh, of course, of course. Thank you. Well, thank you, Sian Lewin, and for joining us today and sharing your expert opinion on so many areas, especially related to regtech. It’s been brilliant. And thank you for joining us on Risky Women Radio.

Sian Lewin 26:35
Thank you for having me.

Kimberley Cole 26:38
Hi, we’re always looking for sponsors. And if you’d like to get involved and help celebrate and champion women in risk, regulation and compliance, please get in contact at info@riskywomen.org we’d love to have you join the show.

Kimberley Cole 26:58
Thank you for listening to this exciting episode of Risky Women Radio to connect, champion and celebrate women in risk, regulation and compliance. I’m Kimberley Cole, based in Hong Kong. For more information on the Risky Women global network, head to our website and the episode notes and please be part of the ongoing conversation by subscribing to this podcast, connecting with us at Risky Women on Twitter or even reaching out to me directly by email.

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