Compliance controlling: key figures and KPIs for effective monitoring

Compliance controlling is the compass that guides companies safely through the regulatory jungle. Because even the best compliance management should be continuously monitored. If you are wondering how the effectiveness of your compliance activities can be evaluated, then you have come to the right place! The solution lies in the establishment of a compliance management system (CMS) and the use of clearly defined key figures and key performance indicators (KPIs) that enable objective measurement and continuous optimisation. In this article, we present central KPIs that are important for compliance controlling and show how they can help to minimise risks and make processes more efficient. We also highlight the close connection between compliance and controlling.

Why are KPIs crucial in compliance controlling?

Well thought-out compliance controlling goes far beyond mere adherence to regulations. It supports companies in creating transparency, reducing economic risks and improving operational processes. Through the targeted use of key figures, you can analyse and continuously optimise the effectiveness of compliance measures and thus make the digital value contribution of compliance to the company’s success visible.

Important key figures and KPIs

An effective compliance management system is based on several success factors. In our article ‘The 5 building blocks of an effective compliance management system’, we show how these interlock and form a robust overall system.
In the following, we present important key figures and KPIs that can be assigned to these five building blocks and help you to make the effectiveness of your compliance management measurable.

1. early detection & prevention: proactively countering risks

• Regularity and results of compliance audits
  Both the frequency with which compliance audits are carried out and their results are relevant for the evaluation of quality. This shows how often internal or external audits are carried out and what deficiencies are identified.
  Critical audit results can indicate that existing compliance processes need to be revised.
• Investments in compliance in relation to potential fines
  This key figure compares the costs of implementing and maintaining compliance systems with the avoided expenditure on penalties and reputational damage. Companies can thus assess whether their compliance strategy makes economic sense – an aspect that is also becoming increasingly important in neighbouring areas of the company.

In the IT sector in particular, the question arises as to how compliance and value creation can be harmonised, and you can find out how to keep the value creation of your IT in focus in our article on strategies for effective IT value management.

2. regulations & processes: establishing reliable standards

• Duration of processing compliance cases
  This indicator measures the average time from the reporting of a violation to its conclusion.
  A short processing time indicates a well-functioning compliance controlling system with clear responsibilities.

3. training & sensitisation: developing a compliance culture

• Participation rate in compliance training
  This provides information on how many employees regularly take part in training courses. A high rate indicates a strong awareness of compliance issues.
• Repeat participation or training progress
  This key figure shows how many employees take part in recurring training courses or whether they complete training modules that build on each other. The pure participation rate is only an initial indicator. This more in-depth KPI measures whether compliance knowledge in the company is strengthened in the long term – and whether employees are continuously developing, which is a sign of sustainable behavioural change.

4. monitoring & control: ensure ongoing optimisatio

• Number of compliance violations reported
  This KPI provides an indication of how well the existing compliance system is working. The indicator to be measured is the willingness to report – i.e. whether employees have confidence in the system and feel safe to provide information.
  A high number of reports can indicate deficits in the compliance culture and/or insufficient information. Please note: Low values, on the other hand, do not only indicate a well-functioning compliance culture. Such results are also possible with an inadequate reporting culture. This makes it clear that several key figures should always be collected in order to obtain truly meaningful data.
• Trend analysis of infringements over time periods
  This KPI analyses the development of reported violations over several time periods – e.g. monthly, quarterly or annually. Instead of just providing a snapshot, this analysis shows whether the number of violations is stabilising, increasing or decreasing. In combination with training measures or structural adjustments, the effectiveness of compliance measures can be evaluated over time.

5. reactions & enforcement: consistent implementation of the compliance system

• Number of measures taken in relation to the number of offences reported
  It shows how consistently reported violations are actually dealt with and responded to with specific measures (e.g. disciplinary sanctions, process adjustments, follow-up training). A high rate indicates a clear attitude and implementation strength within the company. A low rate may indicate delays, uncertainty or a lack of consistency in dealing with rule violations.
• Rate of sanctioned violations in relation to the total number of reports
  It analyses how many reported violations actually lead to sanctions – of a disciplinary, organisational or procedural nature. This KPI differentiates between reports that were justified and led to a response and those that turned out to be unfounded. It helps to assess the appropriateness and accuracy of the compliance system.

Interactions between compliance and controlling

If you want to understand the importance and benefits of compliance controlling, you should not only look at compliance or management tools in isolation, but also consciously consider the interaction between compliance and controlling.
The two disciplines have a reciprocal relationship: both compliance and controlling are aimed at securing the company in the long term and managing it successfully.
While compliance management aims to prevent violations of legal and internal regulations, controlling supports the management in the planning, management and evaluation of business processes.
Close cooperation between the two areas creates synergies – particularly in the following areas:

• Risk management: The integration of compliance risks into company-wide risk management ensures the systematic identification and minimisation of risks that could jeopardise the company’s success, and you can find out how to effectively integrate compliance risks into your existing strategy on our topic page on compliance and risk management.
• Design of incentive systems: Controlling and compliance must be continuously harmonised with each other. This is necessary to ensure that economic incentives do not lead to irregular behaviour.
• Reporting and transparency: Close cooperation enables relevant data to be processed in a targeted manner and integrated into the reporting system. This enables well-founded decisions to be made.

Success factors for effective compliance controlling

In order for the compliance KPIs presented to be fully effective, companies should also take the following measures:

• Use of digital tools: Even if it may sound banal, specialised software solutions help to efficiently record and evaluate compliance data.
• Regular reporting: The insights gained should be prepared in a structured manner and shared with the relevant stakeholders.
• Link to risk management: Compliance KPIs are considered an integral part of corporate risk management.
• Promoting a compliance culture: Effective compliance controlling can only be established if employees understand and live the importance of compliance.

Conclusion

Compliance controlling is more than just a control function – it is a strategic instrument for ensuring corporate success and integrity. As shown, targeted KPIs and close coordination with controlling can reduce risks, optimise processes and create a sustainable compliance culture. Companies that regularly analyse their KPIs and proactively respond to new challenges not only protect themselves against regulatory sanctions – they also make a concrete value contribution to corporate management through stable, transparent and legally compliant business processes.

Get on your way!

The BAMAC Group is happy to support you because we know how to successfully organise compliance and risk management projects and implement sustainable changes. Find out more about our compliance and risk management services or get in touch with us now for a no-obligation initial consultation.

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