Compliance Change Tracking in Business Process Services
This addresses the challenge for compliance officers in managing large volumes of regulatory updates, though it is incremental as it applies existing methods to a specific domain.
The paper tackles the problem of tracking regulatory changes for compliance officers by developing a system that fetches announcements and classifies their actionability and applicability, showing that simple hierarchical classification with bag-of-words and logistic regression work best, with deployment in global delivery centers receiving positive feedback.
Regulatory compliance is an organization's adherence to laws, regulations, guidelines and specifications relevant to its business. Compliance officers responsible for maintaining adherence constantly struggle to keep up with the large amount of changes in regulatory requirements. Keeping up with the changes entail two main tasks: fetching the regulatory announcements that actually contain changes of interest, and incorporating those changes in the business process. In this paper we focus on the first task, and present a Compliance Change Tracking System, that gathers regulatory announcements from government sites, news sites, email subscriptions; classifies their importance i.e Actionability through a hierarchical classifier, and business process applicability through a multi-class classifier. For these classifiers, we experiment with several approaches such as vanilla classification methods (e.g. Naive Bayes, logistic regression etc.), hierarchical classification methods, rule based approach, hybrid approach with various preprocessing and feature selection methods; and show that despite the richness of other models, a simple hierarchical classification with bag-of-words features works the best for Actionability classifier and multi-class logistic regression works the best for Applicability classifier. The system has been deployed in global delivery centers, and has received positive feedback from payroll compliance officers.