Governance, monitoring and remediation should operate as interconnected components of a compliance framework. For AFS licensees, governance provides oversight and accountability, monitoring assesses whether compliance obligations are being met, and remediation addresses identified issues. Effective compliance occurs when information flows between these functions, and each activity informs the others.
Expanded Answer
Governance establishes the framework for compliance oversight, decision-making and accountability. It defines expectations, allocates responsibilities and provides the mechanisms through which responsible managers, boards and senior management oversee compliance risks and obligations. Governance also determines how compliance information is reviewed and how decisions are made.
Monitoring evaluates whether compliance controls, processes and obligations are operating as intended. Monitoring activities identify issues, control weaknesses, emerging risks and areas requiring attention. The results of monitoring should be reported through governance channels so decision-makers have visibility over compliance performance and risk exposures.
Remediation addresses issues identified through monitoring, incidents, complaints, breaches or other compliance activities. Effective remediation involves investigating causes, implementing corrective actions, assigning accountability and verifying that issues have been resolved.
Key relationships:
- Governance establishes oversight and accountability.
- Monitoring identifies issues and compliance risks.
- Remediation addresses identified issues and underlying causes.
- Monitoring outcomes should inform governance decisions.
- Remediation outcomes should be reported to governance bodies.
When these functions operate together, organisations create a continuous cycle of oversight, improvement and accountability that supports effective compliance management.
Why it matters
Compliance activities become less effective when governance, monitoring and remediation operate independently. Weak connections between these functions can result in recurring issues, poor visibility of risks and ineffective oversight. Strong integration improves accountability, supports informed decision-making and helps organisations demonstrate operational effectiveness.
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Alternatively, explore [complyᵉ] to see how governance, monitoring, incidents, remediation and oversight can operate as a connected system.
Practical guidance
- Map how monitoring findings are escalated to governance bodies and decision-makers.
- Review whether remediation activities are tracked through to completion and reported to governance functions.
- Assess whether governance decisions influence future monitoring priorities and compliance activities.
Further reading
What does a defensible compliance framework look like for AFSL and credit licensees?