Regulatory Compliance Gains Importance in Asia-Pacific Region

Strategic Insights -

As corporate headquarters demand and global trade requirements grow, the Asia-Pacific (APAC) region is waking up to the relevance of international compliance requirements such as Sarbanes-Oxley and Basel II. A recent survey of 148 CIOs from medium-large companies across APAC countries reveals that regulatory compliance will become a significant issue for APAC companies in the near future. While current take-up of regulatory compliance programs has been low, the survey indicates that more than half of the respondents are planning to implement such programs by the end of this year.

Key Takeaways:

  • Regulatory compliance will become an important issue for APAC companies in the near future, with 21% of respondents already implementing regulatory compliance programs and 52% planning to do so by the end of this year.
  • 70% of APAC respondents believe that complying with regulatory compliance standards will give them an advantage over their competitors.
  • 43% of APAC respondents feel that the reason why compliance is important is that it allows them to do business/trade with overseas companies.
  • Nearly one-third of APAC respondents feel that compliance is important because they have to comply with local regulations (current and upcoming).
  • "Being listed in a foreign country and having to comply with their regulations" was another major reason why CIO respondents in APAC feel compliance is important.
  • The survey also showed that most APAC companies surveyed feel that Singapore is the country leading the change in meeting regulatory compliance standards (31%), followed by Japan (20%) and Hong Kong (23%).
  • IT will have a major role to play in meeting regulatory compliance standards, with 88% of APAC CIO respondents thinking that IT has a major role to play in ensuring regulatory compliance.
  • 57% of APAC CIOs feel that they may be held directly accountable for compliance activities in the future.
  • Currently, about 60% of APAC companies spend less than 5% of their total IT budget on compliance-related activities, but this is expected to change, with 27% of companies planning to spend over 15% of their total IT budgets on compliance-related activities in the next 2 years.

Statistics:

  • 21% of APAC respondents have already implemented regulatory compliance programs.
  • 52% of APAC respondents are planning to implement regulatory compliance programs by the end of this year.
  • 70% of APAC respondents believe that complying with regulatory compliance standards will give them an advantage over their competitors.
  • 88% of APAC CIO respondents think that IT has a major role to play in ensuring regulatory compliance.
  • 57% of APAC CIOs feel that they may be held directly accountable for compliance activities in the future.
  • 60% of APAC companies currently spend less than 5% of their total IT budget on compliance-related activities.
  • 27% of APAC companies plan to spend over 15% of their total IT budgets on compliance-related activities in the next 2 years.

Sources:

  • Serena Software, Inc. press release, dated January 17, 2006.
  • Asia-Pacific CIO Survey, conducted by MarketShare for Serena Software, October-November 2005.
  • Serena Software, Inc. website, [www.serena.com](http://www.serena.com).