A framework to assess compliance training effectiveness: The case of banks in South Africa

Abstract

Orientation: Compliance functions constitute a major cost factor for banks, with challenges in demonstrating training effectiveness.

Research purpose: This research intended to design and validate a measurement tool to assess perceived implementation of compliance training effectiveness factors. Validation was achieved using confirmatory factor analysis, and these factors were incorporated into a Compliance Training Effectiveness Framework.

Motivation for the study: There is limited research on compliance training and a lack of theoretical or conceptual frameworks. Compliance training costs can be substantial, including time away from duties. Evaluating training effectiveness is challenging without a framework, yet essential for demonstrating value add. Traditional metrics offer limited insight and fail to capture training’s impact on employee and departmental performance. This research addresses the need for a comprehensive training evaluation framework.

Research approach/design and method: A quantitative approach was used, employing descriptive statistical analysis on survey data. The research targeted all compliance officers in South African banks, using full population sampling. Respondents indicated agreement with statements related to application of training effectiveness factors.

Main findings: The tool was validated through confirmatory factor analysis. Most compliance officers applied the effectiveness factors, except for measuring ‘return on investment’.

Practical/managerial implications: The framework enables selection and measurement of training effectiveness factors, demonstrating value to stakeholders. Compliance officers should be trained on its application.

Contribution/value-add: The research revealed limited use of return on investment calculations, but widespread application of other measures. The framework consolidates training success models and remains relevant for South African banks, demonstrating both quantitative and qualitative value.