JP Morgan Chase 2015 Annual Report Download - page 57

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Matt Zames
Chief Operating Ocer
and more eective user experience, as
well as introducing a more agile tech-
nology infrastructure.
In Compliance, we enhanced our sur-
veillance to detect potential employee,
client or counterparty market miscon-
duct by implementing e-communica-
tions surveillance in seven languages
across 39 communications channels.
We also extended our transaction sur-
veillance across all asset classes in our
Markets businesses. We broadened
our strategic Anti-Money Laundering
transaction monitoring platform to
transactions in cash, checks, wires,
ACH and prepaid cards across 35
booking locations globally, enabling us
to decommission 12 legacy monitoring
tools and systems.
We will continue to invest in our
people and our culture
The COO drove the global initiative to
establish a Culture and Conduct pro-
gram to reinforce the firm’s Business
Principles across all businesses and
functions. We put it front and center
on the agenda and met with more
than 16,000 employees to hear first-
hand what drives their behavior and
to better understand how to motivate
people to do the right thing. We
implemented a comprehensive gover-
nance structure and reporting that
will allow us to monitor progress
against action plans. Our eorts are
reviewed at all levels of the organiza-
tion, up to our Board of Directors’
Compensation & Management Devel-
opment Committee, and will incorpo-
rate the development of additional
metrics, which will reflect, over time
and in aggregate, trends in the state
of our firm’s culture.
We are deeply focused on recruiting
top talent and training our next gen-
eration of leaders across the firm. In
addition to our eorts to source
tomorrow’s technologists, our veter-
ans’ recruitment program continues
• Legacyapplications:Wesimplied
our technology environment and
decreased operational risk through
our Kill the Tail initiative to reduce
applications across the firm. In 2015,
we decommissioned 13% of our
legacy applications and expect to
decrease this population by a total
of 25% by the end of 2018.
• Stability:In2015,wecontinuedto
achieve more resilient and stable
applications, resulting in a 65%
reduction of technology production
incidents over the last two years.
Our control environment remains
paramount
Our businesses function independently
but with greater connectivity, transpar-
ency and consistency than ever before.
The significant improvements to our
control environment over the past
three years have become part of our
everyday operating model. By the end
of April, we will have completed work
on all 19 enterprise-wide programs
established to tackle our top control
issues and integrated them into stan-
dard business operations. We are work-
ing hard to deliver on milestones to get
more of our outstanding consent orders
lifted by our regulators.
The Risk & Control Self-Assessment
(RCSA) program, a key component of
the firm’s Operational Risk Manage-
ment Framework, is completing its
third cycle and has become fundamen-
tal to how our businesses identify and
manage operational risks and assess the
adequacy of their controls. This year, we
integrated conduct risk measures into
the RCSA, taking a disciplined approach
to how we build and evaluate controls
around employee conduct. During 2016,
we will begin to replace the current plat-
form used to support operational risk
management with a new system called
FORCE. FORCE will increase opera-
tional eciency by driving a simpler
to bring servicemen and women with
unique leadership skills and experience
– for example, in cybersecurity – to the
private sector. The more than 10,000
veterans hired by the firm have made a
demonstrable impact on our culture.
Our Business Principles laid the foun-
dation for the firm’s new Leadership
Edge training program to develop out-
standing leaders and managers. This
year, senior leaders across the COO
organization were major participants
and will be going forward. We will con-
tinue to reinforce a strong sense of per-
sonal accountability and ownership for
everything we do among all employees
in all locations and at all levels.
Looking ahead
We are at the forefront of change in the
industry, and we continue to grow our
core and strategic capabilities to sustain
our competitiveness. Our sophisticated
interest rate and liquidity risk manage-
ment frameworks prepare us for a
range of market scenarios and ongoing
regulatory changes. Our focus on tech-
nology, be it developing innovative solu-
tions, capitalizing on big data or invest-
ing in cyber defenses, underscores the
firm’s commitment to leadership and
excellence and to being the most eec-
tive provider of financial services across
all categories. We continue to invest in
our most important asset, our people.
We look forward to serving the needs of
the next as well as the current genera-
tion of customers, clients and employ-
ees. We will continue to advance and
protect the firm’s position as a world-
class financial institution – in a culture
rooted in both ingenuity and integrity.