Registered advisers must designate a CCO responsible for administering written policies reasonably designed to prevent violations, and for reviewing them at least annually. Broker-dealers designate compliance and supervisory principals with parallel duties under finra rules.
The role is not decorative. Regulators bring actions against individuals who failed to implement the program they were given responsibility for, particularly where testing was never performed or red flags were logged and ignored.
For a trading firm the CCO's fingerprints are everywhere a trader looks: personal account dealing approvals, restricted lists, communications archiving, the compliance-manual, and the surveillance that flags patterns resembling front-running or marking-the-close.
Related: compliance-manual, front-running, marking-the-close, registered-investment-adviser, broker-dealer