Compliance Program Governance: Some Practical Advice from our Profession’s Past

Today it is easy to get all kinds of advice.  The Internet had already opened access to sources worldwide.  Now AI has taken this to extraordinary new ends, even giving us a written analysis of what we should do next, drawing from huge data resources.  So, does this mean we can access everything we would want to know to do our jobs most effectively? 

It turns out that while AI will research and access current items, it does miss some of the ideas from “ancient times” and ancient writings (i.e., even just a few decades ago, when I was younger but doing compliance work).  The following ideas on governance of compliance and ethics (“C&E”) programs are drawn from materials developed in the early days of C&E and assembled in a book I wrote in 2008 for the Society of Corporate Compliance and Ethics, called 501 Ideas for Your Compliance and Ethics Program. The ideas draw on my experience in those early days and in vintage publications like Corporate Conduct Quarterly and ethikos.  Some of these may be things you have considered but may not have known that companies had been doing in the 1990s or the first decade of this Century. The 501 Ideas book includes reference to some company examples where the ideas were actually implemented;  these can help convince management that a “brilliant” idea you have is not just something you cooked up out of the blue, but has previously been tested out elsewhere.

Here are some selections I particularly wanted to offer, including ones I have not seen or read about in recent literature in our field.[1]  They address the compliance officer and program infrastructure, and the board’s and senior management’s role in the C&E program.

54. Workshops for C&E professionals. In large companies you may have people throughout various parts of your business doing some aspects of C&E. These may be ethics champions, or compliance ambassadors, or business unit compliance officers. Consider having training for these field people, such as workshops, so they are better informed about state of the art in this field. For someone new to this field it can be daunting trying to learn about this field on your own.  
55. SME plans. Companies typically have a variety of key compliance risk areas. You could require those responsible for each major area (i.e., subject matter experts or “SMEs”) to develop an annual plan on how they will assess and mitigate the risks in their specific area. The Chief Ethics and Compliance Officer (“CECO”) could develop the plan template for each subject matter risk leader to follow.
56. Interdepartmental compliance committee. Having a committee with representatives from key groups such as legal, HR, security, IT, etc., can be key in coordinating C&E activities and advising the CECO. It helps avoid having the C&E team operating in isolation and can bring additional resources into the C&E effort.
57. Have business unit C&E officials in each subsidiary and business unit. There is enormous value in having representatives of and advocates for the C&E program in each part of the business. The sources supporting this idea include an article I wrote on this topic in 1996.  The current status is well-covered in Matt Silverman’s book, The Champions Network: A Blueprint to Expand Your Influence and Spread Big Ideas in Any Organization, https://ideasandanswers.com/the-champions-network-by-matt-silverman-how-to-bring-your-compliance-ethics-program-to-life-throughout-the-company/   
58. Global compliance conference. For global companies, it can be well worthwhile to bring your compliance people together to compare notes and exchange ideas. This can also give the CECO a better idea of what is happening out in the field. Of course, virtual meetings are less expensive and time consuming, but there is also great value in the human interaction of in-person meetings.   
59. C&E career path. Larger companies could develop career paths for employees in C&E and other control functions. For example, a C&E person could be scheduled to spend some time in internal audit, then working in HR to gain skills in that area, and perhaps thereafter a C&E post out in the field.    
60. CO Exit interview. The board or audit committee can require an exit interview for any departing CECO or direct report to the CECO. This can help deter improper harassment of the CECO and also help keep the board informed about what is happening in the C&E program. It also helps demonstrate the board’s diligence and oversight.  
61. Board code of conduct. As part of the work to develop a positive tone at the top, have the board officially vote to adopt the company’s code of conduct and to specify that it applies to the board itself. This can help send a message about the code’s importance in the company.
62. CEO executive meetings. It is easy to talk about tone at the top. Here is one very direct and practical way the CEO can make a serious mark.  At the regular meetings of senior executives, the CEO can go around the table and have each executive report on what he or she has done to promote the C&E program. Given the competitive nature of senior executives this can lead to development of new C&E initiatives, as well as raising the profile of the business unit compliance managers reporting to these senior managers.   
63. “Invitations” to visit the board. If a business unit is lagging in its commitment to the C&E program, the board or a board committee can “invite” the leader of that unit to come visit that committee and explain why this is so. The impact can be salutary. 

Some of these ideas might fit perfectly for your company.  Certainly, any company of any size could have its board resolve to be bound by the company code of conduct. It could decide to require a board level exit interview whenever a CECO left the company.  Even better, though, an idea here might inspire you to develop something more effective that will fit perfectly in your company.  At Compliance and Ethics: Ideas & Answers we are always looking for new ideas and ways to make C&E programs more effective.  We would love to hear your ideas and perhaps feature them in one of our future articles.   

[1] The numbers are taken from the book, so they are easy to find in the original.  The book can be found on SCCE’s website, https://www.corporatecompliance.org/501-ideas-your-compliance-and-ethics-program .