Every company wants to create a culture of ethics. If the senior leadership ignores or downplays a culture of ethics, they have narrowed business opportunities for the company, its shareholders, and other stakeholders. A culture of ethics does not guarantee financial success, but it does add to the bottom line financial performance of a company. There are a number of necessary ingredients that have to...
Groucho Marx was (and is) my hero. No one else had a sharper wit. One of my favorite scenes was in Duck Soup when Groucho conducts a meeting as the President of Fredonia. Here is the clip. In particular, when Groucho is given a report and looks through it and says, “Why, even a four-year-old child could understand this report.” He then flips the report...
The SEC continues to plug away at aggressive FCPA enforcement. This year, at least so far, the SEC has had a very successful year. The Hitachi case is a very interesting enforcement action for several major reasons. From a general perspective, the SEC’s decision to file the case in US District Court for the District of Columbia represents an important about face – instead of...
I am excited to support Leona Lewis, a compliance consultant, who has launched a new podcast — Masters of Disaster, in which she interviews professionals in the fields of risk, ethics and compliance. I was happy to be interviewed by Leona several weeks ago. The podcast is available here. My interview focuses on the importance of ethics and creating an ethical culture. Leona is a...
Compliance always boils down to people and interpersonal relationships. No man is an island, and no one can go it alone in compliance. One essential requirement for effective compliance is the ability to engage colleagues and your audience. Many senior executives are smart people –we all understand that. But too often senor executives embrace an interpersonal style of cheerleading. It allows them to appear to...
A Chief Compliance Officer has a number of important relationships to maintain in an organization. Aside from the support of senior level executives, the CCO has to build an effective working relationship with the board and the relevant board committee responsible for ethics and compliance. From an operational standpoint, a CCO has to use the board to advance an issue when frustrated by senior management....
The Volkswagen scandal will be studied for years. One of many themes from the Volkswagen scandal will rest on the complete absence of any commitment to corporate governance. Volkswagen’s weird corporate structure (it is owned in large part by a family) and labor and government interests resulted in a mish-mosh of influences that permitted the family to exercise almost unbridled control over corporate functions, leaving...
I have a lot of pet peeves, especially when it comes to lawyers and compliance professionals. Do not worry — this is a not a column about all of my pet peeves; I would never bore you with all those issues. My current pet peeve in the compliance field is the expression “compliance fatigue.” I am not a paranoid person but anyone who claims that...
The Department of Treasury’s Office of Foreign Asset Control continues to ramp up sanctions enforcement. Even with the likely relaxation of the Iran and Cuba sanctions, OFAC has been continuing its aggressive enforcement program. Thus far, OFAC has collected approximately $270 million in civil penalties, and participated in several major criminal investigations, including Commerzbank and Schlumberger. Commerzbank agreed to pay a total of $1.45 billion...
You have just been hired as the new Chief Compliance Officer of a global company operating in over 80 countries, including numerous high-risk corruption countries. You have no staff and have been given a budget to hire 5 full-time professionals, support staff, and technology, if reasonably priced. When you look into the existing compliance program, you realize that everything is a mess. There are no...
