Honesty is the best policy – when there is money in it. – Mark Twain Compliance professionals encounter a diverse range of corporate personalities in their work. To be sure, compliance officers have to rely on their abilities to analyze, lead, persuade, understand and motivate different functions in a company to contribute to the company’s ethics and compliance function. In doing so, compliance officers have...
The compliance profession is enjoying its moment of triumph. Chief compliance officers are earning substantial salaries and rewarded with high-level positions in the C-Suite and significant influence. CCOs are the hot commodities in the in the corporate governance world. It is an intoxicating time for compliance professionals. In this environment, CCOs have to be wary. CEOs and other corporate leaders know how to talk the...
With an increasing focus on the value of an ethical culture, I have been reading more about chief ethics officers, the separation of ethics and compliance, and the traveling ethics officer who meets with employees to discuss ethics. Forgive me for being a contrarian but everyone is missing the point about an ethical culture. A company does not instill and promote an ethical culture by...
In the compliance arena, like in many others in life, we value simplicity. I have repeatedly stressed the importance of compliance initiatives that are relatively simple. Too often, lawyers and compliance professionals confuse complexity with efficacy. We can all spin together complex compliance controls that address every possible permutation of events, contingencies and possibilities. That is not the challenge. Compliance is a delicate balance between...
In the wake of ever-constant business scandals (e.g. ZTE, VW, Takata, Odebrecht), chief compliance officers have to refresh their approach and strategy. Everyone agrees, or at least I think they should agree, that a company’s most effective control is its culture. For CCOs, selling the board and senior executives on this point should not be very hard. The research and common sense often come together...
Humans have an innate desire to complicate things. When it comes to ideas, professionals are no different – compliance consultants, lawyers, financial advisers and others enjoy solving complicated problems. Such an approach, however, does a disservice to clients and other professionals. Creating complications is not a sign of professional talent; rather, an effective consultant, attorney or financial adviser should be able to take complex issues,...
Two executives were charged last week with criminal violations in the Southern District of New York relating to Valeant Pharmaceuticals activities. These charges are the first of more to come in an ongoing investigation focusing on Valeant’s corporate demise from a high-flying pharmaceutical company. I have written before about Valeant’s rotten culture, slavish devotion to quarterly performance, and short-sighted management culture that ultimately bred a...
Lauren Connell, Managing Associate at The Volkov Law Group, joins us again for a posting on the Wells Fargo scandal. Lauren can be reached at [email protected]. Wells Fargo’s cultural tone is not easily segregated between “top,” “middle” and “bottom.” Despite the recent cross-selling scandal, in which the CFPB led an enforcement action whose fines total a whopping $185 million, Wells Fargo’s CEO John Stumpf reluctantly...
I am not one to beg but I have decided I have nothing to lose here – please, when it comes to compliance, everyone has to adopt a new mantra. The purpose of compliance is not to prevent legal and code of conduct violations. Such a purpose is way too limited in scope and almost guarantees failure, because at one time or another, company employees...
The compliance profession faces many challenges. Some are more important than others. When it comes to evaluating performance, or measuring compliance programs, the profession has a steep uphill climb. Unfortunately, measuring compliance programs and defining what an “effective” program is an issue that requires extensive research and analysis. Justice Potter Stewart’s famous words defining “obscenity” – “I know it when I see it,” just will...
