With prosecutions on the increase, there is no time like the present to take a good hard look at your compliance program and how it matches up with the “10 Hallmarks” of an effective compliance program.
I originally wrote about this on Linked In under the title Get Your FCPA House In Order
Recently, DOJ Assistant Attorney General Leslie R. Caldwell revisited the 10 hallmarks of a good compliance program. Addressing an Ethics and Compliance Conference, Ms. Caldwell gave a fascinating insight into the recent, landmark criminal resolution with BNP Paribas, which is the largest bank in France and one of the largest banks in the world. Ending up with a penalty of $8.8 billion, the case revealed the importance of “tone at the top”, and the folly of placing profit margins ahead of business ethics.
While recognising the complexity of monitoring compliance on a global scale, Leslie Caldwell emphasised the need for businesses to put in place a compliance program – one which is communicated repeatedly and enforced properly throughout the organisation. She added that under the department’s internal guidance, the Principles of Federal Prosecution of Business Organisations, prosecutors must consider “the existence and effectiveness of the corporation’s pre-existing compliance program.”
Ms Caldwell stated: “A company should conduct periodic reviews and testing of its compliance code to improve its effectiveness in preventing and detecting violations. Kick the tires regularly.”
So my question to you is – how well are you doing at this?
- How frequently and how effectively, does your company monitor and test its compliance program?
- Does it take into account changes in the operations of the business, including law, business practices, technology and culture.
- Do new products, international operations, and third party relationships trigger compliance reviews?
- Does the process “root out those individuals and companies responsible for corporate financial malfeasance”?
- Will you be able to submit evidence of compliance in the case of an investigation?
To help you get started with a review of your own program, I’ve created a comprehensive self assessment, that includes 180 questions around the 10 hallmarks of an effective compliance program.
- Commitment from Senior Management and a Clearly Articulated Policy Against Corruption
- Code of Conduct and Compliance Policies and Procedures
- Oversight, Autonomy, and Resources
- Risk Assessment
- Training and Continuing Advice
- Incentives and Disciplinary Measures
- Third Party Due Diligence and Payments
- Confidential Reporting and Internal Investigation
- Continuous Improvement: Periodic Testing and Review
- Mergers and Acquisitions: Pre-Acquisition Due Diligence and Post-Acquisition Integration