Day: January 24, 2020

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31 Days to More Effective Compliance Programs

Day 24 | CCO authority and independence


The role of the CCO has steadily grown in stature and prestige over the years. In the 2012 FCPA Guidance, under Hallmark Three of the Ten Hallmarks of an Effective Compliance Program, it focused on the whether the CCO held senior management status and had a direct reporting line to the Board; stating:
In appraising a compliance program, DOJ and SEC also consider whether a company has assigned responsibility for the oversight and implementation of a company’s compliance program to one or more specific senior executives within an organization. Those individuals must have appropriate authority within the organization, adequate autonomy from management, and sufficient resources to ensure that the company’s compliance program is implemented effectively. Adequate autonomy generally includes direct access to an organization’s governing authority, such as the board of directors and committees of the board of directors.
This Hallmark was significantly expanded in both the 2019 Guidance and the FCPA Corporate Enforcement Policy. And in so doing, the DOJ has increased the prestige, authority and role of both the CCO and corporate compliance function. The 2019 Guidance has four general areas of inquiry around the CCO and corporate compliance function. (1) How does the CCO salary and stature within the organization compare to other senior executives within the company. (2) What are the experience and stature of the CCO with an organization? Does the CCO have appropriate training for the role? (3) How much autonomy does the CCO have to report to the Board of Directors? How often do the CCO meet with directors?  Are members of the senior management present for these meetings with the Board of Directors or of the Audit Committee? (4) Is the compliance function run by a designated chief compliance officer, or another executive within the company, and does that person have other roles within the company?
Three key takeaways:

  1. How can you show the CCO really has a seat at the senior executive table?
  2. What are the professional qualifications of your CCO?
  3. Does your CCO have true independence to report directly to the Board of Directors?
Categories
Accountability: The Heart of Compliance

Boeing, Part 1-Accountability from Employees


We have been getting accountability all wrong in the compliance profession. It’s not a set of tasks – it’s a way of thinking and it has to come from the heart as well as the head. On Accountability: The Heart of Compliance Tom Fox and Sam Silverstein dig into what accountability means to the corporate compliance function and business organizations and most significantly, how to make it an integral part of your culture. In this episode Sam and I begin a three-part series to consider the current disaster Boeing finds itself in from the accountability perspective and what it might do to crawl out of the deep hole it finds itself in. In this Part 1, we consider accountability from employees to their fellow employees and up towards management. Some of the highlights include:
·      What is an employee’s commitment to values in an organization? What are your Foundational Values? Your Relational Values? Your Professional Values? Your Community Values?
·      How employees commit to ‘it’s all of us’ so that all employees rise or fall together?
·      Is bringing in a new CEO enough or must an organization do more?
·      What is an employee’s commitment to a good reputation? How do you get alignment in word and deed to commit to accountability?
For more information on Sam Silverstein and his work on accountability, click here.

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This Week in FCPA

Episode 189 – the Off With Their Heads edition


Will another Kleptocrat lose ill-gotten gains? Jay and I are back to consider some of the top compliance articles and stories which caught our eye this week. We give some final thoughts on the Astros sign stealing scandal, at least until the MLB Report on the Red Sox comes out.

  1. Africa’s richest woman, Isabel Dos Santos, accused of massive looting of Angola during her father’s reign. US companies under scrutiny for facilitating her looting, Michael Forsythe, Kyra Gurney, Scilla Alecci and Ben Hallman in the NYT. Her own bank fires her as a customer, Michael Forsythe in the NYT. PwC CEO warns ‘heads may roll’ over the firm’s work for Isabel Dos Santos, Larry Elliott and Graeme Wearden in Davos, and Juliette Garside in The Guardian.
  2. Tom wraps up his multipart series on the Astros sign stealing scandal; Part 4-The Truth of the Game, Part 5-the Whistleblower and Amensty and Part 6-the Scarlet C. Tom and Matt take a deep dive in this week’s Compliance into the Weeds.
  3. Mike Volkov takes a look at the year in OFAC enforcement. Part 1 and Part 2.
  4. How can you use the Benczkowski Memo internally? Jay explores in his CCI
  5. Latest Edleman Report shows trust going down. Matt Kelly explores in Radical Compliance.
  6. How does the DOJ draft new policies? Clara Hudson reports on Matthew Miner speech in GIR.
  7. Five men indicted in massive crypto-currency scheme. Jonathan Marks on the lessons learned in his Board and Fraud
  8. Lawyers from Skadden Arps compare and contrast UK and French guidance on cooperation. In NYU’s Compliance and Enforcement Blog.
  9. Was the SFO’s internal guidance a missed opportunity? Aziz Rahmen thinks so, in the FCPA Blog.
  10. On the Compliance Podcast Network, Tom continues his 31 Days to a More Effective Compliance Program series. 31 Days to a More Effective Compliance Program now has its own iTunes channel. If you want to binge out and listen to only these episodes, click here.

Tom Fox is the Compliance Evangelist and can be reached at tfox@tfoxlaw.com. Jay Rosen is Mr. Monitor and can be reached at jrosen@affiliatedmonitors.com.

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Daily Compliance News

January 24, 2020, the Biggest Tax Scam Ever? edition


In today’s edition of the Daily Compliance News:

  • Angola: Where did all the money go? A 5-part series. (TheAfricaReport)
  • The biggest tax scam ever? (NYT)
  • How compliance can create better corporate culture. (WSJ)
  • Harvard and Texas A&M in spat of article on health effects of eating red meat. (Houston Chronicle)