There are numerous reasons to put some serious work into your compliance policies and procedures. They are certainly a first line of defense when the government comes knocking. The Evaluation of Corporate Compliance Programs – Guidance Document (2019 Guidance) made clear that “Any well-designed compliance program entails policies and procedures that give both content and effect to ethical norms and that address and aim to reduce risks identified by the company as part of its risk assessment process.” This statement made clear that the regulators will take a strong view against a company that does not have well thought out and articulated policies and procedures against bribery and corruption; all of which are systematically reviewed and updated. Moreover, having policies written out and signed by employees provides what some consider the most vital layer of communication and acts as an internal control. Together with a signed acknowledgement, these documents can serve as evidentiary support if a future issue arises. In other words, the “Document, Document, and Document” mantra applies just as strongly to policies and procedures in anti-corruption compliance.
The specific written policies and procedures required for a best practices compliance program are well known and long established. According to the 2012 FCPA Guidance, some of the risks companies should keep in mind include the nature and extent of transactions with foreign governments (including payments to foreign officials); use of third parties; gifts, travel, and entertainment expenses; charitable and political donations; and facilitating and expediting payments. Policies help form the basis of expectations for standards of conduct in your company. Procedures are the documents that implement these standards of conduct.
Compliance policies do not guarantee employees will always make the right decision. However, the effective implementation and enforcement of compliance policies demonstrate to the government that a company is operating professionally and ethically for the benefit of its stakeholders, its employees and the community it serves.
Three key takeaways:
- Written compliance policies and procedures, together the Code of Conduct, with form the backbone of your compliance program.
- The DOJ and SEC expect a well-thought out and articulated set of compliance policies and procedures and that they be adequately communicated throughout your organization.
- Institutional fairness for the application of policies and procedures demands consistent application across the globe.