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In-house Access Insight & Commentary for In-House Counsel Worldwide

Global Compliance Concerns Carry Over Into the New Year

Posted in Ethics & Compliance

Last fall, the US Department of Justice and Security and Exchange Commission released new guidelines to the Foreign Corrupt Practices Act, and the United Kingdom’s Serious Fraud Office unveiled revisions to the UK Bribery Act policies, giving corporate lawyers plenty to mull over within their departments. These two documents provide guidance and regulation for issues such as facilitations payments, business expenditures and self-reporting incidents of bribery. For organizations that do business in many countries, analyzing and understanding these resolutions is imperative. Most important, however, is that the legal department ensures compliance.

For in-house counsel focused on protecting their organizations’ compliance  — a growing concern for GCs around the world — a global compliance program is often the answer. A recent survey of 150 general counsel and chief compliance officers in Europe listed regulatory compliance and training as one of their top on-the-job priorities for 2013. The survey, conducted by Legal Exchange Network (LEN), includes participants from the UK, Switzerland, Italy, Denmark, The Netherlands, Finland, France, Norway, Sweden, Germany and Belgium. In-house counsel’s focus on compliance may extend beyond their legal department to dealings with outside counsel as well. For Law Firm and Client Partnering Best Practices, Lex Mundi suggests ,“clients share their compliance communication plans with outside lawyers.”

When developing a compliance program, there are several factors to take into consideration, from organization needs to protocols for conducting a compliance investigation. As a starting point, the January/February issue of ACC Docket suggests referring to the US Federal Sentencing Guidelines’ (USFG) seven elements for a successful and effective compliance program.

The seven elements are:

  1. Implement compliance standards, codes of conduct, and policies and procedures;
  2. Specify an executive-level individual with the responsibility to oversee compliance;
  3. Put in place certain measures to ensure that no substantial discretionary authority is given to individuals who may have a tendency to engage in misconduct;
  4. Put in place compliance training programs, awareness and communications;
  5. Be consistent when it comes to taking action against misconduct;
  6. Be ready to review your compliance program and initiatives to respond appropriately to misconduct and prevent similar offenses; and
  7. Respond promptly to allegations and take steps to prevent further similar offenses.

Maria Hernandez, leader of the European Compliance department at Pentair, recommends, “going back to the basics to create a successful compliance program.”  During the initial stages of development, Hernandez also recommends that counsel “try to think about the heart of the matter before jumping ahead with sophisticated processes or policies.” For those who are equipped with a legal department led compliance program already in place, training and implementation may be the key to success. As organizations continue to expand and do business internationally, global buy-in reigns supreme.