There are some companies that generate hundreds of millions of dollars but don’t have a compliance program. The lack of a compliance program impacts the business culture and whether intentional or not, it telegraphs an “anything goes” culture.
It also creates personal risk for C-Suite executives and Board members since they have a fiduciary duty to employees and shareholders and can be held personally responsible for the criminal or corrupt actions of the organization.
No compliance program is perfect, but not having any program is not an option. The good news is that government agencies and regulators do not have one gold standard. Different companies can tailor their programs to address the issues specific to their business operations. At a minimum though, develop a code of conduct, designate an employee or department for receiving complaints and establish a channel of communication about the complaints to the Board. Just putting a few basic processes in place goes a long way to addressing the risks in the business.
In this video, Tim Crudo, an Emtrain Expert on Corporate Governance, explains the reasons for having a robust compliance program that is well designed and resourced and the dangers of not having one. This is a perfect video message to share with the C-Suite and the Board to help you make the case for prioritizing and budgeting for a compliance program.
Tim Crudo was the former Chief of the Securities Fraud Section of the U.S. Attorney’s Office in San Francisco and the lead prosecutor in a number of high-profile criminal trials of senior corporate executives in Silicon Valley. Currently, he is a partner at Coblentz Patch Duffy & Bass, where he heads up the firm’s White Collar Defense and Government Enforcement Practice Group.