Posts by Eric Morehead

Compliance & Ethics Institute Preview with SCCE’s Adam Turteltaub

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This week, we prepare to go to the annual SCCE CEI in Las Vegas. Recent events make the trip more somber, but we look forward to seeing old friends and meeting new ones.  Eric speaks with SCCE’s Adam Turteltaub to discuss what’s new this year at the Compliance and Ethics Institute and some of the thought that goes into planning and organizing the annual event.

Eric also talks a little about the concept of “right action” and moving forward with your goals despite conflict.

It was a year ago that we launched Compliance Beat as we were preparing for the Institute. A big thank you to everyone out there that listens to us weekly. We hope to continue to provide interesting and useful content on compliance and ethics for years to come.

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What’s the ‘Bare Minimum’ Needed for Compliance? Part II

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What is the “bare minimum” an organization needs to have an effective compliance program?  Today we have part II of our discussion of what minimum requirements for an effective compliance and ethics program might be.

Eric talks a little about the focus on organizational guidelines versus the Sentencing Guidelines as a whole. Eric also talks about the importance of reading the guidelines yourself and looking at the nuance of the standards themselves.

We pickup where we left off, discussing the last three hallmarks of the “Seven Hallmarks”.

Eric talks about monitoring and auditing, and how this broad category has no application notes from the Sentencing Commission to help guide the reader.  We also discuss the “evaluating effectiveness” periodically and how this oft overlooked second part of hallmark five should be carefully considered. Finally Eric talks a little about anonymous reporting as contemplated by the guideline.

We also discuss hallmark six which discusses incentives and discipline. Eric spends some time talking about consistent enforcement and promotion — and how considering publicizing results and issues can help promote the program and aid in improving organizational justice. Eric also talks about implementation of incentives and what incentives might look like.

We talk about final hallmark lucky seven. When criminal conduct is detected, organizations must respond appropriately including making modifications to the compliance and ethics program.  Eric talks about how this may include getting outside help.

Finally, Eric talks a little about 8B2.1(C) of the Guidelines, which talks specifically about the importance of periodically accessing compliance risk.

 

 

 

 

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What’s the ‘Bare Minimum’ Needed for Compliance? Part I

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What is the “bare minimum” an organization needs to have an effective compliance program?  Is that even the right question?  Eric talks about a common inquiry that people often have about the “Seven Hallmarks” of the Sentencing Guidelines, and that is: what must we do? In Part I of a two-part series, Eric talks about how the Guideline standards are really the floor for expectations. We spend some time also talking about the guidance in the Guidelines, in particular the importance of the Application Notes of the Guidelines that are often overlooked.

Eric also discusses the treatment of different sized organizations regarding compliance commitment and resources. Eric also mentions that valuable data and information is available at the US Sentencing Commission’s website. We discuss the importance of compliance professionals being directly familiar with the Sentencing Guidelines.

Finally, Eric walks through the first four of the “Seven Hallmarks”. We discuss the fact that what the Hallmarks aren’t even necessarily agreed on all the time (see Joe Murphy’s discussion here). Eric talks about standards, individuals with a compliance program responsibilities, due diligence to ensure no bad actors with program authority and communicating the program.

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Effective Board of Directors Training, Part II

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Your board of directors must stay informed about their compliance duties and stay engaged in your compliance and ethics program to fulfill their obligations as board members.  Training your board of directors is a key responsibility for compliance professionals.  At times, training your board of directors can be a real challenge.

In this second part of a two-part podcast series, Eric again speaks to how can you effectively discuss compliance responsibilities and the key role of the board in compliance with board members and follows up the previous episode with two additional areas of training you should consider.

First, the board needs to be aware of, and educated on, the specific compliance risk for the organization and the board. There needs to be discussion on board-specific risks, or risks based on the director’s roles, and this often includes conflicts of interest, insider trading and other topics tailored to the board’s position and role.  More importantly, the board needs to be trained on, and able to engage on, issues of critical risk for the organization. Remember, the USDOJ talks about the directors having “expertise” and being aware of the risks of the operation. They cannot be engaged and knowledgeable without study and training. Deciding what to train on is tied to your risk assessment and consider carefully what the board should be trained on based on the top tier compliance risks you face.

Additionally, Eric suggests that it is important to provide the “business case” for compliance and ethics at the board level. This is important since the board is ultimately responsible for the culture, so including important data and information about how compliance and ethics, particularly a strong ethical culture, will arm the board for their important role. Eric talks a little about some of the sources of information out there for compiling the business case, including the link between culture and performance, recruiting and retention and reputation.

Be sure to register for our upcoming webinar  “The Road to a New Code of Conduct:  How to Use Best Practices to Update Your Code of Conduct” on Wednesday, October 4 at 12:00pm CST.  Register here.

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Effective Board of Directors Training, Part I

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Your board of directors must stay informed about their compliance duties and stay engaged in your compliance and ethics program to fulfill their obligations as board members.  Training your board of directors is a key responsibility for compliance professionals.  At times, training your board of directors can be a real challenge. How can you effectively discuss compliance responsibilities and the key role of the board in compliance with board members, both new and old?  What is the source law and standards for director’s responsibility for compliance?  What risks do they face for not being on top of these responsibilities? Compliance is the responsibility of the full board, not just the audit  or compliance committee.  Eric talks about the expectations outlined in the Sentencing Guidelines and recent United States Department of Justice Fraud Sections’ new guidance, the Evaluation of Corporate Compliance Programs. Finally, Eric talks about how important it is to provide real information to the board about the content and operation of the organization’s specific compliance and ethics program.

Be sure to register for our upcoming webinar  “The Road to a New Code of Conduct:  How to Use Best Practices to Update Your Code of Conduct” on Wednesday, October 4 at 12:00pm CST.  Register here.

 

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