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International In-house Counsel Journal logoInternational In-house Counsel Journal logo

On A Strategic Management Approach to the New EU Risk-Based Compliance Regulations

Abstract

CEOs cite the rise of disruptive digital technologies at the top of the list of trends that have had the greatest impact on how they are now leading their organisations. Companies require advanced data analytics, better artificial intelligence-driven processes, and reliable cybersecurity to meet ever-changing threats. To remain competitive and compliant, it is essential that the top management team and the board understand the strategic implications of new and proposed EU regulations calling for risk-based compliance. Although many law firms are creating new compliance departments eager to step in to serve as their clients’ compliance team, compliance is too important a function to outsource. In-house counsel may seek outside advice to better understand how the regulations apply to aspects of their firm's business. But we submit that this sea change requires in-house counsel to work with management to develop a core managerial competency we call strategic compliance management. It may also require in-house counsel to work with national regulators to develop the rules of the road. For example, companies must proactively address demands for increased user rights, including transparency about how personal data are used, and become more skilled at managing the costs of compliance.

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Author

Portrait image of Constance E. Bagley
Constance E. Bagley
CEO, Founder, and General Counsel, Bagley Strategic Advisors LLC, USA

Currently CEO, Founder, and General Counsel, Bagley Strategic Advisors LLC, and Visiting Professor of Law, Copenhagen Business School. Professor Bagley taught for multiple years in graduate and executive programs for managers, directors, and lawyers at Stanford, Harvard, and Yale universities. She is a popular public speaker and the author of multiple articles and books, including Winning Legally: How to Use the Law to Increase Value, Marshal Resources, and Manage Risk (Harvard Business Review Press), The Entrepreneur's Guide to Law and Strategy, 5th ed. (co-authored with Craig E. Dauchy), and Managers and the Legal Environment: Strategies for Business, 10th ed.

Company

Bagley Strategic Advisors LLC logo

Bagley Strategic Advisors LLC

Bagley Strategic Advisors is a boutique consultancy offering customized advice, master classes, workshops, and high level training for executives, including in-house counsel and board members. She has extensive experience teaching and preparing materials for in-house counsel, both in master classes for general counsel at firms like MassMutual, Microsoft, Prudential Financial, and CVS Health, and at the Practicing Law Institute's Corporate Counsel Institute. She has coauthored multiple book chapters and articles with Mark Roellig, former General Counsel and Executive Vice President of MassMutual Financial, and coauthored a piece on compliance in the Harvard Business Review with Bruno Cova, former General Counsel of Fiat and Chief Counsel to the Administrator of Parmalat in the wake of its massive fraud.

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