Implementing Compliance Programs in a Consensus Culture

Abstract

Growth of “Mandatory” Compliance Requirements Since the publication of the US Federal Sentencing Guidelines in 1991, there has been a growing belief that compliance programs for public companies are “mandatory.” Boards of Directors, Audit Committees, regulators and shareholder activist groups have been making it clear that management is charged with the adoption and maintenance of adequate compliance systems and controls. This clarity of purpose around compliance gained momentum following the tragic incident in the US on September 11, 2001. Since that time there has been added awareness in the US of the globalization of the nation’s economy and growing concern about protection of borders and sensitive technology. This has given rise to increased regulation of people and data, not only in the US but around the world. There has also been an insistence by an expanding number of governments that rules of economic fairness be adopted and enforced, and hence, a mounting emphasis on efforts to combat corruption and to mandate further transparency and disclosure of business tactics. This sensitivity has been heightened with respect to emerging markets such as the so-called BRIC countries (Brazil, Russia, India and China).