Cost-Effective Compliance Strategies:  Management Message

Cost-Effective Compliance Strategies: Management Message

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May 12, 2009

Compliance is expensive. The need for external lawyers, auditors, forensic accountants and in-house compliance teams is being questioned as budgets are cut in other areas. Department of Justice representatives have acknowledged that companies are being required to cut-back, but have been quick to point out that anti-bribery compliance shouldn’t be trimmed disproportionately to other areas.

This has prompted some debate about what can be done in this field more cost-effectively. We’re posting a brief series of entries with some “low-hanging fruit”. Taken alone, none of these will amount to much more than an empty gesture. Taken together, these measures can enhance existing programs or form a strong platform for new programs.

“Tone at the top” has been a favorite buzz phrase at compliance conferences for a few years. If a company has a keen compliance officer, but the company fails to back him or her up with resources or staff or the authority to act if problems are uncovered, the program fails and is seen by employees to fail. I have watched companies like this and it isn’t pretty. Typically, one energetic and pro-active employee determines to set the company on a new course. Management expresses support for his efforts right up until his proposals introduce delay into lucrative deals or travel expense for overseas training or, worst of all, he suggests that a large tender in a challenging market is bribe-tainted and the company should withdraw its bid.

The management message is important. It isn’t sufficient, but it’s important. One underused and very effective vehicle for this message is the company’s email. Employees rarely check email and find a message waiting there from the company’s CEO and they will read it when they do. Something brief, definitive and informative works well:

“We are proud of our reputation here at Company X. We make good products at competitive prices. We share responsibility to ensure that we conduct business around the world in compliance with all applicable laws. Under no circumstances will this company condone the offer, promise or payment of anything of value to a government official in order to gain a business advantage. Employees engaged in such business practices will be terminated and risk possible criminal prosecution. A copy of the company’s anti-bribery policy can be found at [webpage]. Specific questions can be directed to [compliance officer]. Should you wish to make a report confidentially, please contact the company’s [hotline/helpline].

Thank you for your support in protecting our reputation here and abroad.”

The CEO

Again, if the company sends this message and does nothing else, the effort is wasted. On the other hand, this can be a powerful tool; it will reinforce the message and can reach all employees in all locations at no cost. Not a bad start.

Defining "Tone at the Top"
When the Nigerians ask it of us.
Cost-Effective Compliance Strategies: Management Message

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