Compliance & Ethics Risk Management

The year that just ended was a momentous one for the compliance and ethics (C&E) field. It was marked, among other things, by the imposition of the largest criminal fine in U.S. history (in the Pfizer fraud-and-abuse prosecution), as well as the largest penalties ever imposed in cases involving OSHA, FERC and OFAC related violations. And, by all accounts, there is more – perhaps much more – to come.

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This is the fifth and final post in this series and principally addresses the need to use a risk assessment to help the board of directors oversee the C&E program – the eighth attribute of an effective risk assessment process.

By way of background, in 1996, in the well-known Caremark case, the Delaware Court of Chancery in effect established a requirement that corporate boards oversee their companies’ C&E programs. In 2006, in the somewhat less well-known case of Stone v. Ritter, that state’s Supreme Court affirmed the dismissal of a case brought on Caremark grounds against the directors of a bank which had suffered a compliance failure.

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This is the fourth post in this series and covers the sixth and seventh attributes of effective compliance and ethics (C&E) risk assessment.

The sixth attribute is to assess ethics, as well as compliance, risks. There are several ways to do this.

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