Companies are embracing the independent and empowered chief compliance officer. The trend is continuing to grow and there is no reason it will stop.
CCOs are no longer reporting to the general counsel but are now moving into the C-Suite where they can exercise a leadership role. CCOs are becoming an invaluable resource in the C-Suite, carrying the responsibility for ensuring compliance and ethical conduct in the company.
But the old adage is also applicable – “Be careful what you wish for, you just might get it.” CCOs are gaining the opportunity to perform and exercise their new found authority. It is an opportunity for which they have long struggled. CCOs have to become a leader in the C-Suite.
The CCO can get lost in the details of a compliance program. The work is endless, the tasks never completed and there is always room for improvement. Hyper-focus on these issues inevitably leads to diminution of the CCO in an organization.
The CCO has to lead. If the CCO does not have sufficient resources to lead, the CCO has to build a constituency and allies to secure resources needed for compliance. The CCO has to look to the board, the board committee and senior managers, and seek out natural allies. If the CCO is not willing to do so, the CCO cannot complain when he or she is denied the resources they need.
The CCOs measure is not just securing adequate resources but to lead in several important respects. The categories of leadership for a CCO include:
Creating a Culture of Ethics: A CCO leads and injects ethics into the culture of a company. This is an educational process which starts with explaining the value of ethical conduct, not just the avoidance of an enforcement action but the real and substantial benefits of an ethical culture. If executed properly, ethical values infuse every aspect of a business, creating a natural pride among employees and managers and dedication to the goodwill of a company.
Integrating Compliance Functions Into Business Operations: A CCO has to produce a value-add for business units. If business managers see the compliance function as a roadblock, then the CCO has failed. On the other hand, if an integrated compliance function is seen as a value add, or an ally in building support for an initiative or business development project, then the CCO has completed an invaluable mission. Compliance has become an integrated part of the business operation.
Communications Partner: A CCO has the same macro-viewpoint as the CEO and other senior managers. With that view and focus of responsibility, the CCO can reinforce CEO communications strategies and specific messages. The CCO can become a natural ally for the CEO.
Conscience of the Company: A CCO can become the conscience of the company. Senior managers and employees may view the CCO as a resource to discuss ideas, questions and problems. A CCO can become a natural problem solver for the company. The CCO, as a leader, can become an important voice in every business decision. The CCO can reflect the collective conscience of a company.