The DOJ continually speaks about the need for companies to operationalize their compliance programs. Businesses must work to integrate compliance into the DNA of their organization. Having a Board member with specific compliance expertise or heading a Compliance Committee can provide a level of oversight and commitment to achieving this goal. The DOJ enshrined this requirement in the FCPA Corporate Enforcement Policy. This means that when your company is evaluated by the DOJ, under the factors set out in the 2020 Update and FCPA See more +

The DOJ continually speaks about the need for companies to operationalize their compliance programs. Businesses must work to integrate compliance into the DNA of their organization. Having a Board member with specific compliance expertise or heading a Compliance Committee can provide a level of oversight and commitment to achieving this goal. The DOJ enshrined this requirement in the FCPA Corporate Enforcement Policy. This means that when your company is evaluated by the DOJ, under the factors set out in the 2020 Update and FCPA Corporate Enforcement Policy, to retrospectively determine if your company had a best practices compliance program in place at the time of any violation, you need to have not only the structure of the Board-level Compliance Committee but also the specific subject matter expertise (SME) on the Board and on that committee.

All of this means that every Board of Directors needs a true compliance expert. Almost every Board has a former Chief Financial Officer (CFO), former head of Internal Audit, or persons with a similar background, and oftentimes, these are also the Audit Committee members of the Board. Such a background brings sophistication, training, and SMEs that can help all companies with their financial reporting and other finance-based issues. So why is there not such SME at the Board level from the compliance profession?

Three key takeaways:

1. The 2020 Update required active Board of Director engagement and oversight around compliance.

2. Board communication on compliance is a two-way street, both inbound and outbound.

3. The Delaware courts have been expanding Board's roles through the expansion of the Caremark Doctrine. See less -