Where There is No Will, There’s No Way: The Bottom Line for Chief Compliance Officers

Michael Volkov
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The Volkov Law Group

The Road to Hell is Paved with Good Intentions – Samuel Johnson, 1775.

You can draft and design the best ethics and compliance program – and then fail. 

You can show every compliance professional an “effective” set of ethics and compliance controls, pristine, drafted elegantly, addressing each and every risk with the perfectly calculated impact, and your program may fail. 

Why?

Paper compliance programs are like intentions.  They sound good, they often read well, but they are lacking one important component – the will to execute, and the desire to implement.  It is easy to fine a well-crafted anti-corruption policy; it is easy to draft it, polish it, and impress people with the policy.

It may even be relatively easy to get the board or senior management to approve the policy, and to issue an internal communications announcing the new board-approved policy.  But as every compliance practitioner knows, the work lies in the details and implementation. 

The first step in every implementation plan is at the board and the CEO.  If the board and the CEO understand what has to be done, and provide real and meaningful support, the will could be done.  In the absence of their support – i.e. a meaningful commitment to support ethics and compliance – the well-crafted program will die on the vine.  It will be a slow and painful deterioration in program buy-in, commitment, and frustration. 

There are several common obstacles that arise in building an effective ethics and compliance program.  Let’s name a few – resistance to change, turf protection and the lack of business buy-in.  These are common responses and get played out in a number of ways – e.g. silos of responsibility and authority and unwillingness to incorporate and embrace ethics and compliance controls and responsibilities.

All too often, ethics and compliance professionals experience an unwillingness to own ethics and compliance responsibilities. When corporate actors question the corporate leadership commitment or message, business and other stakeholders will resist unless they personally believe in the ethics and compliance cause.

The important question is to translate the will to the corporate way. If you define the will to senior leadership, communicate specific actions, confirm their commitment, and ensure accountability, the good intentions will be powerful motivators.  All of a sudden, the landscape will be transformed. 

A direction from the board and/or the CEO carries more than just weight – it carries credibility and accountability.  When senior managers and mid-level managers are informed of corporate objectives, their specific objectives, and reminded of performance accountability, change can occur from the top down. This is not an impossible situation – companies under government threats of enforcement or interventions are often forced to change.  Likewise, a board and senior management team that supports ethics and compliance change, can spur actors to join what is a defined as a common cause.

The problem in this area is usually the terms of commitment negotiated by the Chief Compliance Officer with the board and senior management.  A CCO has to be clear and provide tangible actions of support and secure a commitment.  It has to include the entire package – personnel, technology, authority, and tangible commitments from the board and the CEO.  

In many cases, a CCO will hear platitudes of support from the board and the CEO.  When push comes to shove, the will to implement may waver, when hard decisions are being faced, and when ethical business decisions require certain resolutions, that is when a prior commitment has to be followed.

CCOs have to adjust their expectations, and secure the commitments up front, and negotiate for real and tangible commitments.  Without such a clearly defined structure, a CCO may find himself/herself in land of good intentions.

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Michael Volkov
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