Compliance &Ethics - Society of Corporate Compliance and Ethics

Compliance & Ethics Professional May/June 2012The problem violation can then be characterizedas an anomaly, a one-time failure by abad actor who circumvented company controlsand was outside the norms of companyculture.But what if such an independent assessmenthad not been previously conducted, andthe company’s ethics and compliance activitieshave not been values-based, comprehensive, oreffective? In recent cases, the government hasbeen willing to set aside debarment determinationsin favor of several company actions,including:··A complete internal investigation thatidentifies the facts surrounding the allegedviolation, the causal factors that led tothe problem, and recommendations forimprovements to processes and controls;··A comprehensive external, independentassessment of the company’s ethicalculture by a values-based ethics expert,including evaluation of the company’sethics and compliance program, and specificrecommendations for improvement;··A company action plan that outlines proposedsteps for implementing each of therecommendations contained in the independentassessment; and··A period of independent monitoring(typically 2-5 years) to evaluate companyprogress in implementing the actionspromised in its plan, and to report onimprovements to the corporate ethics andcompliance posture.The independent monitor as corporate mentorAn independent monitor is often thought of asa corporate “cop” brought in as the result of aDeferred or Non-prosecution Agreement withthe DOJ. A monitor is tasked with reportingon whether the corporate behavior that gotthe company into trouble has either ceasedor is continuing to occur. In some cases, themonitor has been a retired senior militaryEstablishing standards forcorporate self-governance andcreating an ethical culturethrough comprehensive ethicsand compliance programs, andholding contractors accountablefor maintaining these standards,is a more logical way to reducerisk and improve accountabilityto the taxpayer.officer, political appointee, a law firm, or alarge accounting firm that includes monitoringamong several lines of business services it providesto its clients. The monitoring approachis often limited to looking over the shoulderof the subject company to report any obvious,continuing violations in the specific area thatgot the company in trouble in the first place.In the new paradigm of transparency andethical culture as an essential element of governmentcontracting, this traditional, reactiveapproach to monitoring is outdated. SDOs,U.S. Attorney’s Offices, government regulators,and others who scrutinize the behavior ofgovernment contractors and regulated entitiesare focusing greater attention on less punitive,more effective ways of rehabilitating companiesso they can continue to be governmentcontractors, regulated professionals, productiveemployers, and responsible missionpartners. It is not just that these governmententities face unmanageable caseloads (whichthey do), or that they are suffering from woefullyinadequate resources to accomplish theirmission (which they are). Many individualswho have worked in this area believe thatrepeated, multiple government investigationsof contractor misconduct are simply notthe most effective way of making sure that74 www.corporatecompliance.org +1 952 933 4977 or 888 277 4977