How Organizations Commit to Compliance

 
 
By Dennis McCafferty  |  Posted 10-06-2016 Email
 
 
 
 
 
 
 
 
 
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    How Organizations Commit to Compliance
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    How Organizations Commit to Compliance

    Organizations should consider increasing the input of compliance officers on overall strategic business planning—something relatively few companies are doing.
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    Delegated Duty
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    Delegated Duty

    98% of global execs said their senior leadership is committed to compliance and ethics. However, 55% indicate that senior leadership only provides ad hoc program oversight, or delegates most compliance and ethics oversight activities.
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    Assigned Program
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    Assigned Program

    67% said their organization uses a process to identify owners of specific compliance and ethics-related risks.
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    Assigned Roles, Part I
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    Assigned Roles, Part I

    73% said their in-house compliance committee regularly identifies compliance-related risks, and 70% said it reviews (annually) the effectiveness of the compliance program.
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    Assigned Roles, Part II
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    Assigned Roles, Part II

    69% said their in-house compliance committee regularly approves corporate compliance policies or policy revisions, and 55% said it assesses business risks and their impact on compliance.
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    Comprehensive Approach
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    Comprehensive Approach

    77% said their company has an enterprise risk management (ERM) process. Of those which do, 88% said their ERM program covers compliance and ethics-related risks.
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    Extra Effort
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    Extra Effort

    54% of those with ERM processes conduct compliance and ethics-specific risk assessment activities beyond ERM efforts.
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    Diminished Role
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    Diminished Role

    Just 36% said their compliance officers are "inherently integrated" or "play a key role" in their organization's strategic planning.
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    In Touch
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    In Touch

    82% said their senior leadership formally communicates with employees regarding compliance and ethics topics.
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    Top Ways Senior Leadership Communicates with Employees About Compliance/Ethics
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    Top Ways Senior Leadership Communicates with Employees About Compliance/Ethics

    Email: 82%, "Town hall" meetings: 59%, Business unit meetings: 46%, Video messages: 38%, All hands calls/meetings: 28%
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    Untapped Input
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    Untapped Input

    Just 21% take advantage of employee surveys to gather information for their risk assessments.
 

Reflecting an era when risk has emerged as a growing business concern, senior leadership at nearly all organizations remains committed to compliance and ethics programs, according to a recent survey from PwC. The resulting report, titled "PwC State of Compliance Study 2016: Laying a Strategic Foundation for Strong Compliance Risk Management," indicates that most senior leaders are delegating this role, frequently identifying "owners" of specific compliance and ethics-related risks and assigning tasks accordingly. Most have launched an enterprise risk management (ERM) process that covers compliance and ethics. And the majority of survey respondents said their senior leaders formally communicate with employees about these topics. To take compliance/risk efforts to the next level, however, organizations should consider increasing the input of compliance officers on overall strategic business planning—something that relatively few companies are doing. "The connection of compliance to business strategy—including tone at the top, risk assessment and oversight and responsibility—lays the strategic foundation for both a culture of compliance and ethics, and (of) management programs that help ensure the organization conforms to all necessary regulatory requirements and ethical standards," according to the report. "Without strong alignment of compliance management to business strategy, it is difficult to efficiently integrate compliance into business processes and to assess the effectiveness of compliance efforts against strategic objectives." More than 800 global execs took part in the research.

 
 
 
 
 
Dennis McCafferty is a freelance writer for Baseline Magazine.

 
 
 
 
 
 

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