The Relationship between the Board of Directors and the Compliance and Ethics Officer 1/21/2014 3:16:35 PM
For a compliance program to be deemed "effective" under the Sentencing Guidelines the organization’s governing authority must "…exercise reasonable oversight with respect to the implementation and effectiveness of the compliance and ethics program." Yet, while many other aspects of the Guidelines have grown well established, the relationship with the board of directors is still far from mature. Many compliance officers report concerns about whether the relationship is as strong as it should be, or even if it is serving its intended role of enabling the board to exercise sufficient oversight.
Compliance and Ethics has won its seat in the C-Suite. For most companies, the department reports to the board or the CEO, meets with the board regularly and has won the appreciation of the board of directors. Yet, the success is not uniform, with some companies still following the older model of having compliance teams that report to the General Counsel or other departments.