The declining economy has exerted a great deal of stress on the country, individuals and the business community. To gain a better understanding of the effect of that risk on the ability of companies to manage legal and ethical risk, the Society of Corporate Compliance and Ethics and the Health Care Compliance Association fielded a web-based survey among the ethics and compliance community in December 2008.

The survey, completed by more than 600 compliance and business ethics professionals, showed that 85% of respondents feel that the current economy greatly or somewhat increases the risk of compliance and ethics failures. So pervasive is the perception that only 1% took the contrarian view and felt that the legal and ethics risks might decline in this period, and not one person felt that risk would be greatly reduced.

The fear of increased risk was greatest among those outside of the health care industry, where 48% felt the risks were increasing greatly, compared to 30% for health care compliance professionals. This is likely due to the health care industry’s being somewhat less cyclical than the economy as a whole.

In what may be a warning sign of future corporate scandals, despite the increase in perceived risk, survey respondents were far more likely to believe that their budgets and staffing would decline rather than increase. 49% felt their budget would stay about the same, and 69% thought the same of staffing. But 36% felt their budgets were likely to decline and 20% are anticipating reductions in staffing. This compares to just 16% who expect an increase in budget and 11% who anticipate a staffing increase.

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