Innovation in Compliance: Moving to the Front Lines of Compliance, Part 4-Continuous Improvement

What is the intersection of innovation in your compliance program and the requirements of an effective compliance program? Today, Tom Fox continues his 5-part series on the front lines of compliance with Hallmark IX of the Ten Hallmarks of an Effective Compliance Program, continuous improvement.

• Hallmark 10 states that: “A good compliance program should constantly evolve. A company’s business changes over time, as do the environments in which it operates, the nature of its customers, the laws that govern its actions, and the standards of its industry. In addition, compliance programs that do not just exist on paper but are followed in practice will inevitably uncover compliance weaknesses and require enhancements. Consequently, DOJ and SEC evaluate whether companies regularly review and improve their compliance programs and not allow them to become stale.”
• With internal inspection, you’re looking at your program from the inside out. Ben Locwin explains it like this: “We have a problem. Let’s not run away from it. Let’s embrace it.” To do that, you should ask what you can do better, and what can you do next. The willingness of the organization to look at itself is key to continuous improvement.
• It’s not enough to admit there was a mistake and get rid of the employee who made it. Tom talks about how people aren’t willfully ignorant; they try to do the right things. It could be as simple as a clarity issue with how they understand their role or their work, and if that’s the case, the next employee could easily make the same mistake.
• Instead of laying blame at the people in the organization, it is wiser to do a ‘root cause analysis’ to determine and develop the preventative actions that can keep the problem from happening again. In other words, you fix the system and processes that led to the problem in the first place.

Ongoing Education

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