Business Execs Want to Know if Ethics Programs Get Credit from Enforcers
Senior executives and corporate directors want to know the extent to which companies have benefited from implementing effective ethics and compliance programs, but such information is in short supply, according to a recent report by The Conference Board.
In late 2007, The Conference Board surveyed the members of two major ethics and compliance professional associations—the Ethics and Compliance Officers Association and the Society of Corporate Compliance and Ethics. Nearly half of the survey participants stated that they were eager to know whether companies had “received credit” in enforcement proceedings (such as avoiding persecution or reduced sentences) for having a viable ethics/compliance program. Additionally, 95 percent of those surveyed also said that more information about “credit” given to companies by the government in these situations would help them better promote and implement their ethics programs.
According to The Conference Board, “very few” corporate defendants have received ethics and compliance program credit under the 1991 Corporate Sentencing Guidelines. “Since 1999, the Department of Justice has had a formal policy of considering ethics and compliance programs when determining whether or not to bring charges against organizations for the offenses of their employees and other agents. But, the Department has done little to publicize E&C cases under this policy,” says The Conference Board.
According to The Conference Board, its discussions with former and current government officials and private attorneys suggest that: enforcement personnel may not want to provide specifics of their E&C-based charging decisions for fear that this will create precedent that can be used “against” the government; that examining an E&C program as it existed at the time of the offense may be practically difficult; and that enforcement personnel may not feel that they have sufficient expertise to assess the efficacy of a program.
“[T]he government does frequently provide very public examples of how it rewards those who act as ‘good corporate citizens’ by self reporting violations, presumably with the hope that this will encourage other companies to act accordingly. Taking the same approach with E&C programs could lead to similar benefits and would be no more limiting to the government,” The Conference Board says.