In this podcast series, I am reporting on compliance through the prism of the city of Venice. One of the things that has fascinated me about Venice is how so little of the 21st century has impacted it. Take construction for example. All materials have to be brought to the city via boat, off-loaded and then lifted by hand or by a handmade machine to the upper stories of a building where the residences are located as no one lives on the ground floor. If the building is on the water, the ground floor is now underwater. If the building is not on the water, the ground floor is used for a commercial establishment. But unlike other large metropolitan areas, there is no room for cranes or other large mechanical lifting devices. I thought about this today when I saw workmen lifting up materials through a block and tackle pulley system which has been in use since antiquity. Not only were these guys doing it the old fashioned way, they were getting the job done.
I often write about the nuts and bolts of an effective compliance program but one of the most basic things that an effective compliance program must have is a compliance department present to ask the basic questions of compliance to and receive an answer from. First, and foremost, there must be the requisite number of resources dedicated to the compliance function. This means that a compliance department must be staffed with an appropriate number of compliance professionals to do the day-to-day basic work of compliance. Head count is always important in any corporation but there must be some minimum number of people in the compliance department to answer the phone or respond to email.
In other words, if someone calls, not only does a compliance person have to be there, someone has to pick up the phone. How many times has a compliance department been called on a Friday afternoon to find that no one is there to answer the phone? But if someone is there, they have to actually pick up the phone and provide an answer. Mike Volkov often inveigles against the compliance function being “The Land of No” starring CCO’s as Dr. No; but the situation I am discussing is where a compliance department does not or will not provide the basic answers to a person working out in the field.
Sometimes the most basic and the most obvious is overlooked. Using an old block and tackle pulley to haul up building materials by hand may seem quaint and old fashioned, and perhaps it is, but it still gets the job done. The same concepts are a part of a best practices compliance program; someone must be around the answer the phone when it rings on Friday afternoon and that person who is around must pick up the phone and provide some answers to the question(s) posed.