Hallmark Nine of Ten Hallmarks of an Effective Compliance Program, as articulated in the 2012 FCPA Guidance, states: "a good compliance program should constantly evolve."
Keeping track of external and internal events which may cause change to business process, policies and procedures. Some examples are new laws applicable to your business organization and internal events which drive changes within a company (i.e., a company reorganization or major acquisition).
Continuous improvement requires that you not only audit but also monitor whether employees are staying with the compliance program. In addition to the language set out in the 2012 FCPA Guidance, two of the seven compliance elements in the U.S. Sentencing Guidelines call for companies to monitor, audit, and respond quickly to allegations of misconduct. These three activities are key components enforcement officials look for when determining whether companies maintain adequate oversight of their compliance programs.
The 2012 FCPA Guidance made clear that each company should assess and manage its risks. It specifically noted that small and medium-size enterprises likely will have different risk profiles and therefore different attendant compliance programs than large multi-national corporations. Moreover, this is something that the DOJ and SEC consider when evaluating a company’s compliance program in any FCPA investigation. This is why a “check the box” approach is not only disfavored by the DOJ, but, at the end of the day, it is also ineffectual. It is because each compliance program should be tailored to the enterprise’s own specific needs, risks, and challenges.
One tool that is extremely useful in the continuous improvement cycle, yet is often misused or misunderstood, is ongoing monitoring. This can come from the confusion about the differences between monitoring and auditing. Monitoring is a commitment to reviewing and detecting compliance variances in real time and then reacting quickly to remediate them. A primary goal of monitoring is to identify and address gaps in your program on a regular and consistent basis across a wide spectrum of data and information.
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