There was a time when a compliance advisor was viewed as a nice-to-have resource. However, given increasing penalties and legislation to better protect the public, many governing industry bodies and regulators now require members or regulated industry participants, as applicable, to have robust internal compliance programs or provide for lesser penalties if such programs are in place.
Many also require companies to appoint a person upon whom the majority of the compliance responsibility falls. This may be the entire or partial responsibility of General Counsel or other in-house counsel. This individual may assume a lead role with the support of other internal department heads, though not always as part of a formal program. Some companies do manage to make this narrative work, but they may feel their compliance efforts are reactionary and not as strategic, anticipatory or transparent as they or their Board would like.
Still other organizations strive to have a dedicated Chief Compliance Officer, who is expected to grasp the myriad of complex industry- and jurisdiction-specific regulations; develop and implement policies with other departments that prevent and correct non-compliance and risks; test and monitor efforts; anticipate and ward off future threats; manage public relations and stakeholder issues; and speak to these issues at the boardroom table.
And while this makes good sense (and may be a requirement), it can seem almost impossible to find an individual, or even an executive team, with this kind of high-level expertise in today’s market of decreasing skilled resources. That doesn’t mean you’re off the hook.
Where to Turn for Support
You’ve probably seen the mountain of information on best practices for designing an effective regulatory compliance program, with elements including leadership support; training and education; policies, procedures and tools; monitoring and auditing; and measures to take in the event of non-compliance. There’s no one-size-fits-all solution. Staying informed and flexible is key. Below are some tips.
Get to know your regulator. Your industry’s governing body has helpful resources to understand your compliance requirements, filing dates and penalties for non-compliance. Make sure you and your team can access this information rapidly when you need it.
- Visit their website on a regular basis and subscribe to blogs and newsletters.
- Develop relationships with key regulators to learn hot-button issues and avoid potential pitfalls.
Attend industry association gatherings and network. If you’re not already a member, become one. Encourage other department heads to also get involved.
- Get certified in compliance and/or take courses and attend seminars.
- Connect with skilled professionals to see how others manage compliance and broaden your pool of potential recruits.
Reach out to external counsel for help. Your law firm is perhaps one of the best compliance resources available to you. It’s their job to stay on top of evolving legislation and regulations within most regulated industries. Industry-focused external counsel can help by:
- Offering a whole-picture business compliance approach, drawing on resources across the firm;
- Producing written materials that clarify requirements and expectations;
- Sharing new developments in a particular industry or regulatory environment;
- Identifying potential risks related to new market entry/other jurisdictions—they may have offices or connections who can help on the ground;
- Assisting with the development of response plans and issues management; and
- Assessing your compliance program and assisting with remediation.
Whatever approach your compliance program takes, it needs to be flexible enough to meet the ever-evolving needs of the organization and the industry it serves. And while it requires continuous testing, commitment, oversight and maintenance to be effective, guidance and resources are always available if you need them!
Judith McKay is the McCarthy Tétrault‘s Chief Client and Innovation Officer. She leads the firm’s client relations and marketing strategy, and oversees business development, research, pricing, knowledge integration and innovation capabilities. She also provides strategic commercial and intellectual property counsel. Lara Nathans is a Partner and Leader of McCarthy Tétrault‘s National Retail and Consumer Markets Group. She also acts as the firm’s Industry Strategy Leader and is responsible for leading the firm and its people in aligning with the unique needs of our clients and their industries.