As compliance programs mature, it is becoming increasing
clear that one size does not fit all. Moreover, there may be several different
approaches to creating the most effective compliance program for your
organization. This past week I attended the ACI FCPA Boot Camp in Houston. Many
of the presentations dealt programs, procedures and process companies had
developed specifically for the compliance issues they have faced around the
globe. One of these was in a session entitled "Compliance Programs 2.0" where
one of the subjects discussed was who to embed as a local compliance
representative in an international business unit.
On this discussion panel were two lawyers, Rick Chapman,
Assistant General Counsel at Halliburton and John Lewis, Sr. Managing Counsel -
Compliance Global Anti-Bribery Counsel, they presented two distinct views on
utilizing local compliance point persons in their company's respective
international anti-corruption and anti-bribery efforts. I found that each
company's approach had merit and that they are both models which you can review
to determine which might be best suited for implementation in your
Rick Chapman described the structure that Halliburton
utilizes as a conduit to the compliance department. The local compliance
resource is named as the "Local Compliance Advocate (LCA)" and is generally not
an attorney or in the company's Legal Department. The employee is a local
business unit employee who Halliburton embeds within the compliance function.
Initially the compliance group will identify a person who can handle this role
and will then provide them with specialized compliance training.
Mr. Chapman remarked that two of the main roles of the
LCAs are to provide compliance training to other employees in the business unit
and also to listen to the compliance concerns of Halliburton employees on the
ground. As the local eyes and ears of the compliance group, they can bring
day-to-day concerns back to the home office for review and assessment. In this
manner they are viewed as a conduit to the compliance group, headquartered in
John Lewis contrasted the Halliburton conduit approach
with that of Coca-Cola regarding local compliance resources. Coca-Cola utilizes
regional counsel from the Legal Department to act as "Legal Ethics Officers
(LEOs)." While these LEOs are lawyers, Mr. Lewis made clear that they are
employed in the Legal Department and not in the local business unit. In their
role, LEOs have authority to make preliminary compliance assessments regarding
day-to-day compliance issues. The company views them as the first line of
Mr. Lewis said that one of the key reasons that the
company takes this approach is in dealing with foreign governmental officials.
LEOs have authority to make contact directly with foreign government officials
and present the company's position on compliance issues. He stated that this
brings one additional level of review and assessment to the company's
compliance regime and that this could be important if a regulator reviewed any
decision made by the company in the context of the Foreign Corrupt Practices
Act (FCPA), UK Bribery Act or other anti-corruption laws.
I found both of these methods to create and utilize a
local compliance representative creative and economically efficient. They are
systems to help embed the concept of compliance within the local and
international culture of an operation. By utilizing such resources, whether
they be in the "conduit" format or the "first line of defense" format, I
believe that a company can drive home, on a daily basis, how to conduct
business ethically and within the parameters of anti-corruption laws.
Visit the FCPA Compliance and Ethics Blog,
hosted by Thomas Fox, for more commentary on FCPA compliance, indemnities and
other forms of risk management for a worldwide energy practice, tax issues
faced by multi-national US companies, insurance coverage issues and protection
of trade secrets.
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© Thomas R. Fox, 2012
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