What does the term “compliance” mean? However defined, what is expected of the general counsel?

A sizeable sample of US general counsel reported they spent more time in 2006 on compliance than in 2005. Some 235 general counsel responded to a recent survey by Corporate Board Magazine and FTI Consulting. A press release announced that 55 percent of those general counsel increased their time on “compliance” in 2006 from 2005.

Such a result begs a question: what did those respondents understand by the term “compliance”? The concept can be extremely broad. Everything a general counsel advises on and oversees ought properly to be in accordance with our statutes, regulations, governmental positions, and judicial decisions. What parts of in-house legal services are not observant of compliance with our laws?

The press release unhelpfully quotes an FTI consultant: “Over the past five years, compliance requirements have become acutely more complex, meaning that general counsel have had to assume a broader corporate role in identifying problems and keeping their firms out of the regulatory maze.” “Identifying problems” has no limits (See my post of Nov. 8, 2007 on enterprise risk management.), whereas if compliance comes down to observing regulatory requirements, the task is more manageable.

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