An expert on compliance offers some thoughts about compliance heads reporting to the general counsel
My friend, Jeff Kaplan, offers some good ideas about how to assure the independence of a chief ethics and compliance officer (CECO) who reports to the general counsel.
“However, even where the analysis leads one to conclude that administrative reporting to the GC is best for the company the CECO should still report “informationally” to the audit committee of the board (and possibly the CEO), as well as to the GC. This should generally include regular reports on the operation and efficacy of the C&E program, as well as real-time reports of any allegations of wrongdoing made against senior managers. Finally, companies should consider enhancing the independence of CECO’s who report to GC’s by providing in program governance documentation that the audit committee must pre-approve any termination of employment or significant diminishment of duties or compensation of the CECO.”
The quote comes from Jeff’s article in Corporate Compliance Insights, July 19, 2010.