The Anti-Corruption Report

The definitive source of actionable intelligence covering anti-corruption laws around the globe

Articles By Topic

By Topic: Compliance Budget

  • From Vol. 7 No.21 (Oct. 17, 2018)

    Lessons From AB InBev’s Data Analytics Program: The Future is BRIGHT, and the Future Is Now

    Though the concept of data analytics often piques the interest of compliance officers, integrating a comprehensive system into a compliance program can be daunting. In this guest article, Matt Galvin, the vice president for ethics and compliance at beverage giant AB InBev, explains what the company learned from its experience developing and implementing BREWRight, a data analytics program that he argues has vastly improved the company’s compliance functions, and that has the potential for even more impressive results in the future. See “Using Data Analytics to Boost Compliance Program Effectiveness” (Jun. 27, 2018).

    Read Full Article …
  • From Vol. 7 No.17 (Aug. 22, 2018)

    When Every Employee Is a Keeper of the Company’s Culture: An Interview With WD‑40 Company’s Karla Pinckes

    A company’s culture is one of the most important elements of a successful compliance program, but how does a company teach something as ephemeral as culture? How does a compliance department move beyond seeing itself, and being seen as, the bribery police? The Anti-Corruption Report spoke with WD‑40 Company’s associate general counsel and assistant corporate secretary Karla Pinckes about her company’s approach to compliance and ethics messaging. By focusing on core values, she explained, the WD‑40 Company is able to empower all of its employees to take an active interest in the company’s wellbeing. The values focus also impacts how the company’s compliance and ethics department operates. Pinckes encourages her staff to see and promote themselves as culture keepers, an approach that is reaping dividends in close relationships with the business and company-wide support for compliance. See “Finding the Softer Side: VMware’s Senior Director of Ethics and Compliance Discusses Her Department’s ‘Re-Brand’” (Jan. 24, 2018).

    Read Full Article …
  • From Vol. 7 No.16 (Aug. 8, 2018)

    Ian Hawkins of NBCUniversal Talks Tools for Building a Modern Compliance Program

    As the focus of many compliance departments shifts toward values and away from rules, compliance officers face new challenges. Ian Hawkins, director of international compliance at NBCUniversal, spoke with The Anti-Corruption Report about values- versus rules-based programs, obtaining buy-in from leadership, using artificial intelligence and data analytics to enhance a program and the changing composition of compliance departments. In a companion article, we spoke to Hawkins about how compliance officers can integrate nudge theory into their programs to encourage ethical decision-making. See “Finding the Softer Side: VMware’s Senior Director of Ethics and Compliance Discusses Her Department’s ‘Re-Brand’” (Jan. 24, 2018).

    Read Full Article …
  • From Vol. 7 No.15 (Jul. 25, 2018)

    Ian Hawkins of NBCUniversal on How Nudge Theory Can Improve a Compliance Program

    Can placing signatures at the top of documents or displaying posters with eyes promote ethical behavior? According to nudge theory, these kinds of small reminders, or “nudges,” can have significant effects. Ian Hawkins, director of international compliance at NBCUniversal based in London, spoke with The Anti-Corruption Report about this theory and other behaviorial science techniques as well as how they can be used by compliance departments to enhance their programs. See “Finding the Softer Side: VMware’s Senior Director of Ethics and Compliance Discusses Her Department’s ‘Re-Brand’” (Jan. 24, 2018).

    Read Full Article …
  • From Vol. 7 No.12 (Jun. 13, 2018)

    When Every Employee Is a Keeper of the Company’s Culture: An Interview With WD‑40 Company’s Karla Pinckes

    A company’s culture is one of the most important elements of a successful compliance program, but how does a company teach something as ephemeral as culture? How does a compliance department move beyond seeing itself, and being seen as, the bribery police? The Anti-Corruption Report recently spoke with WD‑40 Company’s associate general counsel and assistant corporate secretary Karla Pinckes about her company’s approach to compliance and ethics messaging. By focusing on core values, she explained, the WD‑40 Company is able to empower all of its employees to take an active interest in the company’s wellbeing. The values focus also impacts how the company’s compliance and ethics department operates. Pinckes encourages her staff to see and promote themselves as culture keepers, an approach that is reaping dividends in close relationships with the business and company-wide support for compliance. See “Finding the Softer Side: VMware’s Senior Director of Ethics and Compliance Discusses Her Department’s ‘Re-Brand’” (Jan. 24, 2018).

    Read Full Article …
  • From Vol. 7 No.4 (Feb. 21, 2018)

    Measuring the ROI of Compliance

    Like other investments, those in compliance can be evaluated based on their return, Lynn Haaland, PepsiCo’s global chief compliance and ethics officer, argues in a guest article. Haaland reveals her strategies for measuring Pepsi’s compliance investments and details how compliance departments can use metrics to demonstrate that their budgets deserve company dollars. See The Anti-Corruption Report’s four-part series on measuring compliance: “Getting Started” (Aug. 2, 2017); “Seven Areas of Compliance to Measure” (Aug. 16, 2017); “How to Measure Quality” (Sep. 6, 2017); and “Gathering and Analyzing Data” (Sep. 20, 2017).

    Read Full Article …
  • From Vol. 6 No.24 (Dec. 13, 2017)

    How to Make the Most of Limited Compliance Resources

    In the face of ever-increasing regulatory demands, compliance departments may be asked to do more with less. A recent presentation by ACA Compliance Group, “Planning Your 2018 Compliance Budget,” offered timely insight on how CCOs and compliance personnel can approach the compliance-budgeting process, get buy-in from senior management, avoid common pitfalls and stretch limited resources. The program featured Lee Ann Wilson, an ACA senior principal consultant; Sean McKeveny, an ACA consultant; and Kara J. Brown, counsel at Sidley. See “Five Tools Every Chief Compliance Officer Needs for Effective FCPA Compliance: Title, Authority, Access, Budget and Culture (Part One of Two)” (Apr. 3, 2013); Part Two (Apr. 17, 2013).

    Read Full Article …
  • From Vol. 5 No.1 (Jan. 13, 2016)

    Creating Value in FCPA Investigations Through Increasing Cooperation Credit

    When payments to a third party with possible connections to the government are discovered in a high-risk market, what is a general counsel to do? This guest article, featuring a hypothetical narrative, tracks the trials and tribulations of a general counsel confronted with such an FCPA matter. Baker Donelson partner Joe Whitley and associate David Stewart provide specific advice about how a GC can successfully navigate an internal corruption investigation from the initial fact discovery to negotiating for sufficient resources to addressing collateral consequences. See Brockmeyer and Stokes Offer Four Benefits of Cooperation and Four Ways Companies Can Go Wrong in Their Internal Investigations” (Dec. 16, 2015).

    Read Full Article …
  • From Vol. 4 No.8 (Apr. 15, 2015)

    Consero Benchmarking Survey Offers CCO’s Insights on Budgets, Training, Strategy and Third-Party Management

    “Chief compliance officers seem pleased with the variety and sophistication of new resources available to support their efforts, but they are troubled by the speed at which the global economy is changing, and the increasing complexity of the compliance environment,” Paul Mandell, Founder and CEO of Consero Group, LLC told The FCPA Report, drawing on the findings from his firm’s 2015 Corporate Compliance & Ethics Data Survey.  In the Survey, developed in connection with Consero’s Fall 2014 Corporate Compliance and Ethics Forums in the U.S. and U.K., senior compliance executives offered information on their budgets, the effectiveness of their training, their confidence in their third-party management and other topics.  See also “Five Tools Every Chief Compliance Officer Needs for Effective FCPA Compliance: Title, Authority, Access, Budget and Culture (Part One of Two),” The FCPA Report, Vol. 2, No. 7 (Apr. 3, 2013); Part Two of Two, Vol. 2, No. 8 (Apr. 17, 2013). 

    Read Full Article …
  • From Vol. 3 No.24 (Dec. 3, 2014)

    Strategies for Justifying Compliance and Ethics Budgets

    Functions that do not directly impact the bottom line may be neglected when a corporation plans its budget.  Compliance and ethics in particular can be seen as a necessary evil, rather than as an integral part of a successful business.  A recent presentation at the 2014 Compliance & Ethics Institute, sponsored by the Society of Corporate Compliance and Ethics, explored how a compliance and ethics department can demonstrate its value to an organization and make it easier to secure sufficient funds to operate effectively.  The program featured Julie K. Moriarty, General Manager, Training and Communications Strategy, and Jimmy Lin, Vice President of Product & Corporate Development at governance, risk and compliance consulting firm The Network, Inc.  See also “CEB Analyzes Key Compliance and Ethics Data,” The FCPA Report, Vol. 3, No. 20 (Oct. 8, 2014).

    Read Full Article …
  • From Vol. 3 No.20 (Oct. 8, 2014)

    CEB Analyzes Key Compliance and Ethics Data

    The compliance function has increased in value and more departments are taking on responsibility for compliance.  Those were some of the preliminary findings from CEB's survey of 300 major companies, the State of the Compliance & Ethics Function.  The findings provide benchmarking information for multi-national companies and will help CEB shape its specialized compliance tools, Ronnie Kann, managing director of CEB’s legal, risk and compliance practice, told The FCPA Report.  He shared takeaways for compliance professionals from the survey.  See also “Anonymous Polling, Focus Groups and ‘Organizational Justice’ Help Companies Avoid FCPA Violations While Growing Revenue,” The FCPA Report, Vol. 1, No. 9 (Oct. 3, 2012).

    Read Full Article …
  • From Vol. 3 No.18 (Sep. 10, 2014)

    Compliance Experts from Altria, Noble Energy and HP Share Corruption Investigation Best Practices

    A recent American Bar Association program brought together compliance executives from several public corporations to discuss how to both satisfy the client and mollify the government during an anti-corruption investigation – no easy task.  The panelists, along with moderator Mara V.J. Senn, a partner at Arnold & Porter, shared insights and experiences on preparedness for internal investigations, the role of outside counsel, the calculus of voluntary disclosures and a number of other common issues faced by companies conducting internal investigations.  For more from Senn on internal investigations, see “How to Conduct an Anti-Corruption Investigation: Ten Factors to Consider at the Outset (Part One of Two),” The FCPA Report, Vol. 2, No. 25 (Dec. 18, 2013); and “Developing and Implementing the Investigation Plan (Part Two of Two),” The FCPA Report, Vol. 3, No. 1 (Jan. 8, 2014).  

    Read Full Article …
  • From Vol. 2 No.16 (Aug. 7, 2013)

    Estimating Loss: When and How to Calculate and Disclose Financial Reserves for FCPA Settlements (Compendium of SEC Filings)

    When a public company is negotiating an FCPA settlement with the government, it must consider its concurrent obligation to set and publicly disclose a financial reserve for that settlement.  This raises various issues.  How early should a company set a reserve?  When should the company disclose that reserve?  What language should the disclosure include?  The FCPA Report has published a three-part series (see part onepart two and part three) addressing crucial issues companies face when considering whether and how to compute and disclose financial reserves for FCPA settlements.  With help from Intelligize’s database and search tools, The FCPA Report has also organized this long-form compendium of actual FCPA reserve-related disclosures from recent SEC filings to complement the series.  The disclosures are grouped based on when in the investigation the company established a reserve, as follows: (1) Reserve Disclosure Made During Early Discussions with the Government; (2) Reserve Disclosures Made During the Course of the Government Investigation; and (3) Reserve Disclosures Made on the Eve of Settlement.  These real-world examples of relevant disclosures can serve as precedents for counsel tasked with drafting or reviewing SEC filings when a company is considering setting a reserve in anticipation of an FCPA settlement.  To maximize the value of this compendium as a practice tool, this compendium also contains links to each of the filings discussed and quoted.

    Read Full Article …
  • From Vol. 2 No.15 (Jul. 24, 2013)

    Estimating Loss: When and How to Calculate and Disclose Financial Reserves for FCPA Settlements (Part Three of Three)

    When a company is involved in FCPA settlement negotiations with the government, it must consider whether those negotiations are likely to lead to a probable and estimable financial loss.  If so, the company may be required to reserve funds for the potential settlement and disclose its reserve in SEC filings.  When is setting a reserve appropriate?  How should that reserve be calculated?  When is disclosure of the reserve necessary?  This article is the third in a multi-part series addressing these and related crucial issues.  In particular, this article discusses how to calculate a reserve and how to craft the disclosures accompanying the setting of a reserve.  The first installment in the series discussed the accounting principles governing the setting of the reserve, examined when during an investigation a company should set a reserve and described who should be involved in setting the reserve.  The second article in the series discussed the issues a company should consider before setting a reserve, the risks related to setting reserves and the risks of miscalculating the reserve.  The final installment in the series will be a compendium of actual FCPA reserve-related disclosures from recent SEC filings compiled with help from Intelligize’s database and search tools.

    Read Full Article …
  • From Vol. 2 No.15 (Jul. 24, 2013)

    How to Demonstrate the Business Value of Anti-Corruption Compliance and Create Management Buy-In

    One of the major challenges faced by in-house compliance personnel and compliance advisors is how to encourage management to buy into the company compliance program – before the company gets into trouble.  Many compliance officers report that they struggle with convincing their colleagues and business partners that anti-corruption compliance is not only necessary for the company to avoid liability, but can also benefit the bottom line.  At a recent conference hosted by the American Conference Institute, Jim Portnoy, Chief Counsel, Corporate and Government Affairs at Kraft Foods, and Stephen Fishbein, partner at Shearman & Sterling LLP, shared their insights on how to get and keep management interested and engaged in anti-corruption compliance.  See also  “Five Tools Every Chief Compliance Officer Needs for Effective FCPA Compliance: Title, Authority, Access, Budget and Culture (Part Two of Two),” The FCPA Report, Vol. 2, No. 8 (Apr. 17, 2013).

    Read Full Article …
  • From Vol. 2 No.14 (Jul. 10, 2013)

    Estimating Loss: When and How to Calculate and Disclose Financial Reserves for FCPA Settlements (Part Two of Three)

    When a publicly traded company is negotiating an FCPA settlement, it must consider reserving funds for the associated loss.  Calculating a reserve becomes necessary when the company faces a probable, estimable and material loss.  Once that occurs, the company will likely be required to make a public disclosure about the reserve, exposing it to a host of potentially adverse consequences, including harm to the company’s reputation, a decrease in stock price and increased exposure to foreign prosecutions.  How should a company involved in settlement negotiations with the government address this sensitive issue?  How should it go about setting such a reserve?  When during those negotiations should the company begin to consider reserving funds for a future settlement?  How should the reserve be calculated?  How should it be disclosed?  The FCPA Report is publishing a multi-part series addressing these crucial issues.  This article, the second in the series, discusses the issues a company should consider before setting a reserve, the risks related to setting reserves and the risks of miscalculating the reserve.  The first installment in the series discussed the accounting principles governing the setting of the reserve, examined when during an investigation a company should set a reserve and described who should be involved in setting the reserve.  See “Estimating Loss: When and How to Calculate and Disclose Financial Reserves for FCPA Settlements (Part One of Three),” The FCPA Report, Vol. 2, No. 13 (Jun. 26, 2013).  The third and final installment will discuss how to calculate a reserve and how to draft the disclosures announcing the reserve.  It will also include a compendium of actual FCPA reserve-related disclosures from recent SEC filings, compiled with help from Intelligize’s database and search tools.

    Read Full Article …
  • From Vol. 2 No.10 (May 15, 2013)

    Insight from Top Companies and Practitioners on How They Are Addressing Current Anti-Corruption Issues, from Self-Reporting to Risk Assessments to Training

    The government has made it clear that complying with the FCPA does not, and should not, require companies to adopt a one-size-fits-all solution.  Each company must tailor its program to its unique business model.  Despite the individuality of each program, however, it is useful for a company and its advisors to understand how the company’s peers and competitors are ensuring FCPA compliance.  How much are companies spending on anti-corruption compliance?  What type of training program does each company find effective?  What percentage of companies invest in risk assessments?  A recent panel hosted by the Practising Law Institute provided answers to these questions and more.  Combining commentary from industry experts Mark Mendelsohn, partner at Paul, Weiss, Rifkind, Wharton & Garrison LLP, Alexandra Wrage, president of TRACE International, Inc., Raja Chatterjee, Global Head of the Anti-Corruption Group at Morgan Stanley, and Susan Ringler, Deputy General Counsel for Xylem Inc., as well as interactive audience polling of conference participants (including in-house counsel, outside counsel and compliance personnel), the panel provided unique insight into trends and patterns in the FCPA world.  The panel analyzed the difficult issues that arise when developing training programs, allocating anti-corruption compliance resources, conducting risk assessments, executing internal investigations and making voluntary disclosures.  See “Five Tools Every Chief Compliance Officer Needs for Effective FCPA Compliance: Title, Authority, Access, Budget and Culture (Part One of Two),” The FCPA Report, Vol. 2, No. 7 (Apr. 3, 2013).  See also The FCPA Report’s FCPA Training That Works series: Navigant’s Joseph Spinelli (Apr. 3, 2013); Weatherford’s Billy Jacobson (Apr. 17, 2013); Manatt Phelps & Phillips’ Jacqueline C. Wolff (May 1, 2013).

    Read Full Article …
  • From Vol. 2 No.8 (Apr. 17, 2013)

    Five Tools Every Chief Compliance Officer Needs for Effective FCPA Compliance: Title, Authority, Access, Budget and Culture (Part Two of Two)

    A highly qualified chief compliance officer (CCO) is necessary but not sufficient to implement and enforce a best-in-class FCPA compliance program.  In addition to being inherently capable, that CCO also must be empowered.  Even the best CCOs need certain tools to perform effectively in an FCPA compliance role; absent such tools, the work of otherwise effective CCOs can be dangerously undermined.  Unfortunately, studies have consistently shown that when it comes to FCPA compliance, CCOs feel under-resourced, overworked and not as impactful as they can and should be.  How can companies bridge the divide between their FCPA compliance aspirations and the reality of insufficiently empowered CCOs?  This is the second article in a two-part series designed to address this fundamental question.  Fortunately for companies, the most productive answer does not involve throwing more money at the problem, but rather rethinking the solution.  In particular, through a series of conversations with high-level sources with direct experience on this challenging topic, we have identified five essential tools that a CCO needs to do effective FCPA compliance.  Those tools include an appropriate title and actual authority, direct access to the board and management, sufficient budget and resources, a bona fide culture of compliance and an incentive structure that reinforces the culture.  The first article in this series addressed the first three tools – see “Five Tools Every Chief Compliance Officer Needs for Effective FCPA Compliance: Title, Authority, Access, Budget and Culture (Part One of Two),” The FCPA Report, Vol. 2, No. 7 (Apr. 3, 2013) – and this article addresses the last two.  Notably, this article gives content and structure to the elusive but all-important concept of a culture of compliance.

    Read Full Article …
  • From Vol. 2 No.7 (Apr. 3, 2013)

    Five Tools Every Chief Compliance Officer Needs for Effective FCPA Compliance: Title, Authority, Access, Budget and Culture (Part One of Two)

    Hiring an outstanding chief compliance officer (CCO) is necessary but not sufficient for effective FCPA compliance.  To be effective, the right CCO needs the right tools – actual authority credibly conveyed by an appropriate title; access to the board and management; a workable reporting structure; sufficient budget; quality people; up-to-date technology; and a receptive culture.  Few companies would dispute the notion that a CCO needs the foregoing tools, among others, to do his or her job well.  But fewer still have a coherent and consistent approach to translating these concepts into practice.  How, for example, can a company structure reporting lines to maximize the effectiveness of its CCO and minimize the likelihood of FCPA violations?  What level of board access is appropriate for the CCO, and how can a company facilitate such access?  This article addresses these and similar questions.  In doing so, this article aims to help companies empower their CCOs and thereby minimize the probability and magnitude of FCPA and other compliance violations.  Many of the recommendations in this article do not involve increased spending, but rather a more prudent allocation of resources, better informed structuring and refocused culture.  More effective FCPA compliance is not just about spending more money; it’s about thinking differently, confronting reality and giving the right people the right tools.

    Read Full Article …
  • From Vol. 2 No.6 (Mar. 20, 2013)

    How to Find a Business-Minded Compliance Monitor and Minimize Reporting Requirements When Negotiating an FCPA Settlement (Part Three of Three)

    Resolving a government FCPA investigation is a costly proposition; if a company is required to retain a monitor, the costs skyrocket.  Companies can limit the burden of monitorship, however, by carefully vetting their monitor candidates and choosing a monitor that is business-minded, pragmatic and efficient.  This article details the specific characteristics a company should look for when choosing a monitor and discusses strategies for limiting the costs of monitorship.  The first article in this three-part series examined precedent, practice and trends in post-settlement FCPA reporting obligations; discussed the shift to less traditional forms of reporting; explained the process by which reporting obligations are created; and described the mechanics of the most intrusive types of reporting – traditional monitorship and self-reporting.  See “How to Find a Business-Minded Compliance Monitor and Minimize Reporting Requirements When Negotiating an FCPA Settlement (Part One of Three),” The FCPA Report, Vol. 2, No. 4 (Feb. 20, 2013).  The second article in this series provided real-world examples of innovative reporting requirements and outlined strategies for negotiating the most beneficial reporting requirements possible.  See “How to Find a Business-Minded Compliance Monitor and Minimize Reporting Requirements When Negotiating an FCPA Settlement (Part Two of Three),” The FCPA Report, Vol. 2, No. 5 (Mar. 6, 2013).

    Read Full Article …
  • From Vol. 2 No.1 (Jan. 9, 2013)

    Consero Survey Offers Benchmarking Data on Chief Compliance Officer Compensation, Budgets and Access to Top Management

    Consero Group LLC (Consero) recently conducted a survey of chief compliance officers (CCOs) of major corporations.  The survey provides data on compliance departments with respect to department size, access to top management, budgets and compensation.  Consero conducted the survey at its October 2012 Corporate Compliance and Ethics Forum, held in Palm Beach Gardens.  Forty-eight of the Forum’s attendees – all CCOs of Fortune 1,000 companies – responded to the questions.  See also “Top General Counsel Compensation Increasing Amidst Growing Pressure on In-House Law Departments,” The FCPA Report, Vol. 1, No. 14 (Dec. 12, 2012).

    Read Full Article …