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With increasing personal risk, management need to ensure that compliance officers have the resources they need

Blogs October 12, 2016



It is well established that a basic requirement for an effective compliance program is proper commitment from management and resources necessary to achieve its goals. Despite this, however, securing the proper resources is often one of the more challenging aspects of a compliance officers’ job. All too often, even when a company recognizes the need to address compliance concerns, it underestimates both the amount of risk it faces and the amount of resources required to implement an effective program.

In far too many cases, adequate resourcing only comes after a major compliance failure. Until then, compliance risk is often seen as somewhat theoretical. In such cases, compliance officers may determine that a big part of their job is to educate management on compliance, and slowly build up the program and resourcing over time. However, based on a recent study, compliance officers' willingness to continue engaging in such behavior may be coming to an end. With the ever increasing threat of being held personally accountable for corporate misconduct, compliance officers are likely to demand a much higher level of commitment from top management in order to stay on the job.

Recent surveys conducted by both Thomson Reuters and DLA Piper seem to support this change in attitude. According to DLA Piper's 2016 Compliance & Risk Report: CCOs Under Scrutiny , 81% of in house counsels and compliance officers surveyed were concerned about personal liability, and 65% of them felt that the increased liability might affect their willingness to stay in the role of a chief compliance officer or toaccept such a role in the future.

These findings seem to indicate, that if companies are not careful, they run the risk of losing their compliance champions. If they are not willing to make an adequate commitment to resources up front, good compliance officers may decide that the risk is simply not worth it.