Establishing and Maintaining an Ethical Corporate Culture

In-house corporate compliance programs have recently undergone a positive transformation, including the growth of strong and independent compliance functions. But as I argue in a recent New York Law Journal article, to remain successful and scandal-free in this era of corporate wrongdoing, organizations must be more forward-looking and establish a culture of integrity that deters misconduct from occurring in the first place. Indeed, most of the organizations that were the subject of major scandals over the last decade had well-funded compliance programs, yet the fraud went on. Now with the establishment of the Securities and Exchange Commission’s (SEC) new whistleblower program, enacted as part of Dodd-Frank, the need for such a strong ethical platform has never been more critical. In this new program, the federal government has essentially deputized virtually every company employee to serve as their foot soldiers in the fight against fraud and corruption. Legal and compliance officers have new and compelling arguments for increased resources and support in establishing strong ethical cultures and state-of-the-art compliance programs.

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