原文始发于微信公众号（瑞中法协）：Compliance:Esuring a safe haven for business
There’s an old saying: smooth seas never made a good sailor. The past months have undoubtedlybrought one of the biggest global challenges our generation ever faced. In thecorporate context, going from an environment that was almost one hundrerpercent face-to-face to one hundrer percent virtual threw employees and senior managementin deep waters. Crucially, we need to understand how these changes haveaffected the companies’ compliance environment.
New Compliance Risks
Duringthe pandemic, companies need all hands on deck to reassess new risks they faceand measure the impact of changes to regulations. For example, Brazil’s federalpublic administration temporarily relaxed the rules on the acquisition of goodsto fight Covid-19. Federal Law No. 13,979/2020 waived the bidding requirementfor procurement of health goods, services and supplies for coping with theemergency. This increased the risk of fraud in public procurement. Another law – Federal Decree No. 9,764/2019 – on theacceptance of donations by the Brazilian Federal Public Administration createdsituations that might potentially invite corruption.
However,companies that empowered their compliance departments and honored theircompliance program during the pandemic managed to make substantial donations tothe public administration. These companies were able to successfully contributeto fighting the novel coronavirus at a crucial time.
Thepandemic forced companies to trim their sails and adopt to working from home. Compliancedepartments had to while continuing to manage their compliance program.
Thismigration to a remote environment alone brought several challenges for companiesused to performing its internal controls on paper. Especially if they preiouslyreliedon staff working in close proximity to each other and keeping records in hardcopies at the company’s headquarters.
Withoutan integrated system for a given compliance procedure raises the risk of losingrelevant information in emails, messages, and calls. If there are no automatedcommands compliance programs also lose efficiencywill also be put at risk as internal flows risk jamming. .
Companyused to communicate their compliance program through offices, plants and facilities needed toredesign its means of keeping employees informed. Many companies migrated eventsand training sessions to a virtual environment, which required even morecreativity to maintain the audience’s attention.
Ithas been essential to make clear that company rules would not change despite ahome-working environment. It was us to top management and compliance departmentsto send a loud and clear message that the pandemic’s impact on business did notjustify ethical breaches.
Suchmeasures intended to prevent employees from feeling pressured to act wrongfullyfor the sake of productivity. While working form home it is vital to ensure thatemployees refrain from defrauding the company’s accounting or conspiring withcompetitors. Companies also emphasised that offering undue advantages to publicofficials. suppliers or customers to secure contracts, sales or prices is alsoforbidden.
Cybersecurityis another critical area. The risks of internal fraud, cyberattacks and dataleaks have increased. The sudden migration to virtual work environments hascreated opportunities for malicious people to exploit weaknesses in companies’ systems.
Companieshave reinforced their policies on the topic to remind employees of the bestpractices for circulating internal documents and information under the correctlevel of confidentiality. Moreover, employees have had to reaffirm their duty notto share competitively sensitive information or secrets while working fromhome.
InBrazil, during the pandemic, the volume of ethics-related complaints receivedby businesses increased by thirty percent. About half were related to the labourissues and questions regarding the end of working from home.
Thedata signal that a well-designed and implemented integrity mechanism favorsemployees helping the company to curb misconduct and indicates the investmentsin prevention paid off. It also shows that social distancing has not diminishedpeople’s confidence in the company’s ability to investigate complaints. Investigationscould not stop and leave the whistleblower high and dry. It was up to compliancedepartments to adjust the protocols for collecting data and conductinginterviews to do it remotely and online.
Docking in a Safe Harbor
Thepandemic is a real stress test for compliance programs and their responsecapacity. It has been a sink or swim situation. If a year ago, there weredoubts about the relevance of a well-structured compliance department for thesurvival of companies in an increasingly unpredictable market, no-one can denytheir importance today. If six months ago, companies questioned whether the complianceprogram would be up to the challenges; today the answer is self-evident.
Thecompanies that, even before the crisis, gradually invested in their compliance programs-qualifying their teams, structuring integrated and automated systems andpromoting their – values were more prepared to face new challenges. In fact, companieswith an internal ethical culture wereable to act as lighthouses to guide employees on what to do during hardship.
Eachcrisis that rocks the boat brings an opportunity, and the pandemic certainly wasa big lesson to everyone. The way companies acted during the pandemic will beevaluated by shareholders, authorities, and stakeholders. Irregularities,during the crisis, in addition to the inevitable and unwanted legalconsequences, will result in reputational damage to the companies and businesspartners.
Itwas also an excellent opportunity for to compliance departments to showemployees that they support them and to demonstrate to senior management howstrategic they are for the company’s future.