Is Corporate Compliance Deceitful?

My friend and colleague Miriam Baer, an expert on corporate compliance and criminal law, thinks that it is – and that we should be more skeptical of compliance (a favorite buzzword post-Enron and post-meltdown). The clash between transparency and compliance is a troubling one that I hadn’t thought about before; Miriam’s paper is an important marker in that debate.

One Response to “Is Corporate Compliance Deceitful?”

  1. “Corporate compliance” is not deceitful. Compliance is simply the application of management techniques to prevent and detect misconduct. It is probable that professor Baer’s own institution does this, at least to address such issues as discrimination, safety of university workers, and cheating by faculty on government contracts. In reality, there is simply no other way to prevent misconduct in organizations than by the use of management techniques; everything else is just wishful thinking. But the issue is how the compliance effort is done. Too often the programs rely on paper and preaching, are underpowered and are mis-positioned in the legal department. (Note, by the way, that the FBI has been instituting one, and the SEC has recently announced plans to have one.) Like any management effort, they can be effective, but it takes a serious commitment by upper management and the board, a fully empowered and independent chief ethics and compliance officer, and more active promotion and careful scrutiny by government. Only when the government makes it crystal clear that truly effective programs matter does industry (including academia) respond. Cheers, Joe Murphy