Regulatory Expectations and Guidance

Welcome back to the LRN [in principle] newsletter.?

If you would like to learn more about LRN, our work, team and technology platform, feel free to join us here.

As promised, we won’t top-off anyone’s inbox ?? more than once a month and we do have some exciting news in this edition ?

Regulatory Expectations and Guidance

In September 2024,? the United States Department of Justice (DoJ) updated its “Evaluation of Corporate Compliance Programs” (here). Among a multitude of issues, the DoJ guidance continues to emphasize the importance of third-party monitoring and vetting, as well as the significance of “integrating policies and procedures” while rolling them out “in a way that ensures employees’ understanding of the policies.” Reflecting on the guidance, in this article, LRN addresses “The importance of supply chain due diligence, training, and operational resilience: Lessons from the CrowdStrike outage.”

Coupled with the 2023 UK Economic Crime and Corporate Transparency Act (ECCTA), there has never been more regulatory pressure on organizations to have “adequate procedures” to both prevent and detect fraud and misconduct. Layering both of these developments, LRN published this article on the impact that both of these regulatory expectations have on corporate compliance and ethics programs.??

General Counsel Conference East

?? LRN was proud to sponsor ALM ’s General Counsel Conference East, held on November 18-19 at the Marriott Marquis in New York City ??!?

LRN’s Chief Advisory Officer Ty Francis MBE, CCEP introduced the opening keynote, featuring LRN consultant Richard Bistrong and Obi M. , SVP, and Chief Ethics and Compliance Officer, Visa , as moderated by Heather Nevitt , Editor and Chief, ALM . The keynote was titled “Becoming a Trusted Business Partner: Navigating Compliance and Ethics Challenges,” and included thought-provoking, real-time questions from attendees.?

Audience questions included:?

???? As a CECO, do you see any distinction between the business perspective of a compliance officer and the business lawyer embedded in business functions??

???? Are there risks in the Chief Compliance Officer reporting to the Audit Committee of the Board instead of the GC or CEO? While the DoJ guidance does not offer reporting lines, it does have a lot to say on this issue.

???? What are common tools you’ve found successful to engage the business to view compliance as a positive when it can often be viewed as a blocker? There was a lot of discussion on this topic and we welcome your views below ??

???? How would you advise the CEO when an allegation of poor ethical judgment (but not clear illegality) is substantiated against a “star” or key revenue generator??

We had a robust discussion on these “lawful but awful” issues when it comes to high performers. For more on this issue, feel free to reference Richard’s co-authored article with Ron Carucci and Dina Denham Smith in Fast Company , on “Why high performers are more subject to ethical risk.”?

???? There was more than one question about the importance of middle-level managers, and as Obi shared, if we are not careful it can become the “messy middle.” And for more on the messy and frozen middle, feel free to join us for this article on how to unfreeze your code ??

While many of these questions differed in terms of the organizational focus, as Obi well shared, there is no substitute for “organizational allies” when it comes to increasing E&C respect and partnering with the business.

During day two of the Conference, LRN’s Director of Advisory Services, Eric Morehead moderated a panel on "Navigating DOJ Enforcements: Compliance and Best Practices"?with Michael R. Clarke, JD, CCEP, NACD.DC? , VP, Deputy General Counsel & Chief Compliance Officer Convatec and Xavier A. Cunningham , Supervisory Attorney Advisor,?Department of Justice.

Key discussion topics included:?

?? A discussion on how the DOJ approaches FCPA cases from a risk assessment perspective.?

?? What the latest changes? to the DoJ’s “Evaluation of Corporate Compliance Programs” means in terms of the proportionality of compliance resources deployed to address the risk profiles of an organization (internally and externally).?

Audience questions included:?

???? How does the DoJ define “high risk” when evaluating potential FCPA? cases??

???? How should organizations think about “high risk” related to third party vendors?

???? How many layers? should you go with respect to? diligence on third parties, intermediaries, and channel partners - first, second, third and/or beyond??

???? Given the DoJ’s recent use of clawbacks, has that influenced compensation structures at organizations?? ??

And as an added “must read” bonus ??, Xavier recommended: The Looting Machine: Warlords, Oligarchs, Corporations, Smugglers, and the Theft of Africa’s Wealth, by Tom Burgis .

After day one,? LRN hosted another one of its “no agenda” dinners ???? including (l-r): LRN Chief Revenue Officer Lenny Izzo , Greg Higgins , LRN Chief Advisory Officer Ty Francis MBE, CCEP , LRN VP of Enterprise Sales, Scott Pierce , Tricia Fratto , Richard Bistrong , LRN Chief Marketing Officer Amy Hanan , Patricia Wheeler , Lourdes Maldonado , Michael R. Clarke, JD, CCEP, NACD.DC? , Denis Jacob , Alison Hinds-Pearl , and Brian Merrill . It was a wonderful evening of networking and sharing perspectives.

The American Lawyer Industry Awards

LRN proudly sponsored the Compliance Department of the Year award at the American Lawyer Industry Awards 2024. Amy Hanan, Scott Pierce, and Mark Dorosz represented LRN at the event, celebrating excellence and leadership in the legal industry.

A special highlight of the evening was Amy’s presenting the Compliance Department of the Year award ?? to the well-earned winner, Datasite ! Congratulations to Datasite and to all of this year's nominees: AGS Health, Docusign, General Motors, GSK, and Sedgwick.

It was an inspiring evening, and we’re honored to celebrate and support those driving meaningful change in the legal and compliance fields. ???

Regulation Asia Awards for Excellence

LRN was honored to be recognized by Regulation Asia?(Best Compliance Training Provider,? 2024)? for our commitment to advancing ethics and compliance through innovative training solutions! ?? Thank you to the Regulation Asia Awards Team for celebrating our work and to our clients for trusting us to support their compliance journeys.?

Together, we’re making a real impact in fostering principled performance and helping organizations do the right thing across the APAC region and beyond. ??

?? This award recognizes Catalyst, LRN’s core SaaS application, a platform built for the design, deployment, measurement, analysis, management, and optimization of Ethics & Compliance programs. The platform features a library of over 500 learning assets across 79+ languages, enabling organizations to deliver targeted ethics and compliance training.

Accepting the award on behalf of LRN is Erica Britton-Johnson , Director of Sales, APAC.

Well, that is all for now, and wishing everyone all the best. Thank you for reading this? edition of the [in principle] newsletter ??.. Here are some? additional ways to access further perspectives, tips, and resources:

★ Follow LRN on LinkedIn here to join the conversation on posts and feel free to share the newsletter for others who might find it interesting by forwarding this link.

★ Follow LRN on YouTube here to check out our latest videos on ethics and compliance topics.

★ To stay up-to-date on our Principled Podcast series ??, which can be streamed wherever you listen to content, feel free to join us here.??

★ And always feel free to reach out to us directly, including suggestions for our next newsletter here.