The current global pandemic poses a threat to professional and personal lives, and it will challenge compliance culture. It may divert focus, impede oversight, promote profit over good business practice, and result in red flags ignored. This is the optimal climate for corruption. And now is when companies find out if their compliance programs will withstand the challenges this crisis poses. Later is when regulators may decide their programs did not.
The COVID-19 pandemic is precisely the circumstance where top-down commitment to anti-corruption compliance matters. That commitment is being and will be tested. As the U.S. Department of Justice put it, “[t]he effectiveness of a compliance program requires a high-level commitment by company leadership to implement a culture of compliance from the top.” In assessing whether and to what extent to charge criminal conduct, prosecutors are told to “examine the extent to which senior management have clearly articulated the company’s ethical standards, convey and disseminated them in clear and unambiguous terms, and demonstrated rigorous adherence by example.” It is therefore of critical importance that, in the midst of this pandemic, senior management coordinate with compliance personnel to affirm that all implemented compliance controls remain in place and are followed, and to identify potential gaps resulting from the pressures of this crisis.
COVID-19 also underscores the importance of anti-corruption training. The pressure to more quickly meet demand, complete a construction project, or obtain government approvals is mounting. At the same time, because of travel and social restrictions, the ability to have on-site oversight over these activities is diminishing. Companies are therefore relying on their personnel to make the right decisions in this precarious corruption climate. And to be confident in that reliance, companies need to have confidence in their employees’ ability to recognize problematic conduct and to respond to and report it according to company compliance protocols. When making charging decisions, DOJ prosecutors are told to “examine whether the compliance program is being disseminated to, and understood by, employees in practice in order to decide whether the compliance program is truly effective.” Companies thus must continue their efforts to educate their employees on the corruption risks unique to their businesses. While that already should have been a priority before COVID-19, its importance is paramount now.
Whether and to what extent COVID-19 becomes cover for corrupt practices remains to be seen. The virus’s global spread is distracting and destabilizing, and creates the type of conditions where misconduct can thrive. Companies will be best served through this trying time by protecting the well-being of their compliance policies and procedures.
- U.S. Department of Justice, Criminal Division, Evaluation of Corporate Compliance Programs at 9 (April 2019). [Back to reference]
- Id. [Back to reference]
- Id. at 5. [Back to reference]