The Big Picture

"The Big Picture" is written by Matt Kelly, editor & publisher of Compliance Week. Kelly blogs about the broader context of regulatory developments, legislative actions in Washington, and other events in the area of compliance and corporate governance. Questions, comments and statements from readers are always welcome, and where appropriate Kelly will try to address them in his blog. He can be reached via email at mkelly@complianceweek.com.

The Book About Corruption You Should Read Immediately

February 21, 2012

"Behind the Beautiful Forevers," by Katherine Boo, depicts the everyday world in Annawadi, a slum in Mumbai, and the petty corruption that overrun the lives of the people who live there. Ethics and compliance officers who want a clear, gripping reminder of the challenges that face a globalized workforce can do no better, Compliance Week Editor Matt Kelly writes.
 

Whistleblowing 101 in Latin America

February 14, 2012

If you're looking for an example of cultural differences in ethics and compliance to share with your board, visit the FCPA Compliance Group on LinkedIn. A recent discussion thread there talks about training Latin American employees, and has this gem: the Spanish language has no word for "whistleblower."
 

Stalling Out on Dodd-Frank

February 13, 2012

Disenchantment with the Dodd-Frank Act seems to be in the air these days. Last week CW Editor Matt Kelly wrote about executives in the energy sector grumbling over Dodd-Frank compliance. This week the banking sector gets its turn—and given the slow pace of rulemaking, no wonder compliance officers are at a loss about what to do next, he says.
 

Sapping the Energy From Dodd-Frank Compliance

February 06, 2012

Last week Compliance Week and Deloitte co-hosted a discussion about compliance with the Dodd-Frank Act, specifically as it pertains to the oil & gas industry. Inside, Editor Matt Kelly shares some of the participants' observations, since regardless of industry, Dodd-Frank is quickly coming to embody all the practical challenges of modern compliance that drive you crazy.
 

Compliance Week 2012: More News, More Speaking Opportunities!

January 27, 2012

Compliance Week is already well underway in planning the agenda for our 2012 annual conference, but as always, our event will cover a huge range of topics—which means we have several slots in our program where we're still looking for in-house compliance, risk, or audit executives who might be willing to speak at our event. Editor Matt Kelly has the details, including an early preview of the agenda.
 

Why Nobody Likes Corporate America

January 23, 2012

Newt Gingrich clobbered Mitt Romney in the South Carolina primary on Saturday because he exploited the latest tension in public life: Corporate America versus the Rest of America. Is that middle-class resentment legitimate? Perhaps not, Compliance Week editor Matt Kelly writes—but jeez, when you look at some governance decisions in business today, maybe Corporate America is asking for it after all.
 

Another Victory for the Surge Strategy

January 20, 2012

Compliance Week would not normally pay much attention to SOPA and PIPA, those two cutely named bills in Congress intended to fight Internet piracy, which had seemed destined for passage until users of the Internet revolted against the measures earlier this week. But how critics took down SOPA and PIPA—by a mighty display of force amassed through social media—bears careful watching.
 

Compliance and Compensation Collide Again

January 08, 2012

Executive compensation has suddenly streaked back onto the agenda for ethics and compliance officers, what with ISS announcing new evaluation policies for executive pay and Verizon needing to restate the pay package for its departing CEO. That all leads back to how CCOs can weave ethics incentives into compensation; this week, Compliance Week Editor Matt Kelly looks at some interesting arguments on how to get that done.
 

Coming in Compliance in 2012

December 30, 2011

Compliance Week Editor Matt Kelly took the slow pace of last week to contemplate the most significant events likely to happen in 2012 that will affect your job as chief compliance officer—from FCPA to frameworks, recession to regulation, and all points in between. Inside are the 10 major news events he'll be waiting to see this year. Clue: changes in leadership in Washington are not among them.
 

MF Global: We're Back to Auditing Strategic Risks

December 19, 2011

All the gory details of MF Global's missteps were laid out before Congress last week amid several public hearings. Poor tone at the top, marginalized risk officers, sketchy corporate accounting, weak internal controls—it was all there. But at the bottom, Compliance Week Editor Matt Kelly writes, was one persistent problem for all risk, audit, and compliance executives: how to handle the delicate matter of strategic risks. His views are inside.
 

Compliance Lessons Learned Hard Way From EU Crisis

December 12, 2011

The European Union's latest efforts to forestall collapse may or may not work, but they do offer lessons on what motivates large groups of people to behave in certain ways. Inside, Editor Matt Kelly—just back from two weeks in close quarters with Europeans—has more on what compliance officers can learn.
 

The Lesson of MF Global

November 21, 2011

The 19th century British scientist Thomas Huxley once famously said, "Many a beautiful theory has been killed by one ugly fact." Those words were true when he uttered them in the 1860s, and they are equally true today as Washington debates the merits of the Sarbanes-Oxley Act—and we have MF Global to thank for it. Compliance Week Editor Matt Kelly has more inside.
 

Condorsement Picks Up Steam

November 14, 2011

The rest of the world may be coming apart at the seams, but rest easy: U.S. and global accounting standards continue their march toward convergence. That march is going by the name of "condorsement," but a march it is, and it seems better than any other idea out there to get the United States to use global accounting standards. Compliance Week Editor Matt Kelly has more.
 

Dispatches from Life Sciences Sector

November 07, 2011

Compliance Week tries not to dwell on sector-specific compliance concerns too often; broad challenges that apply to many industries keep us busy enough. Last month, however, we convened a teleconference of compliance executives in the life sciences sector to jawbone about the latest headaches in their corner of the world, and the lessons learned there bear repeating. Editor Matt Kelly has more inside.
 

Role of the Chief Audit Executive in the Future

October 31, 2011

Where goes the internal audit department in the future? Towards a more risk-centric approach to auditing; so says everyone who thinks about these things. But that world might shift the chief audit executive more into the role of a strategic adviser about risk, and not all CAEs may be comfortable with that line of work. Compliance Week editor Matt Kelly provides more of his thoughts inside.
 

Dispatches From the Front Lines of Compliance

October 17, 2011

Planning for our Compliance Week 2012 conference is now underway, which means Editor Matt Kelly is spending lots of time talking with compliance executives, listening to the problems they have and the solutions they've found. This week he shares a few dispatches from the front: compliance officers in dire need of practical advice, global knowledge—and for Pete's sake, does anyone know how to keep ethics instruction fun?
 

Automated Shareholder Activism

October 10, 2011

Meet your new shareholder: an automated computer program, trading shares of your company all day long. What does that mean for corporate conduct and the compliance departments that encourage it? Nothing good, Compliance Week Editor Matt Kelly writes. High-frequency trading is a potent new force in capital markets that could pose dire threats to compliance; onerous new regulations are just one of them. More inside.
 

Congress Missing the Point, Yet Again

October 03, 2011

Another week, another attempt from Washington to impose a simple solution to our economy's complex problems—and as usual, the Sarbanes-Oxley Act is right in the middle of things. So says Compliance Week Editor Matt Kelly, who warns that Washington's knee-jerk anti-regulatory reflex won't solve much. Also inside: fresh rumors about COSO's updated internal control framework, which may soon see the light of day.
 

Imposing a Duty to Report, Part II

September 26, 2011

Last week, Compliance Week Editor Matt Kelly weighed the wisdom of requiring employees to report instances of misconduct. Since then, one of the best sources of advice out there—Compliance Week subscribers—sounded off with powerful arguments why a duty to report is not only wise, but vital. Also inside this week: the latest sad spectacle of the SEC and its internal ethics processes.
 

Frustrations Rise on Whistleblower Hotlines

September 19, 2011

The Society of Corporate Compliance & Ethics held its annual conference in Las Vegas last week and, to little surprise, whistleblower hotlines—and all the frustrations they bring along—were a primary topic of discussion. Inside, Compliance Week Editor Matt Kelly sketches out the concerns he heard, which increasingly leave compliance departments in an untenable position.
 

Managing the Contagion of Risk

September 12, 2011

Losing sleep over the risk of erroneous financial reporting? Paranoid about the risk of disruption in your supply chain? Perhaps you should be. The more complex your corporation grows, the more risks it assumes; one might even say those risks spread like a virus. And after seeing "Contagion" this weekend, Compliance Week Editor Matt Kelly says paranoia about risk management might not be a bad idea.
 

The PCAOB's Big Debate

September 06, 2011

Now that we're all settling back into the office, members of the compliance community have any number of serious issues looming in front of them this month. To Compliance Week Editor Matt Kelly's thinking, however, few have as much potential to change the compliance function's day-to-day workings as the Public Company Accounting Oversight Board's ambitions to reshape how the auditing industry works.
 

The Risks of Poor Risk Management

August 29, 2011

A new gust of anti-regulatory sentiment is blowing through the halls of Washington these days. Out in the real world, meanwhile, Hurricane Irene left Compliance Week Editor Matt Kelly stranded in the foreclosure capital of the country: central California. Lawmakers in Congress, he writes this week, would do well to see the effects of poor regulation out there.
 

The Future of Articles on Internal Audit

August 22, 2011

Last week Compliance Week published an article on the gap between the skills internal auditors will need to do their jobs in coming years, and the skills they currently have. That sparked a small flood of complaints. This week, Editor Matt Kelly responds to that criticism and offers some thoughts of his own on the future of a profession whose importance will only continue to grow.
 

Calling All Compliance Pros!

August 15, 2011

Compliance Week subscribers, we need your help! We have two upcoming items of business that need input from compliance experts, and that means you. First is a call for ideas for our Compliance Week conference, to be held next June. Second is a survey of compliance in the life sciences industry, where we want your input. Editor Matt Kelly has all the details inside.
 

Pride and Prejudice, Risk and Regulation

August 08, 2011

Spare a thought for your company's treasurer or head of risk management this week; If you don't know who that person is, just look for the one banging his or her head against the wall. As Compliance Week Editor Matt Kelly writes, corporate treasurers entered a new world of turbulence last week—and the way Congress is behaving these days, we're all likely to follow.
 

Policy Management Best Practice

August 01, 2011

Who knew that compliance officers could get so animated about policy management? You did, apparently, since Compliance Week had a full house when we held our most recent editorial roundtable on that very subject in Boston with co-host EthicsPoint. Inside, Editor Matt Kelly ponders a few lessons learned, including the importance of a policy on policies and the irritation of exception requests.
 

A Trio of Compliance Thoughts

July 11, 2011

Sometimes so much is happening in the world of corporate compliance that it's hard to keep current; this would be one of those weeks. From the News of the World to the cost of lousy recordkeeping to the future of XBRL, Compliance Week Editor Matt Kelly has his quick takes on all three subjects inside.
 

The Hardest Department to Work With?

July 05, 2011

Compliance departments depend on other corporate departments to get their job done. And while working with legal, IT, internal audit, or ethics is fairly well understood, one department stands out as more vexing: HR. That's unfortunate, because HR could (or at least, should) help steer corporate culture. Compliance Week Editor Matt Kelly has more thoughts inside.
 

A Quick Book Recommendation

June 26, 2011

I haven't had opportunity to do a book review in this column for many months, but one title recently caught my eye while I strolled through my local bookstore: Understanding China, by John Bryan Starr. (Hill & Wang, 448 pps., $17.95) What this says about my browsing habits, we'll leave unspoken—but anyone looking for a better grasp of why China behaves the way it does should start reading immediately.
 

Calling All Deep Thinkers in Compliance!

June 22, 2011

Well, we wrapped up our Compliance Week 2011 conference only last month, and the good times and lessons learned are still fresh in people's heads. Time marches on, however—and we're already seeking executives to serve on the advisory board for our Compliance Week 2012 event next year. Interested? Compliance Week Editor Matt Kelly has more inside.
 

The Elusive Art of the Risk Assessment

June 20, 2011

Compliance Week hosted its latest editorial roundtable in Chicago last week, to ask compliance officers how they're handling the explosion of anti-corruption laws globally. Instead, CW Editor Matt Kelly says, most of the conversation dwelled on risk assessments: who should do them, and whether they're really that useful. His thoughts are inside.
 

What Codes of Conduct Should Really Achieve

June 13, 2011

Just as troubling as the allegations against Dominique Strauss-Kahn is the news that his institution, the International Monetary Fund, had a separate code of conduct for senior executives such as "DSK." This week, Compliance Week Editor Matt Kelly muses on exactly why dual codes of conduct are so odious—because, he says, the answer illuminates what should be in your single, enterprise-wide code of conduct quite a bit.
 

The State of Compliance, 2011

June 06, 2011

Last fall, Compliance Week and PwC launched a new project: the State of Compliance report. Our mission was to document current practice at corporate compliance departments across a host of issues—reporting relationships, staffing, risks, metrics, and more—and finally end the drought of benchmarking data compliance officers need. The results are in, and Compliance Week Editor Matt Kelly has a first look at them.
 

The Big Lesson From Compliance Week 2011

May 31, 2011

The Compliance Week 2011 annual conference is now fading into memory, and as always it was an outstanding and informative event. Inside, Compliance Week editor Matt Kelly offers his big lesson learned from the conference—thanks to one superb keynote speech, and one irritating protester who demonstrated just how challenging the job of a corporate compliance officer can be.
 

Pre-gaming the Compliance Week 2011 Conference!

May 22, 2011

For those of us still here since the Rapture failed to arrive this weekend, we have our own good news to get your week started: The Compliance Week 2011 conference is officially underway! Inside, Compliance Week Editor Matt Kelly offers his thoughts on what's likely to be most interesting and most useful, and what CW 2011 attendees should watch for. And the rest of you, don't worry: We'll have complete coverage in next week's newsletter.
 

What 'Effective' Compliance Really Looks Like

May 09, 2011

Not long ago we held another of our Compliance Week editorial roundtables, in Atlanta with co-hosts Compliance 360, to talk about the challenges of measuring the effectiveness of your compliance program. Inside, Compliance Week Editor Matt Kelly recaps some of the most interesting points—because, he says, "the more I ponder how you measure 'effective' compliance, the more I realize how elusive that idea really is."
 

Compliance Week 2011 Takes Final Shape!

May 02, 2011

We've just about nailed down the final planks of the Compliance Week 2011 annual conference, which gets underway three weeks from today. Inside, Compliance Week Editor Matt Kelly gives an update of what's to come—and why it will be worth your coming to see and participate, as well!
 

Perils of Policy Management

April 11, 2011

At first glance, policy management seems like one of the nerdier elements of corporate compliance. But from airline security to Walmart's recent appearance before the U.S. Supreme Court, policy management appears again and again as one of the fundamental challenges effective corporate compliance programs need to master. Compliance Week Editor Matt Kelly shares his thoughts inside.
 

More Thoughts on Where Compliance and Ethics Come From

March 28, 2011

What does good corporate ethics look like? Compliance Week and Crowe Horwath hosted an editorial roundtable in Dallas last week to find out. From regulatory pressures, to investigative skill, to simple "code overload," Compliance Week Editor Matt Kelly offers a few preliminary thoughts inside. Hint for compliance officers: If you want a strong ethics function, it helps to be cynical.
 

Ethics, Compliance, and Company Size

March 21, 2011

Ethics and compliance can mean different things to different companies, and perhaps some of that difference hinges on a company's size. Inside, Compliance Week Editor Matt Kelly muses about the challenges of achieving ethics and of achieving compliance—which, he says, aren't necessarily one and the same for all businesses.
 

World to Renault: J'accuse!

March 14, 2011

French automaker Renault has captivated corporate compliance circles for two months, first as the alleged victim of corporate espionage, then as the company that wrongly fired three employees during a bungled investigation into the charges. The dénouement, Compliance Week editor Matt Kelly says, is a setback for compliance officers everywhere and some painfully learned lessons the rest of us should take to heart.
 

Actions Have Consequences

March 07, 2011

From stealth risks buried in supposedly noble reform laws, to simple matters of personnel management—compliance officers can often find themselves surprised by outcomes they weren't expecting. This week, Compliance Week Editor Matt Kelly ruminates on two headaches that better thinking could have anticipated, and might have avoided.
 

Introducing the State of Compliance Survey

February 28, 2011

Compliance Week and PwC have launched an ambitious effort to end the lack of benchmarking data about compliance operations once and for all: the State of Compliance survey. But to get data that you can use, we need your help—we need you to take our survey! Yes it's free, and yes your data will be confidential and protected. Details inside.
 

SEC Budget Crisis Looms Large

February 22, 2011

The budget impasse in Congress will likely reach crisis proportions in the next 10 days, with the SEC caught square in the middle. Compliance officers shouldn't welcome this news, Compliance Week Editor Matt Kelly says, because they'll be caught square in the middle too. More of his views are inside.
 

When Compliance and Technology Collide

February 14, 2011

Cloud computing is one of those technologies that can leave compliance departments utterly confounded about how to manage it. But perhaps another technology steeped in compliance, XBRL, points the way to a solution. Inside, Compliance Week Editor Matt Kelly describes his vision.
 

Egypt's Pyramid Scheme Unravels

February 07, 2011

Corporate compliance and governance executives can draw plenty of lessons worth learning as the world watches Egypt's government unravel. Compliance Week Editor Matt Kelly has been watching the spectacle as much as anyone else, and he offers three observations.
 

Latest on Whistleblower Rules: Nothing Good

January 24, 2011

Few issues burn up Compliance Week Editor Matt Kelly's e-mail box these days as much as the new whistleblower bounty rules soon to come from the SEC. Unfortunately, he writes, the latest signs from Washington suggest nothing good for corporate compliance departments. More inside.
 

Advice for Young Compliance Officers

January 17, 2011

What are the most important steps a young new compliance professional should take to launch a successful career? Compliance Week Editor Matt Kelly has been pondering that question lately, since a recent law graduate asked him for advice. His thoughts are inside, but more importantly—your thoughts are needed too.
 

Facebook Tries to Befriend the Public Markets

January 10, 2011

Last week saw Facebook take a big step toward joining the world of publicly traded companies. Facebook and plenty of compliance critics might not like the burdens that status will bring, but as Compliance Week Editor Matt Kelly notes, this is the price we pay in today's hyper-connected capital markets. More of his thoughts are inside.
 
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