How has the economy impacted compliance and ethics in the last few years? And what’s in store for 2011? According to an annual survey conducted by the Society of Corporate Compliance and Ethics (SCCE) and the Health Care Compliance Association (HCCA), despite the hurting economy, a greater number of compliance professionals report an increase in compliance staff and budgets along with greater of job security in 2010. However, the survey also found that a small minority of compliance officers believe their management sees compliance and ethics as a detriment to the business.
While SCCE/HCCA Chief Executive Officer Roy Snell agrees that this is good news, he states, “Budget and staff growth must equal the demand for regulatory compliance and business ethics.”
Snell points out that a number of new regulatory initiatives including Dodd-Frank Wall Street Reform and Consumer Protection Act, health care reform laws, and the UK Bribery Act are each putting pressure on organizations to increase their compliance efforts. “Regulators may take a dim view of companies that experience a compliance failure after not increasing their compliance resources,” added Snell.
The data revealed by the survey finds that in both 2009 and 2010 compliance budgets were more likely to increase than decrease. The study finds that 46% of survey respondents expect their budgets to increase in 2011 with just 12% expecting a decline.
The study also found that 31% percent of respondents reported an increase in compliance and ethics team staffing, while just 10% report a decrease. Job security is also on the rise. More than half of the survey respondents reported they were not concerned about losing their job as a result of the economy; that’s up from 44% in the last two years.
Management’s perception of compliance and ethics is also up. The survey reveals that 58% of respondents report that senior management views compliance as a “somewhat positive” or “very positive” asset; up from 51% from 2009 and 49% in 2008. Yet it is worrisome that 13% reported that management views compliance as a hindrance.
Significant changes in the compliance landscape have marked the end of business as usual, and compliance is now a serious board level concern. Despite significant progress in compliance and security programs within organizations, a new era is upon us with heightened compliance obligations, and organizations that don’t have the proper security controls will have to catch up quickly to in order to compete in the increasingly globalized economy.
The complete results may be downloaded here.
