By Jeffrey M. Kaplan and Rebecca Walker
Is your board trained on anti-corruption law and compliance? Clearly, not every board should be trained on every compliance risk area. But for high-risk areas, training may be advisable – both to help a board exercise program oversight in an effective manner and to defeat a Caremark claim should a compliance failure occur.
In connection with this latter point, it is worth recalling that in the landmark case of Stone v Ritter, 911 A.2d 362 (Del. 2006), in which the court affirmed the dismissal of a Caremark claim against directors, the court extensively described the training that had been received by the board on the risk area at issue there (anti-money laundering). While the preventive dimension of compliance programs should always be seen as more important than their defensive use, the latter is of no small concern in this setting – given that, according to a press account last fall, FCPA-related Caremark claims have become much more frequent in recent years than they previously were.
Board training is one of the topics examined in the anti-corruption compliance program benchmarking survey we are conducting with the FCPA Blog. Our results to date show that:
- About thirty percent of respondents have conducted such training at least once and intend to do so again.
- A similar-sized group of respondents has conducted such training in the past but does not plan to do it again.
- About eight percent have plans to conduct such training.
- The remainder have not conducted such training and have no current plans to do so.
In other words, more than two thirds of survey respondents either have trained their boards on anti-corruption compliance or plan to do so (or both) – hopefully a useful statistic for companies considering whether to take this step.
And if you haven’t yet taken the survey – which closes later this month – we hope you will do so. In addition to board training, the survey addresses the related but distinct topic of board program oversight, and a host of other anti-corruption compliance program areas.
Information is submitted anonymously, and participating companies will receive a complimentary copy of a report containing the results and an analysis of the survey.
Jeffrey M. Kaplan and Rebecca Walker are partners at Kaplan & Walker LLP. They recently published a chapter in the BNA/ACC Compliance Manual on Compliance with the Foreign Corrupt Practices Act. Jeff, who is also co-editor of Compliance Programs and the Corporate Sentencing Guidelines (Thomson Reuters), can be reached at [email protected]. Rebecca, who is also author of Conflicts of Interest in Business and the Professions: Law and Compliance (Thomson Reuters), can be reached at [email protected].