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Andy Spalding
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Jessica Tillipman
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Bill Steinman
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Richard L. Cassin
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Elizabeth K. Spahn
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Cody Worthington
Contributing Editor

Julie DiMauro
Contributing Editor

Thomas Fox
Contributing Editor

Marc Alain Bohn
Contributing Editor

Bill Waite
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Shruti J. Shah
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Russell A. Stamets
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Richard Bistrong
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Eric Carlson
Contributing Editor

Julie DiMauro: Sometimes Sunshine, Sometimes Rain — The CCO and Fellow Employees

I became a runner for the first time in my life in late 2003. I had run the Corporate Challenge while working at Fidelity Investments in Boston, and I became hooked. I called the contact person for a large running club in my area of Boston, and told him I was interested in joining them for a run.

These folks were the most welcoming people. I was a dedicated member in my first year, quite enthusiastic about my newfound hobby, and happy to make new friends. (And who doesn’t like their first year of running when it’s undoubtedly full of personal bests?)

The club had a board of directors that organized water stops during long runs, run routes, the races the club would host or co-host, plus its outreach with the public.

The president of the club asked me if I would consider serving as its “Sunshine” board member.

I had no idea what that meant, except that I figured the role was a ticket to instant popularity, plus an interesting factoid to bring up in job interviews (“I am on a board of directors. I am the Sunshine. I make tired folks happy, when skies are gray.”).

So I said yes before finding out what it entailed.

Basically, I was a compliance officer for the club.

I made sure the routes we took were not going to traipse on private property. I made sure our race events were following routes that were approved by the right entities in the city. I made sure the recreation center we used to store our bags and stretch after runs continued to appreciate our presence, and whether and how any members might have broken any of their rules of use.

I’d be running, and people in the club would give me their ideas as we strode down the road: “Hey Sunshine! I have a few ideas about charity efforts.” And I’d be forced to chase the really fast folks — like the man who would later become my husband and his buddies — when I needed their input.

(I know he sped up just to make me work harder.)

It was not an easy job balancing the demands of a diverse, 400-person running club, and the city, its area residents and the club’s founders.

But I don’t have to explain this to someone who does this on a FAR, FAR higher level for work.

Competing interests, and your own needs and limited time and resources, make compliance hard enough. Add in the pace of regulatory change these days and an increased focus on the personal liability of anyone deemed a supervisor, and “Sunshine” is laughable — just an incredible misnomer in the business world.

But looking back at the experience, and thinking about what my panel-mates last Wednesday said at the FCPA Blog’s inaugural conference event in New York, I just realized something.

The Sunshine of the club worked for the members.

That person was beholden to the members for how well the organization functioned, stayed out of trouble with any authorities, and generated goodwill.

I think Mike Scher is right that the chief compliance officer of any firm must get his or her direction and seek the support of the Board of Directors to maintain independence and not be manipulated by any other executive at the firm.

And I agree with Tom Fox that if any CCO is not getting such backing, he or she has to consider leaving the organization.

But I want to proffer as well the idea that the CCO is there to make sure the employees of the firm know they will not have to compromise their integrity — or drink hand sanitizer — just to make it through a day of trying to meet insane cross-selling quotas.

They are there to advocate for the employee who is being told in so many terms to cut regulatory corners and even the firm’s own policies. By going to the board of directors as Mike said, or even regulators when their warnings fall on deaf ears.

It’s not easy. The CCO is an employee too, needing a job, a salary and a bonus.

But when the CCO raises the red flags that make critical changes happen in an organization and working there better, easier, even healthier — and when a company can tout its regulatory record with pride, along with its profits — I suppose in those moments, it’s a bit like being a Sunshine.

___

Julie DiMauro, a Contributing Editor of the FCPA Blog, is a senior editor and compliance specialist in Thomson Reuters’ New York office and its Financial & Risk Regulatory Intelligence division.

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