Chief Compliance Officers Find DOJ’s Recent Guidance Documents on Effective Corporate Compliance Programs Are Helpful, Need More Detail

Chief Compliance Officers Find DOJ's Recent Guidance Documents on Effective Corporate Compliance Programs Are Helpful but Need More Detail
U.S. Department of Justice. © Patrick Semansky / AP Photo

On December 14, the Ethics & Compliance Initiative (ECI™) released the report of findings from a survey of nearly 250 chief compliance officers (CCOs) on the value and impact of several guidance documents issued by the U.S. Department of Justice (DOJ) since 2019. The Corporate Compliance Program (CCP) and DOJ Enforcement Policies survey inquired about CCOs’ views of four primary DOJ policy or guidance documents that communicate the criteria used by the DOJ to evaluate the effectiveness of corporate compliance programs in enforcement decisions. The survey further sought CCO input about ways the DOJ could further incentivize corporate compliance and encourage corporate self-disclosure and cooperation in the event of violations.

ECI surveyed ethics & compliance (E&C) leaders about the DOJ’s:

  • Evaluation of Corporate Compliance Programs (CCP), updated June 2020;
  • Guidelines for Taking Disclosure, Cooperation, and Remediation into Account in False Claims Act Matters (FCA-related policies), issued March 2019;
  • Resource Guide to the U.S. Foreign Corrupt Practices Act (FCPA), 2nd edition, July 2020 (this guide discusses the FCPA Corporate Enforcement Policy (CEP) contained in the Justice Manual [CEP as explained in the FCPA resources guide]);
  • Evaluation of Corporate Compliance Programs in Criminal Antitrust Investigations, issued July 2019 (antitrust compliance program guidance); and
  • Incentivizing effective programs and compliance in organizations.

ECI found that the majority of CCOs – on average 68% – were familiar with the DOJ’s four guidance documents. CCOs were most familiar with the DOJ’s Evaluation of Corporate Compliance Programs guidance document.

ECI also asked about the helpfulness of DOJ’s policies and found that E&C leaders overwhelmingly agreed they are helpful. CCOs said that they have been able to educate stakeholders about the DOJ’s perspective in order to promote the importance of compliance and to strengthen the cultures of their organizations.

The extent to which CCOs briefed various stakeholder groups about the DOJ’s issuance of guidelines varied by the policy document. Company efforts to adjust their programs in light of DOJ’s criteria also varied, in part due to the extent to which companies felt that their programs already sufficiently addressed the DOJ’s standard, or to the extent that the policy area (such as FCPA, FCA or Antitrust) was identified as a key risk for the corporation.

In terms of corporate willingness to self-disclose violations, particularly with regard to FCPA, FCA and Antitrust violations, CCOs indicated that their organizations would be more willing to self-disclose and cooperate if they were aware that the DOJ is consistently giving credit to other organizations for doing so. The challenge, however, is that an average 63% of CCOs indicated that they are unsure whether the DOJ is consistently declining prosecutions, awarding credit or negotiating plea agreements in alignment with its guidance.

Through the survey, CCOs offered suggestions as to how the DOJ could further incentivize corporate compliance programs. These included:

  • Providing illustrative examples of E&C program practices that were influential in DOJ’s declination decisions;
  • Providing more details of enforcement actions, improving its guidance documents, and engaging more with companies;
  • Providing credit for company efforts to build a strong ethical culture;
  • Dismissal of a qui tam action if the company maintains an effective compliance program in a situation where an employee failed to report internally before filing suit; and
  • Elimination of the threat of debarment or exclusion for companies with effective E&C programs.

“It is clear from the study that the Department of Justice has a significant impact on corporate compliance practices,” said Patricia J. Harned, Ph.D., Chief Executive Officer of ECI. “Respondents overwhelmingly agree that reforms demonstrative of a cooperative approach rather than a punitive approach by DOJ would incentivize improved corporate compliance in organizations.

“It is our hope that ECI will have an opportunity to speak further about these results with the DOJ, on behalf of the ethics & compliance profession.”

The Corporate Compliance Program (CCP) and DOJ Enforcement Policies Summary of Findings is available here.