How did more than 900 compliance and ethics professionals respond to a survey asking which compliance risks they would be focusing on in 2016? Overall, the respondents identified cybersecurity and cybercrime (39 percent), social media compliance risks (38 percent), leveraging compliance practices with business practices for greater efficiency/effectiveness (34 percent), creating and maintaining an ethical culture (32 percent), and more effective internal investigations (31 percent) as their top concerns, the Health Care Compliance Association (HCCA) and the Society of Corporate Compliance and Ethics (SCCE) announced on February 22, 2016.
In January of 2016, the HCCA and SCCE sent out a survey that included a list of 38 topics and requested respondents to select no more than ten topics on the list to determine which topics were uniquely important to compliance and ethics professionals in 2016. According to the survey report, “Compliance and Ethics Hot Topics for 2016,” responses varied by respondent type in terms of ranking, however, overall many of the five top hot topics identified appeared in the breakdown of all of the company or job types at some level.
In-house compliance practitioners were totally in step with the overall results, while respondents from small companies identified the same five hot topics but not in the same order. Nonprofit respondents identified False Claims Act (FCA) enforcement rather than creating/maintaining an ethic culture in their top five.
Consultants and solution providers identified leveraging compliance practices with business practices for greater efficiency/effectiveness as its number one hot topic and cybersecurity and social media compliance as number two and three of their list, respectively. Interestingly, consultants and solution providers also named FCA enforcement (33 percent) and the Yates memo with increased prosecution of individuals (31 percent) as number four and five of in their list of hot topics.
Respondents from multinational, publicly traded, and large companies each listed third-party risk as number one, and respondents from privately held companies listed third party risk as number five. All four entities listed cybersecurity and leveraging compliance practices with business practices for greater efficiency/effectiveness among their top five.
Cyber security was first on the list for educational institutions and increasing the breath of skills of the compliance team was second. Government employers ranked creating/maintaining an ethical culture, first; cybersecurity, fourth; and increasing the breath of skills of the compliance team, fifth. Social media compliance risks appeared on both lists.
What can be learned from the survey
According to SCCE and HCCA CEO Roy Snell, the survey results show that “compliance is spanning the spectrum from culture to cybercrime. That’s an enormous mandate and really talks to how much businesses have come to rely on compliance programs to ensure that their organizations operate properly.” Wolters Kluwer contacted Snell to find out what else can be learned from the survey results.
Question: How have the risk areas compliance and ethics officers face changed in the past few years and why?
Answer: “The risk areas covered by compliance professionals have broadened. In the beginning, the risks were more fundamental and common. Now the risks are more esoteric, such as cybersecurity.”
Question: Why do large companies, publicly traded companies, and multinational companies consider third party risks the number one risk for their organizations?
Answer: “Part of it may be that it’s a new risk area that has not received much attention in the past. There has been recent interest in this area by enforcement. It can be a huge public relations issue because some of the problems caused by third parties that are happening in other countries are considered unacceptable to our culture. It took a while for companies to accept the fact that they are accountable for the actions of those [to whom] they subcontract some of their work.”
Question: “False Claims Act enforcement appears on a couple of respondent types top five list, but it did not make the top five. Why, in light of the Yates Memo, the increased risk of prosecution of individuals, the publication overpayment final rule, and increasing numbers of FCA claims, do you think that FCA enforcement did not make it to the top 5?”
Answer: “The False Claims Act is primarily designed to deal with industries that contract with the government. Some industries do a lot of work for the government, some do very little.”
Question: Creating and maintaining an ethical culture appeared on most respondent type lists (between 31 percent and 35 percent) and was ranked number one (45 percent) on the government employers list. With all of the focus on compliance including guidances, laws, regulations, and memos why would respondents of various types select creating and maintaining an ethical culture as a hot topic? What are the obstacles compliance and ethical professionals face in creating and maintain an ethical culture?
Answer: “I think you hit the nail on the head in your last sentence of the question. There are obstacles. Building an ethical culture is like pushing Jello up hill. It’s not an exact science and there is employee turnover. Building an ethical culture will probably always be on the list because it is such an important part of a compliance program, a difficult and never-ending battle. I am not sure why culture is more important to those in government. It may be they have a more difficult environment for some reason. It may simply be that they consider culture to be more important than the other risks.”
Question: What do you want compliance and ethics professionals to take away from the survey results?
Answer: “They are not alone. Everyone has a long list of concerns. It’s a never-ending battle. They might shift their focus a little based on the survey. Some compliance programs don’t include some of the risks included in this survey. Some compliance officers are told ‘Don’t go there.’ They may be able to show this survey to the people who are trying to limit their scope. And it’s possible that their leadership will be more open to making sure that their compliance officer covers all risks because this survey shows that it is common practice for compliance officers to do so.”
Although in 2016, cybersecurity and social media compliance risks topped the list of concerns for compliance and ethics officers, fundamental concerns such as leveraging compliance practices with business practices for greater efficiency/effectiveness, creating and maintaining an ethical culture, more effective internal investigations, and False Claims Act enforcement will continue to be high on the list of compliance concerns.