The Importance of an Effective Compliance Program
On September 9, 2014, Brent Snyder, Deputy Assistant Attorney General of the U.S. Department of Justice Antitrust Division, provided prepared remarks on the subject of “Compliance is a Culture, Not Just a Policy,” before the International Chamber of Commerce/United States Council of International Business Joint Antitrust Compliance Workshop in New York City. Snyder explained that an effective corporate compliance program is an important part of a company’s effort to prevent antitrust violations.
According to Snyder, compliance programs make good business and common sense. He noted that compliance programs help prevent companies from committing crimes. And, that even if a compliance program is not entirely successful, a partially successful compliance program may help a company qualify for leniency. Snyder believes there is no one-size-fits-all compliance program. Instead, an effective compliance program should be designed to account for the markets a company operates in and the nature of a company’s business. He also reviewed five things the Antitrust Division looks at when evaluating a company’s compliance program.
First, a company’s board of directors and senior executives must engage in and be fully supportive of the company’s compliance efforts. This means that senior management must be fully knowledgeable about the company’s compliance efforts, including providing the necessary resources and having the appropriate personnel oversee the program. Second, the entire company needs to be committed to executing the policy. Companies show this by training all executives and managers, and most employees, especially the employees with pricing and sales responsibilities. Third, the compliance policy should be proactive. To do so, companies should monitor and audit “risk activities.” Fourth, a company should have an approach to individuals that break the antitrust laws, including being willing to discipline employees for any violations. Finally, a company that uncovers criminal antitrust conduct should be equipped to prevent the conduct from happening again, which can mean making changes to its compliance program and being prepared to accept responsibility for that conduct.
Snyder also mentioned that having a compliance program may still benefit a company planning to plead guilty to an antitrust crime. The examples he provided were companies with compliance policies possibly being able to avoid additional oversight by the court and the Division. The Sentencing Guidelines require an effective compliance program. If a company does not have one or can’t show it is updating its existing one, a company will most likely be on probation. However, if a company can show that they adopted or strengthened an existing compliance program it may be able to avoid probation. The Division is also considering possible ways to credit a company that proactively strengthens or adopts a compliance program after the commencement of an investigation.
In the end, however, Snyder was clear that the purpose of “having an effective compliance program is not so that the Division will cut you a break if your company commits a crime.” Instead, the purpose of an effective compliance program, as described by Snyder, is to be a “good and responsible corporate citizen.”