Corporate Compliance Committees are one of the more recent trends seen in the area of Corporate Governance. These committees monitor the company’s compliance program and internal controls, disseminate information on compliance efforts and communicate compliance issues and business risks.
In order to be effective, Compliance Committees need to be given independent access to the data and personnel so they may identify potential risks and help rectify them. Other than reducing a company’s risk, compliance committees are also seen favorably by regulators in the event of scrutiny. Corporate Compliance Committees ensure that instances of non-compliance have been properly reported within the Company and that corrective action is taken by the appropriate persons with respect to such non-compliance.
While there are advantages to having a Compliance Committee, each organization has to evaluate whether the benefits justify the cost and effort, as the existence of a compliance committee does not guarantee a reduction in risk. Like any other regulation or committee established to ensure compliance and lower risk, Corporate Compliance Committees will only be beneficial when given the access to pertinent data and the authority to force change. Advisory professionals such as the Marcum Advisory Services Team have the background and experience to assist with these vital assessments.
Thanks to contributors Nitasha Joshi, Advisory Services