corporate compliance article – v10.docVIP

From PLI’s Course Handbook Corporate Compliance and Ethics Institute 2007 #10805 Get 40% off this title right now by clicking here. 8 RIGHT-SIZING: CUSTOMIZING COMPLIANCE TO THE SMALL CORPORATION Kristen K. McGuffey Thomas C. Soldan Simmons Bedding Company ? 2006 Simmons Bedding Company Reprinted from the PLI Course Handbook,Advanced Corporate Compliance Workshop2006 (Order #8743)  RIGHT-SIZING: CUSTOMIZING COMPLIANCE TO THE SMALL CORPORATION Submitted By: Kristen K. McGuffey Thomas C. Soldan Simmons Bedding Company  Developing the Right-Size Compliance Program In the increasingly complicated world of protecting against corporate fraud and ethics violations, corporate compliance programs have risen to the forefront of counterattacking measures to restore consumer and investor confidence. Though certainly not new to the scene, formal corporate compliance programs have evolved in the past decade from something that was only common in larger corporations in highly regulated or litigious industries into a near-mandatory feature of corporate governance for any size company, and in particular those that are public. This article addresses why small corporations should develop compliance programs and explores issues that present themselves in developing a corporate compliance program that is appropriate and “right-sized” for the smaller company. Obviously, not every corporation has the resources to develop a corporate compliance program that has all the bells and whistles of a “best in show” program. Nor is that expected. Under the United States Sentencing Commission’s Sentencing Guidelines Manual (hereinafter “Sentencing Guidelines”), which has been the driving force behind corporate compliance programs for many years, it is clearly stated that a compliance program “shall be reasonably designed, implemented and enforced” and that, in evaluating a program, a court can take into account the sophistication of the program in relation to the size of the corporation.