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Harnessing Technology for Legal Compliance
Suzanne Rich Folsom, U.S. Steel and Kristyn J. Hyland , Bloomberg Law
Data analytics is a powerful tool that corporate legal departments can harness to help achieve their regulatory and compliance objectives. Essential steps include conducting a thorough risk assessment and mapping vulnerabilities to inform the imposition of strong internal controls. Potentially negative events that would impede regulatory, compliance and ethics objectives are identified by type. At that point, a risk-rating formula can be constructed.
Successful third-party due diligence is a vital component of a compliance program. It too requires the clarity that technology brings to important risk-related data. Ideally, a company with overseas operations would conduct reviews of all its third-party relationships, but that standard is unrealistic. The implementation of a robust risk analysis system allows the company to rank the levels of due diligence needed for each third-party vendor, and then assign the appropriate weight to each factor. With an algorithm designed to take numerous risk factors into account, an effective risk analysis and profile can be constructed. This process gives corporate legal departments a solution that provides the ability to customize the analysis for specific factors.
While no amount of law or regulation will completely eliminate illegal activity, we do know that a robust, ethical compliance program can help prevent violations as well as mitigate damage if violations do occur, and we now have powerful tools to drive additional positive results. The highest-performing companies have integrated compliance and ethics into the fabric of their culture and business operations.Read the full article at:
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