Anyone doubting the commitment of business to compliance and ethics will be surprised by the findings of a survey which reveals spending on compliance has remained stronger than anticipated. Roughly three out of four companies either kept compliance spending even or actually increased it in 2009, and for 2010 the prognosis is even brighter.
The data was revealed in a new survey conducted by the Society of Corporate Compliance and Ethics (SCCE) and the Health Care Compliance Association (HCCA). This research was conducted among compliance professionals in the last quarter of 2009. The Survey Report also compares data gathered in the fall of 2009 with a similar survey conducted in December 2008. Use the following link to download the complete survey report: http://www.corporatecompliance.org
"Happily the overall impact has been less than anticipated and the prognosis is good," said Roy Snell, Chief Executive Officer, SCCE. "According to our survey results 33% expect a budget increase in 2010, and 18% expect their staffing to increase," added Snell. "This shows that the business community has come to realize that the price of cutting back on compliance far exceeds any potential rewards."
Snell also pointed out that "While the economy may be coming back, fears of compliance and ethics failures remained relatively the same as found a year ago, with fully one-third believing that the current economy has greatly increased the risk of a failure."
Survey Background
In December 2008 the economic meltdown was in full swing. The Society of Corporate Compliance and Ethics (SCCE) and the Health Care Compliance Association (HCCA) jointly launched a survey of compliance professionals to assess the likely impact of the faltering economy on compliance and ethics.
The 2008 survey indicated that 85% of respondents felt that the current economy greatly or somewhat increased the risk of compliance and ethics failures. So pervasive was this perception that only 1% took the contrarian view and felt that the legal and ethics risks might decline in this period. At the same time, there was great fear that compliance budgets would be reduced. As a result the risks would rise at the same time that the resources to manage them would decrease.
To determine the actual effect of the economy on compliance spending and staffing in 2009 and to learn the compliance profession's expectations for 2010 budgets and staffing, the SCCE and HCCA conducted a new survey during the months of October and November, 2009.
Survey Results
According to the survey, as a whole compliance budgets actually fared better than compliance professionals expected when surveyed in 2008. Fifteen percent of those surveyed in 2008 expected their budgets to increase somewhat or a great deal in 2009. But by the end of the 2009 26% of those surveyed reported that their budget had, in fact, increased. Likewise, 36% anticipated that their budgets would decrease somewhat or a great deal in 2009, but by the end of the year just 27% reported that their budgets had decreased.
The survey also revealed that for staffing the picture was also brighter than expected. At the end of 2008, 21% anticipated a decrease in staffing and just 11% expected the compliance staff to increase. By December 2009 respondents reported that 24% had seen a staffing increase and just 18% saw a decrease in staffing.
"Compliance professionals are seeing a sunnier picture when it comes to 2010 budgets," said Snell. According to the survey roughly one third of respondents expect to see a budget increase in 2010. "That's more than twice the number that expected budgets to rise in 2009," adds Snell.
Snell points out that at the SCCE 2009 Compliance and Ethics Institute Federal Sentencing Commission Member Judge Ruben Castillo cautioned attendees not to cut compliance budgets. That warning was affirmed by Deputy Assistant Attorney General Gary Grindler. "As the survey data indicates, many companies had already received the message. For the most part, compliance has fared both better than many other areas of corporate spending, and even better than compliance professionals anticipated."
New research explores how omega-3 and omega-6 fatty acids may impact cancer rates