Corporations should coordinate Ethics and Legal Compliance:
a single officer at the highest executive level.

Executive Summary.  (1) Corporation legal compliance and ethics performance needs a single corporate officer working at the highest executive  level and charged with the job of implementing and monitoring a system for both legal compliance and ethics compliance. (2) In many cases corporation legal compliance and ethics performance needs a single corporate officer working at the day to day operating level charged with the job of implementing and monitoring a system for both legal and also ethics compliance and also problem avoidance and problem resolution.  In other companies, the job should be split between ethics and legal portions. (3) An ethics implementation project is best done with the help of an outside project consultant and outside educational seminars.

Preventive maintenance is a phrase that doesn't just apply to motor vehicles. White Collar Crime Litigation - Commercial Litigation - Employment Litigation. Just some of the possible consequences from a business in crisis.  At any time, a crisis may turn a business's world upside-down -- as the events of 9/11, Enron, and WorldCom have done. Litigation of all kinds are facing some of today's corporate giants due to mismanagement, fraud, inadequate corporate governance. The backlash of disaster can affect many.

News articles about bad business ethics causing corporate scandals are so common today that they often are hidden on the back pages of the newspaper, as not even worthy of front page attention.

Corporations need preventive maintenance of their legal compliance and ethics compliance systems.  Maintenance means ethics seminars, training, education. More than maintenance, corporations need to be proactive in building their corporate culture.  An essential element of an integrated business is an value system - an ethics system.  An forward moving ethics system melds hundreds or thousands of employees into a unified and successful business. The events of the last year have made corporations and their legal counsel understand that fact of business organization life.

We suggest two things to you:

(1) Most corporations should have an operating level LC&EO Office, with a combined  Legal Compliance and Ethics system.  An LC&E system needs coordination.  You might call the person in charge of this office a Compliance Officer (CO) or a Chief Compliance Officer (CCO).  We sometimes use the LC&EO designation to emphasize the dual compliance monitoring and day to day implementation of compliance and ethics that is this officer's job. In today's culture a company is ahead of the curve if it has a single individual whose job it is to coordinate the corporation compliance with both legal requirements and also its own ethics standards.  Whether that coordination at the highest level in accomplished by one person or two, and whether the coordination at the operation level is accomplished by one person, or two, depends upon the unique characteristics of the company.  Legal compliance and ethics compliance are often two sides of the same coin, so coordination is needed.

(2) The best way to start, or improve, the ethics portion of a unified ECO system is to utilize the services of an outside ethics project manager.  For ethics installation you do not want an outside law firm that has a legal checklist as a primary focus.  A legal checklist is not an ethics culture.   Building an ethics culture is specialized, time-consuming, and not legal work; and for that you do not want a law firm charging you for legal work.  You probably already have a corporate counsel and major components of a  legal compliance system. You need an outside ethics consultant - perhaps as an ethics project manager - to see that business ethics is built into your corporate culture and company governance. 

There are three main reasons for using an outside ethics consultant to help you set up or revise your ethics compliance system as a part of a combined Ethics and Compliance program.

	One. It is the best way to implement the ethics compliance that your corporate lawyer recommends as needed in today's legal climate.  Most busy corporate counsel do not have the time or the training, and usually does not want, to spend time working with lower level management and employees in doing the details to put into place the ethics compliance that you need.  On the other side of the corporate counsel/business employee relationship, your corporate employees do not have the ethics training to understand how best to implement what legal counsel recommends.  An outside project manager or consultant stands at the intersection of your lawyer and your employees.  The outside consultant first works with your existing attorney or legal department, to understand the legal compliance that the law department wants.  The outside ethics consultant then works with your existing employees and procedures. He/she designs and then put into place working ethics procedures within your organization. Read your action list.
	Two.  Most corporations do not have persons with training as ethicists.  An ethicist is vital to teaching employees how to spot ethics problems and how to solve them.  Only after employee training, with seminars and more, can you proceed to implement your ethics goals into working procedures within your organization.   Your management and your employees need to understand the corporate goals --- and they need to have the tools to solve ethics problems before they become a corporate crisis. Only an ethicist can give the initial "push" and training that corporate employees need to have.
	Three:  The outside consultant is an outsider.  If you want what you have now, use your present employees.  If you want a major change, get an outside ethics consultant on board your project team.  Corporations that have outside directors understand that outside advice is valuable. Businesses need the infusion of new thought through an outside consultant if they want more ideas and movement than they now have.  Moreover, securing an outside consultant sends the right message to managers, employees, and investors.

Those three reasons is why we say: any business entity, whether profit or non-profit organization, is best served by initially retaining an outside consultant to design and integrate ethics into a combined ethics and compliance program.