Table of Contents
On this page:
- What this means
- Why this matters
- How you can evaluate your program and revise measures
- Tips for evaluating your program and revising measures
What this means
New risks to compliance emerge all the time. So you need a compliance program that can keep up. The only way to be sure your program is working effectively is to evaluate it regularly and, if necessary, revise your compliance measures.
You should ensure that the design of your compliance program addresses all of the principles in Build a credible and effective compliance program for your business. You should also ensure that your compliance program is fully implemented. Finally, you should check to make sure it actually works in practice.
A small reminder on what makes a compliance program credible and effective
Your compliance program needs to be credible and effective to truly help you.
To be credible, your program must at a minimum show your business’ genuine commitment to obeying the law and competing fairly.
To be effective, your program must inform all your people, and those acting for your organization, that compliance is important. It must inform them of their legal duties and your internal compliance measures. It should also give you the tools to prevent and detect misconduct.
Your program should be reasonably designed, implemented and enforced in the circumstances. This means that it addresses your organization’s risks within your resources and in light of your business activities.
Why this matters
Regular evaluation of the effectiveness of your compliance program can help you confirm whether the money and resources you spend on a compliance program have in fact mitigated the risks your organization faces.
Evaluation can help in checking whether:
- your compliance culture and governance are strong
- your risk assessment is up-to-date
- your policies, procedures and controls are adequate
- your training and communication need to be reviewed and refreshed
- your reporting mechanisms are robust
- your monitoring and audit systems are aligned to your operations
- your incentives and disciplinary measures actually encourage your people to do the right thing
The results of an evaluation should guide how you revise your compliance program to keep it effective and up-to-date.
Finding areas in your compliance program that need improvement and taking steps to revise them are not signs of failure. They are a normal part of any management review. It is not very credible to claim that you have never made a change because everything was always perfect.
If the Competition Bureau were to review your organization’s compliance program because of concerns about illegal activities, we would look at your evaluation and revision practices as part of our process to determine whether your program is credible and effective.
If you’re a small business...
Evaluating your program and updating compliance measures doesn’t have to be costly. Program evaluation can be carried out internally by your organization. Consider whether your industry or trade association can act as a forum to share compliance best practices.
How you can evaluate your program and revise measures
You should evaluate each element of your compliance program and the program’s overall effectiveness to assess whether your program actually works in practice.
For your compliance program to be credible and effective, you should evaluate:
- Evaluate the design of each part of your compliance program —cover all the principles of compliance discussed in Build a credible and effective compliance program for your business
- Determine the effectiveness of your compliance program’s overall design
- Determine whether the governance structure for your compliance function suits the overall structure of your organization, especially when there are changes to your organization
- Determine whether all elements of the program have been effectively rolled out
- Assess whether the resources you’ve provided to your compliance officer are sufficient to actually implement your program
- Evaluate whether or not management, employees and others are actually following your compliance program
- Determine whether your reporting mechanisms or other parts of your program have actually identified risky behaviour or potentially illegal activity and allowed you to address them early and effectively
- Understand the impact of your compliance program on the overall culture of your organization
Carry out the evaluation of the overall compliance program at regular intervals. In addition to periodic review, you should review the parts of your compliance program that might be affected when there are business changes that can lead to risk or when you spot a gap in the existing program. You can choose different methods to evaluate your program, depending on what you’re evaluating and what goals you identified for the assessment. Based on the result of your reviews, make improvements quickly.
Role of the compliance officer
The compliance officer should:
- have the authority and necessary resources to coordinate the evaluation process at regular intervals
- coordinate assessment of your compliance program using appropriate methods to get accurate information
- be allowed to make necessary changes to the compliance program
Tips for evaluating your program
These may be some methods for evaluating your compliance program:
- regularly examine your employees’ attitudes, beliefs and knowledge about the law and your compliance procedures
- consider seeking input from third parties dealing with your organization, such as contractors and customers
- Post-training follow-up meetings
- Focus groups
- Exit interviews of employees including senior individuals
- Tests of reporting and verification tools with simulated violations
- Closer scrutiny of particular business units or locations that have presented a history of compliance risks in the past
- Analysis of data from your compliance controls and from relevant business functions (for example, sales, pricing and marketing)
- Test runs by making calls to the helpline
- Peer reviews and benchmarking with international standards or comparable organizations, in accordance with competition law and the Competition Bureau’s guidance on competitor collaborations and wage fixing and no poaching agreements
- Reviews of external compliance news for new potential compliance best practices
- Occasional review of your compliance program and the performance of your compliance officer by independent third parties who report directly to the board of directors (or the highest governing authority in your organization)
DISCLAIMER: Because every situation presents unique facts, the information set out herein is provided for general information only. This content is not a substitute for legal advice, nor is it a binding statement of the Commissioner of Competition’s position on the requirements or efficacy of any particular compliance program. Indeed, there is no one-size-fits-all approach when it comes to achieving credible and effective compliance.
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