Following a major oil spill, industrial accident, or other compliance crisis, sophisticated companies typically conduct a thorough internal investigation using legal counsel. After the investigation, the company takes corrective actions based in large part on counsel’s recommendations, which often include additional training; new policies and procedures; and increasing monitoring, audits, and inspections—all designed to reduce the risk of recurrence. But what if the compliance crisis had more to do with a dysfunctional corporate culture than a missing operating procedure? Can additional bureaucracy actually increase the risk of noncompliance? This article explains how legal counsel can use a compliance crisis to examine the role of corporate culture and take actions that better reduce compliance risks.
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