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CT Review (September 2022)

Flying an airplane is an incredibly complex job that requires huge amounts of training. Yet, when a pilot is suddenly unavailable, the airline usually locates another pilot who is also qualified to fly the aircraft, and the flight proceeds with nothing more than a slight delay.

Is the same kind of seamless transition possible when the chief compliance officer retires or resigns? Or if a key member of our compliance team leaves?

Unfortunately, the answer is all too often “no”. And the reason is that a compliance program is different from even a very complicated machine that someone can be trained to use. The pilot doesn’t have to talk and persuade the plane to fly properly; it responds to commands and switches that the pilot operates.

But in compliance, success relies heavily on relationships, communication, negotiation, and persuasion. Hooking up a new person in a relationship becomes complicated. Learning the technical aspects of a compliance program (eg risk assessment, training, monitoring and auditing plans) is easy by comparison. Building the relationships that are essential to the success of a program takes more time.

In smaller organizations, succession planning will be inherently more difficult than in larger ones. But, where possible, building relationships with multiple members of the compliance team, particularly if there is an identified successor to a particular position, helps ensure a smoother transition when someone leaves the organization. crew.

In May, Katherine Eilers and Tammy Jelinek of accountancy and advisory firm Wipfli discussed succession at the SCCE & HCCA Nonprofit Sector Compliance Conference.[1] Importantly, Eilers and Jelinek distinguished proactive succession planning from reactive replacement planning.

The best compliance programs are those that would continue to operate effectively in the event of a sudden departure, even if that departure is that of the chief compliance officer. The best leaders are those who position themselves as valued and desirable, but not absolutely essential to the continued operation of the program. You want your organization to strongly prefer that you stay, but you don’t want them to feel like the program would fail if you left. It takes a strong and confident leader to achieve this, but it’s an important first step in succession planning.

Next month I will discuss another important aspect of succession and compliance.

1 Katherine Eilers and Tammy Jelinek, “People and Compliance: Challenges in Nonprofit Organizations,” Nonprofit Sector Compliance Conference, May 24, 2022, organizations-0.

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