Boeing, Theranos, Volkswagen: On Common Compliance Ground
In this piece from ACC Docket, Gerry Caron, chief counsel, safety, health & environmental at Cabot Corp., a Boston-based specialty chemicals company, pulls lessons from the wreckage of three compliance disasters: the misdeeds of former Theranos CEO Elizabeth Holmes; Boeing’s 737 Max debacle; and VW's crazy campaign to evade emission standards.
All three cases trigger the same tone-at-the-top factor of the US Department of Justice (DOJ) criminal division’s guidelines for the evaluation of corporate compliance programs. Caron quotes DOJ -- "The company’s top leaders — the board of directors and executives — set the tone for the rest of the company” -- before commenting: "The emphatic pronouncement from on high (the C-suite) of an ambitious corporate mission, which excluded any ongoing conversation, learning, or feedback during execution, seemingly was the Achilles heel in all three cases. . . . In-house counsel, company leaders, and directors should pay careful attention to the description of mission, execution of it, and the interplay with corporate compliance culture considering these cases and the prominence of derivative shareholder lawsuits against officers and directors alleging inadequate board oversight. Compliance culture is critical to the mission of every organization — and an essential part of the in-house practice."
Read more of "What the Theranos, Volkswagen and Boeing Compliance Lapses Have in Common" at ACC Docket.
Published March 28, 2022.
