Compliance & Governance

This second-annual CRO’s Responsible CEO of the Year Award is different than any other business honor. First, it recognizes individual CEO expertise in articulating the common good and then convincing thousands of others to make a good business out of it. Second, it’s a trophy for leadership in progress, because perfection in Corporate Responsibility is a goal that’s always moving just beyond our grasp. And third, it reflects the professional chauvinism of the corporate responsibility-obsessed editorial team at CRO Magazine, the only publication solely focused on the four professional domains in Corporate Responsibility—GRC, sustainability, CSR and philanthropy.

Future of company citizenship and governance efforts take shape in tumultuous times

The “once in a century credit tsunami,” in Alan Greenspan’s words, is crushing old attitudes toward corporate governance while a second tidal wave of reform builds momentum.

The nature and depth of the crisis means “a new set of checks and balances,” particularly on financial institutions, “are desperately needed,” observes Tim Smith, Director of socially responsive investment at Walden Asset Management.

Critical steps in solving a trillion-dollar problem

Executives across the globe are very aware that the costs of corruption go far beyond fines and a temporary impact to reputation. Indeed, the costs are multifaceted, long-lasting and tragic.

Some corporations, like Enron, implode under the weight of malfeasance, taking employee livelihoods and pensions with them; while other companies, such as Tyco, survive but are substantially re-organized. Governmental agencies like Fannie Mae, as well as government contractors and suppliers such as BAE and Halliburton, see years of billing and business-development activities subjected to official inquiries. Employees become reluctant to stay with or join companies implicated in corruption scandals.

Companies that take corporate social responsibility (CSR) seriously—and their numbers are increasing—have to find ways to map large amounts of disparate data to large numbers of disparate stakeholders. As companies struggle to answer to these stakeholders, difficulties arise in collecting, processing, and publishing the desired information. Professionals who have dealt with substantial compliance or risk management initiatives understand the difficulties of trying to coordinate programs historically handled on a massive number of spreadsheets.

As with areas of corporate compliance and risk management, technology can play a critical role in making sense of CSR data.

Vendor execs offer views on GRC, CSR, sustainability applications

With the complex and overlapping GRC, CSR and Sustainability software markets shifting faster than the latest regulation or stakeholder campaign, CRO engaged C-suite officials from the top application providers and solicted their advice on what clients need to do, how the vendors’ companies can help them, and what the next “big things” will be. Their answers on a broad range of pertinent issues follow.

Awards to be presented at CRO Conference Oct. 29 in Chicago

CRO Magazine introduces its first CEO of the Year Awards Nominees 2008 to recognize the achievements of the all-star CEOs in Corporate Responsibility.

With the exception of the Mid Market Award, all 2008 CRO CEO of the Year Awards will be named live at the CRO Conference Oct. 29, 2008, at the Union League Club in Chicago. The Mid Market Award was named at the CRO Conference in San Francisco June 24.

U.N. office also lists 317 more participants at risk of removal from the initiative

The United Nations Global Compact Office removed 630 companies from its list for failure to communicate progress on the 10 principles of the initiative, the office said. Under the Integrity Measures introduced in 2004, companies must report advancements annually to stakeholders.

Evaluations of key impacts vital for setting strategy, bringing substantive changes

Materiality is a concept within the auditing and accounting fields relating to the importance of an amount, transaction or discrepancy. The objective of an audit of financial statements is to enable the auditor to express an opinion on whether the financial statements are prepared, in all material respects, in conformity with Generally Accepted Accounting Principles (GAAP). The assessment of what is material is a professional judgment.

Companies must define programs to maintain, manage global data

Over the past decade, an enhanced regulatory environment has emerged, which fundamentally impacts how global organizations handle enterprise data. Laws and regulations now mandate that companies manage their electronic and physical records more carefully. Additionally, businesses with global operations are now obligated to develop a standard for corporate compliance that reconciles domestic e-discovery and retention rules with foreign privacy-law requirements.

U.S. Attorney settles custom fraud case related to apparel made in China

The U.S. Justice Department and three apparel importers settled a customs fraud case that saw goods manufactured in China falsely labeled as made in Korea or Russia, and sold as such in the United States at Wal-Mart, JC Penney, Family Dollar Stores, Kohls and Marshalls stores.

The benefit to the subterfuge was that the importers—Intertex Apparel Group, J.J. Basics and Ben’s Clothing—could evade quotas on goods manufactured in China and dodge customs fees by under-valuing “the actual cost for those goods charged by the Chinese manufacturers,” according to the U.S. Attorney, Southern District of New York.