Precisely in these times of crisis, compliance is key
What will be the economic fallout of the coronavirus crisis? Eric Schuiling, Consultancy and Secondment Manager at The Netherlands Compliance Institute, anticipates an impact on compliance departments. He stresses that especially in times like these, compliance is essential.
“While the 2008 crisis originated in the financial industry, the coronavirus crisis is a far broader crisis and essentially a unique event,” explains Schuiling. “For the first time in human memory, economies have been consciously shut down to protect public health. Whether it was SARS, AIDS, yellow fever, or the swine flu pandemic, the economy always kept going before. This also makes it difficult to predict the impact of the Netherlands’ intelligent lockdown. But given the fact that the Dutch economy is highly interwoven with the global economy, it is certain that we will be affected, in all industries. This is the kind of crisis that makes companies switch to survival mode because that’s how serious it is: Can we survive, and if so, how?”
“To put it plainly, it boils down to ‘operating within your means’,” Schuiling continues. “That means that if there’s no money coming in, the costs will have to come down as much as possible. And so, cost-cutting measures are launched, whereby staff costs are a major component of the operating expenses in many industries. All non-core functions at a company are also closely scrutinized. What do all those consultants actually do? Which operations can we close down and which ones do we need to keep up and running? Compliance departments, too, will be subjected to such critical scrutiny: does the department still contribute enough to keep the ship afloat?”
Compliance is particularly relevant in times of crisis
“But it is a misconception that compliance is a luxury,” according to Schuiling. “Cutting the compliance budget would be a major mistake. Compliance officers, therefore, need to stick with it now more than ever. After all, standing firm is an essential aspect of the definition of integrity, alongside meticulousness and accountability. And integrity is what should continue to be the central focus, also in these times of crisis. What is our purpose on this earth as a company? And to what extent do we currently meet our customers’ needs? Which (integrity) risks continue to be topical or may even have become more relevant? These are the questions that need addressing in this crisis, and that touch on a company’s core values. The compliance officer must do his or her bit in this respect. And he or she has the scope to do so because compliance has long ceased to solely be about ensuring laws and regulations are complied with: it is about strengthening integrity. And it is precisely in this discussion that, especially in times like these, the compliance officer can be the one who makes the difference.”
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