Whether your organization is for-profit, not for profit, or a government entity, as part of its governing body you have a duty to determine what steps are being taken to meet its legal responsibilities. Included within this "duty of loyalty" is determining if a "reasonable reporting system" exists to provide you with information about the organization's compliance with the law. (See Stone .v Ritter, Del. Chancery Court, 2006) This may seem daunting, since no organization's regulatory responsibilities are a static set of rules.

In addition to this general duty the Boards of organizations settling matters with the federal government are finding a duty of "reasonable inquiry" into the effectiveness of the compliance program a condition of that settlement. For example, the Corporate Integrity Agreement agreed to by Abbott Laboratories in 2012 requires its Board to meet with the Chief Ethics and Compliance Officer at least four times a year and annually pass a resolution, signed by each member of the Board, attesting to the effectiveness of the compliance program. Mandatory training of Board members is also required.

Similarly, in 2010 the California Attorney General filed suit against a Monterey California AIDS charity and sixteen of its current and former board members seeking dissolution of the organization and recovery of funds that its Officers and Directors allegedly misspent. The complaint offers a good illustration of non-profit governance duties and responsibilities. "Reasonable inquiry" appears at least eight times. (The suit was ultimately settled in 2012 by a payment from the charity's insurer.)

All the pages in this wiki have resources that may help with that inquiry (For example, Compliance and Ethics 101, New In Compliance and Ethics), but the resources on this page are specifically directed to those who bear the ultimate responsibility for the organization's attempts to put together the "pieces" of compliance and ethics.

For example, here's a checklist for Director use in making a "reasonable inquiry" about a Compliance and Ethics effort: Most organizations orient and offer training for their Board members - is compliance and ethics part of that process at your organization?

Board Resources on the Web:

Orientation and / or Training:

Compliance Committee Charters:

Reporting to Boards:

Opinions about the Board's Compliance and Ethics Role:

SHARED by Toolbox members:

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