In particular, the risks to which a company is exposed influence the design of a compliance management system. In the professional world, the expert also speaks of risk landscape, risk situation or risk exposure.
Procedure for compliance risks
To set up a compliance management system, we recommend the following approach: after identifying the risks, these are evaluated. The risks were split into company specific and general. Specific risks concern industry, size, market position as well as important stakeholders such as shareholders. There are also general risks that affect all companies. Risk management is closely interwoven with the corporate strategy.
In particular, the risk-related areas in each business area must be identified and measures to reduce liability for the company and avoid liability in favour of the management body (in particular managing directors, management board, supervisory board) implemented.
Third-party risk related to compliance
Systematic investigations and evaluations of Group companies are part of the prophylaxis of a company against compliance risks. Risk management can be carried out on the basis of the results.
A company is not only liable for the behaviour of its own employees, but also for the behaviour of subsidiaries or business partners and suppliers. The limits of a company are softened by these connections. The expert speaks of a third-party risk arising from group companies, suppliers, subcontractors or joint venture companies.
One way to identify, prevent, and ultimately reduce risks is to conduct risk-based due diligence audits on business partners.
Corporate privilege and antitrust law
Antitrust prohibits restrictive agreements between competitors such as agreements on prices, price changes and calculations, as well as on bidder and bid behaviour in tenders. The purpose of antitrust law is fair and uniform competition.
However, companies associated with each other enjoy the Group privilege. Internal agreements do not constitute an antitrust offence. Thus, the antitrust law does not apply to sins such as price agreements as long as they take place among related companies. For large companies, cartels and mergers are attractive. In the case of joint ventures, it is crucial for a risk analysis to determine how the groups are assigned and linked.
From a antitrust perspective, accurate observation is important for assessing compliance risks. The importance of compliance increases with antitrust risks.
Jurisdiction
In the individual cases of compliance, the relevant legal areas include in particular the following areas:
- Company law
- Bank law
- Competition law
- Product liability law
- Insolvency law
- Data protection law
- Environmental legislation
- Employment law compliance
- Insurance law
It goes without saying that after identifying the risks, we create the legal measures of a compliance management system for your specific companies individually and e.g. also a Whistleblowing Hotline In this context, I would like to make a few comments. Ggfs. can also be certified according to IDW PS 980 standard.