Corporate Governance & Compliance 

Compliance refers to a company's compliance with the applicable standards.

The development and maintenance of a compliance system reduces or prevents the danger of compliance risks, such as legal penalties, financial losses and damage to reputation. A compliance representative identifies and assesses compliance risks, informs the persons in charge and advises them regarding all matters related to compliance.

Obligatory or voluntary?

For banks and securities dealers, the development and maintenance of a compliance system is prescribed by supervisory law, while for insurance companies, a compliance system is only necessary where appropriate due to the scope and complexity of economic activity. Other sectors can decide independently whether to set up a compliance system. In practice, however, companies, clients, authorities - and not least employees - are increasingly con-sidering compliance to be a cornerstone of sound corporate governance and organization. These expectations, and the effort to reduce risks through good corporate governance, are leading more and more companies to voluntarily develop and maintain an effective compliance organization.

A compliance system may be linked directly to other areas (e.g. legal advising), or it may be outsourced or practiced on a part-time basis.

Compliance concept

The development and maintenance of an effective compliance organization requires the creation of a compliance concept. This concept defines the principles, duties and responsibilities related to compliance: from boards of directors, through compliance representatives and line managers, all the way to employees. A compliance concept also identifies the compliance topics that are important for a company, stipulates compliance reporting to executive committees and boards of directors, and regulates the compliance organization, for example through a Whistleblower/Reporting system. A compliance concept should also include interfaces with neighboring functions (risk management, legal advising, internal auditing).

Information on corporate governance & compliance:

Jürg Birri

Jürg Birri

Partner, Head of Legal German Switzerland

+41 58 249 35 48