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Compliance Officer Portal - Compliance and the
Board of Directors
Case Study:
Lockheed
Martin Corporation
Special
Committee Charter - Qualified Legal Compliance Committee
Powers And Duties: The Board of Directors by resolution adopted by a majority of the Board of Directors pursuant to Section 3.06 of the Bylaws has provided for, as a special committee, a Qualified Legal Compliance Committee, within the meaning of Part 205 of the Rules of the Securities and Exchange Commission (“Securities and Exchange Commission Rules”). The Committee shall consist of three or more directors, at least one of whom shall be a member of the Audit and Ethics Committee, and all of whom are not officers or employees of the Corporation and are free from any relationship that, in the opinion of the Board of Directors, would interfere with the exercise of the independent judgment of each member as a Committee Member. The members of the Qualified Legal Compliance Committee shall be elected by the Board of Directors to serve at the pleasure of the Board of Directors. The Qualified Legal Compliance Committee shall designate a chairman from among its membership. The Qualified Legal Compliance Committee shall: Follow the procedures set forth below for the confidential receipt, retention and consideration of a report of evidence of a material violation of an applicable United States federal or state securities law, a material breach of fiduciary duty arising under United States federal or state law, or a similar violation of any United States federal or state law (a “material violation”): - If an attorney appearing and practicing before the Securities and Exchange Commission in the representation of the Corporation becomes aware of evidence of a material violation, the attorney may report such evidence to the Committee. In addition, the General Counsel of the Corporation (who is the chief legal officer under the Securities and Exchange Commission Rules) may refer a report of evidence of a material violation to the Committee. - Any report of a material violation to the Committee shall be made in the first instance to the Chairman of the Committee by direct communication, either in person or by telephone, through the Corporate Secretary or, if she is not available, through the General Counsel. If it is an exigent matter and the Chairman of the Committee is unavailable, then the Corporate Secretary or the General Counsel may report the matter to another member of the Committee. - Promptly after receiving a report of evidence of a material violation, the Chairman or other member who received the report shall convene a meeting of the Committee to consider the report and any action to be taken in response to the report. The Committee shall hold such additional meetings as it deems necessary to carry out its responsibilities in responding to a report. - The Committee shall maintain written minutes of all meetings in which it considers a report of evidence of a material violation. The minutes are protected by the attorney-client and work product privileges and will be marked with a restrictive legend reflecting that protection. The minutes shall be maintained separately from other Committee or Board minutes. - Reports to the Committee by an attorney or the General Counsel will be subject to the attorney-client privilege. The Committee will maintain the confidentiality of these reports, except to the extent the Committee deems it necessary to disclose such reports or related information in carrying out its functions under this charter and the Securities and Exchange Commission Rules. Authority And Responsibility: To inform the General Counsel, the Chief Financial Officer, and the Chief Executive Officer of any report of evidence of a material violation (except where the Committee believes that such a report would be inappropriate in light of the evidence of a material violation report); To determine whether an investigation is necessary regarding any report of evidence of a material violation by the Corporation, its officers, directors, employees or agents and, if it determines that an investigation is necessary or appropriate, to: - Notify the Audit Committee or the Board of Directors; - Initiate an investigation, which at the direction of the Committee may be conducted either by or under the direction of the General Counsel or by outside counsel retained by the Committee; and - Retain such additional expert personnel including outside counsel as the Committee deems necessary; and At the conclusion of such investigation, to: - Determine whether a material violation has occurred, is ongoing, or is about to occur; - Recommend, by majority vote, that the Corporation implement an appropriate response to evidence of a material violation; - Recommend, by majority vote, that the Corporation assert a colorable defense in any investigation, or judicial or administrative proceeding relating to evidence of a material violation; and - Inform the General Counsel, the Chief Financial Officer, the Chief Executive Officer, and the Board of Directors of the results of any such investigation and the appropriate remedial measures to be adopted. The Committee shall also have the authority and responsibility acting by majority vote, to take all other appropriate action, including the authority to amend this charter and to notify the Securities and Exchange Commission, in the event that the Corporation fails in any material respect to implement an appropriate response that the Committee has recommended the Corporation to take. ------------------------------------------------------------------------------------------------------------------------------------------------------------------------ 
Case Study: The Norinchukin Bank (www.nochubank.or.jp)
Along with
the rise in public demands for protection of customers, financial
institutions have been obliged to place greater emphasis on
accountability to stakeholders in the conduct of their activities
and work toward substantially increasing the sophistication and
effectiveness of their compliance frameworks.
In
addition, in view of the scathing public criticism of corporate
improprieties, the issue of creating better and more effective
compliance frameworks has been moved to the top of the management
agenda.
Especially
for financial institutions, the very existence of which rests on
effective compliance to maintain the trust and confidence of the
general public, and particularly their customers, there is no
exaggeration in mentioning that proactive compliance initiatives
are necessary for securing the basis of corporate survival.
As a core member of Japan’s financial system and as a nationwide financial institution of cooperative credit businesses, the Bank is committed to fulfilling its basic mission and social responsibilities and taking full account of changes in the social and management environment to respond to the trust of its customers and members. To this end, the Bank is complying fully with rules and regulations based on the principle of self-responsibility and is constantly working to achieve highly transparent management emphasizing proper disclosure and accountability. The Bank is fully aware that strict adherence to compliance requirements in its day-to-day activities is particularly important for the conduct of its operations. Accordingly, in July 2005, the Bank created its Compliance Division by assigning specific staff from the Legal Division to this new organizational unit. The Bank’s compliance framework is composed of the Compliance Committee, the Compliance Division (which is in overall charge of compliance activities) and the compliance supervisors and other personnel responsible for compliance in its divisions and branches. The Compliance Committee (chaired by the Deputy President & Co-CEO) was created as a unit reporting directly to the Board of Directors that is responsible for considering basic issues and policies related to compliance. Items discussed by the Compliance Committee are then placed on the agenda and reported to the Board of Directors. The Compliance Division, as the compliance control unit of the Bank, acts as the secretariat for the Compliance Committee and serves as the contact point for and provides advice to the compliance supervisors and other personnel in charge of compliance stationed in each division and branch. In its compliance monitoring, the Division also provides guidance directly in interview meetings with general managers of branches and divisions as well as other managerial personnel. Other functions of the Division include providing lecturers for compliance workshops, as well as conducting compliance related education and training programs within the Bank for all personnel. The Division has also established the Bank’s Compliance Hotline, which enables employees to receive advice from and to provide information to the Compliance Division and outside legal counsel. This hotline has been arranged to provide full protection from negative repercussions to those who provide information on compliance matters. Compliance Program Each fiscal year, the Bank formulates its Compliance Program to serve as the agenda for the execution of compliance measures that are aimed at systematically incorporating compliance as an integral part of Bank operations. The items covered by the Compliance Program include the upgrading of the compliance framework and compliance promotion and awareness activities. Additionally, individual divisions and branches establish their own compliance programs that contain specific policies for carrying out ongoing compliance activities. ----------------------------------------------------------------------------------------------------------------------------------------------------------------------- |
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