Miller, G. P. (2014). The compliance function: an overview.

Question 1

What is the primary purpose of the corporate compliance function?

Answer 1

To ensure that firms and their employees obey applicable laws, regulations, and norms through internal monitoring and control — effectively acting as a form of internalized law enforcement.

Question 2

What are the “Three Lines of Defense” in corporate compliance?

Answer 2

1. Operating units (line staff and managers)
2. Compliance & risk officers (monitoring and guidance)
3. Internal audit (independent oversight)
   Other oversight actors include boards, external auditors, and regulators.

Question 3

Why has the compliance function become so important?

Answer 3

Due to the rise of the administrative state, globalization, and increased liability exposure, firms now face greater pressure to proactively prevent legal and ethical violations.

Question 4

What are key elements of a robust compliance program?

Answer 4

Clear policies, strong “tone at the top,” employee training, risk assessments, monitoring, whistleblower protections, and independent audit functions

Question 5

What is “compliance beyond the firm”?

Answer 5

Firms are now expected to enforce legal and ethical standards in their supply chains, business partners, and global operations — e.g., conflict minerals reporting and anti-bribery compliance