|
Tuesday, December 07, 2004
By naming compliance officers, companies are putting new focus on regulatory issues -- and giving CFOs a break.
There's a new seat at the management table these days, much to the relief of many CFOs. Largely in response to Sarbanes-Oxley, companies have begun to formalize the compliance role, creating a function dedicated to the watchdog tasks that have previously fallen to finance.
In fact, according to Maria Schafer, senior program director at Meta Group Inc., some 35 percent of Global 2,000 companies surveyed have someone other than the CFO heading up compliance today. And they're not just mutual-fund companies, which are now required to staff the role thanks to their industry scandal, or other companies that have run afoul of the Securities and Exchange Commission — although Computer Associates was only the most recent company to name a compliance officer as part of its settlement with the SEC.
Carved-Out Territory At The Men's Wearhouse Inc., a $1.4 billion clothing chain based in Houston, Sarbox prompted the creation of the CCO position, but the growth of the business also revealed the need for a designated compliance head. "The timing was good for us because of the overall increase in the complexity of our business," says CFO Neill Davis, noting that the company now has three retail concepts and others in development, yielding many more employees, business units, and transactions to monitor.
To formalize the role, Davis worked with the audit committee and former chief accounting officer Gary Ckodre to design a position that turned out to be perfect for Ckodre. Now the former Deloitte & Touche audit partner and 11-year company veteran spearheads the overall Sarbox effort and oversees the newly formed internal audit group, which has primary responsibility for Section 404 compliance. The overlap with finance, however, is unquestionable. Ckodre and Davis insist they have almost a symbiotic relationship. "He knows what I do, and I know what he does," says Davis. "Our offices are two doors down," adds Ckodre.
At other companies, however, the CCO oversees everything but Sarbox. At Arrow Electronics Inc., an electronic-components and computer-products distributor based in Melville, New York, general counsel Peter Brown was the lead designer of the compliance officer role, which the company created last summer. Compliance chief Wayne Brody, who spent 20 years in the company's legal department before moving into the top compliance job, is largely focused on education and coordination of the compliance efforts of the $8.7 billion company's staff around the world. He also takes responsibility for risk assessment, antitrust and competition issues, and employee relations. Sarbox work, however, "rests with the CFO and his organization," says Brody, who reports to Brown.
posted by Anonymous @ 8:38 AM
 
0 Comments:
<< Home
|
|
