Technical compliance with applicable laws is necessary, but so is meeting their spirit and putting investors’ interests first. Otherwise, small problems stack up and become big ones. Determining a firm’s list of priorities can prove difficult, particularly in a short amount of time. Looking at a firm through the eyes of the legal and compliance function, however, can offer some valuable clues.
Here’s a list of questions that can help identify the status of the legal and compliance role. None are fatal; few firms have all the best answers. But in the aggregate, enough bad answers can be telling.
• Does the firm have an individual whose sole role is legal/compliance? If not, how does that compare with peer firms?
• If the CCO is dual hatted, what other role(s) does the CCO perform? Does the dual-hatted CCO have meaningful compliance experience? What efforts does the dual-hatted CCO take to stay informed about regulatory developments?
Coming Up: A few final questions to ask when assessing the status of the legal and compliance role.