Source: JD Supra

In an article published by JD Supra, Michael Volkov explores the reasons why many data-driven corporate compliance programs fail to effectively persuade government regulators, such as the Department of Justice (DoJ), of their efficacy. While the integration of data analytics into compliance is a significant and positive development, there is a growing tendency for companies to rely too heavily on quantitative metrics alone. Volkov argues that this over-reliance can lead to what he terms "the failure to persuade." Regulators are increasingly skeptical of compliance programs that present a vast array of statistics—such as the number of employees trained or hotline reports received—without providing the necessary context or qualitative evidence to support the numbers. The core issue is that data, in isolation, cannot fully capture the nuances of a company's ethical culture or the genuine commitment of its leadership to compliance.

Volkov emphasizes that a persuasive compliance program must weave a compelling narrative that blends both quantitative and qualitative evidence. This means going beyond simple metrics to demonstrate how the compliance function operates in practice. For instance, instead of merely reporting the number of investigations conducted, a company should showcase the quality and thoroughness of those investigations, the resulting remedial actions, and the lessons learned that were integrated back into the program. The author suggests incorporating real-world examples, case studies, and testimonials to illustrate the program's impact on employee behavior and decision-making. Ultimately, the goal is to show regulators not just that compliance activities are happening, but how they contribute to a living, breathing culture of integrity within the organization. This holistic approach is far more likely to convince the DoJ that a company's compliance program is truly effective and not just "compliance theater."