Survey points to both risks and benefits posed by third-party ethics-program requirements

Companies are growing ever more dependent on relationships with third parties. In an effort to control some of the risks created by third parties, many organizations have extended certain compliance and ethics standards or requirements to at least some categories of the third parties with which they have relationships. To enable companies to benchmark their policies and procedures against those of other organizations with respect to third-party adherence to corporate ethics and compliance standards, The Conference Board and the Ethics and Compliance Officer Association conducted a survey of senior ethics and compliance officers during February-May 2007, canvassing the practices of 169 companies with respect to third-party compliance standards. When asked about the greatest challenges in establishing high standards of third-party business conduct and monitoring for compliance, company responses suggest both satisfaction with current methods and an openness and willingness to search for new approaches. Nonetheless, the legal and reputational fallout from third-party misconduct is likely to be a growing problem.