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This is the first in a series of posts about the many new compliance obligations contained within the recently signed, recovery Act, formally called the American Recovery and Reinvestment Act. The initial posts will not focus on the expected reforms related to new rules for executive compensation at companies taking government bailout money but instead will highlight lesser known new policy reforms on data protection and privacy, healthcare, taxes, and corporate whistleblowers. Part One looks at how the law expand's HIPAA scope and the the compliance risks associated with breaches of Protected Health Information or PHI. To enhance enforcement, the Act also makes HHS audits of HIPAA-covered companies mandatory and requires investigation of privacy and security rule related complaints. Although we can describe the rough contours of the changes based upon statutory language the HIPAA provisions also will be subject to rulemaking that will determine more exactly how challenging managing the new reforms may be.

New research by Wharton School Management Professor Maurice Schweitzer and three colleagues documents how ambitious corporate goal setting can cause more harm than good. Moreover, he concludes that not only is it overprescribed but it helps to drive destruction of an organization's ethical culture increasing risk and corruption.

The Caux Round Table is an international network of experienced business leaders, who work with business and political leaders to design the intellectual strategies, management tools and practices to strengthen private enterprise and public governance to improve our global community.

This is the first in a series of "Thinking About Risk" posts directed at improving business processes among the growing number of government contractors facing the new federal compliance requirements which include mandatory disclosure regulations.

Non-Disclosure Agreements (NDAs) have become a ubiquitous part of doing business with the government and with other government contractors. Yet the proliferation of NDAs may have actually increased the risk of failure to protect and safeguard truly sensitive information such as trade secrets. While the use of NDAs provides evidence of an intent to comply with non-disclosure requirements, we must ask whether their overuse--often driven by an abundance of caution and the desire to assure the availability of a legal defense should it become necessary-- actually increases risk by undercuttting the true value of such instruments.

The systemic erosion of ethics and responsibility in business and individual decision-making has brought the world economy to a virtual standstill. Algorithmic risk management designed to ignore real world problems, short-term profit driven decisions, extremist free market fundamentalism, and shareholder primacy at the expense of other stakeholders, have divorced business leadership from standards of good faith, wise stewardship and care for the public interest.

Trust the essential element of credit-based market transactions has become a rare commodity. Indulgence in the race-to-the-bottom, profit-at-all-costs, instant gratification mentality of the entitlement culture, can no longer be cloaked in terms of capitalism and the free market. The blame for where we are can be shared by everyone in government and industry who acted only in their immediate self-interest and in apparent belief that the bubble would never burst. Is it any wonder that a recent Washington Post story was headlined, The End of American Capitalism?

Join the Ethos ECE Group on LinkedIN

This is an online collaboration group for Ethics, Environmental, Compliance and Corporate Responsibility professionals interested in cross domain networking and sharing ideas to address better the issues of what Tom Friedman in Flat, Hot and Crowded calls the new Energy Climate Era (ECE). Love Friedman, or hate him, his ideas are worth considering.

Welcome are thought leaders and experts in related fields from not-for profit, for-profit, non-governmental and governmental organizations engaged in understanding positive sustainable change locally and globally.


Please join the discussion.


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The Past is a Foreign Country:Old Rules+New Technologies = Surprising Risks

L.P. Hartley, the English author, once memorably wrote that “The past is a foreign country; they do things differently there.”


I am not yet old enough to collect Social Security retirement benefits. When I attended law school and entered into the practice of law, people appearing to talk to themselves as they walked down the street were considered deranged; Bluetooth was a temporary dental problem resulting from eating fruit; Blackberries were a fruit; Google was the misspelling of a very high number; cells were places in jails where criminal clients were detained; Shepardizing a case involved red paperback books; and Spam was a canned pink gelatinous substance that pretended to be meat.

Not long ago, I responded to a comment about fraud and misconduct not being reported, with reflections on the history of the defense industry and the Qui Tam amendments to the 1986 U.S. False Claims Act. This week, in ALLISON ENGINE COMPANY, INC., et al., PETITIONERS v. UNITED STATES ex rel. ROGER L. SANDERS and ROGER L. THACKER, the U.S. Supreme Court made news when it voted unanimously in favor of restricting the whistleblower provisions of the False Claims Act. The bottom-line appears to be that whistleblowers will not be rewarded, if they cannot prove the false claim was a key factor in the Government's decision to make payment.

Probably good law, but not good sense.