The Rule of Law and the Corporate Compliance

IBA Rome

I. Intro. In October 2018, as I attended the International Bar Association’s (IBA) Annual Conference, I came across a discussion on the Rule of Law (Ukraine’s equivalent is the principle of the Supremacy of Law, which I believe is not much admired in practice). During Opening Ceremony, which took place in a charming brand new conference center La Nuvola in Rome, the IBA President Martin Solc emphasized: “As guardians of the Rule of Law, lawyers understand when it is suppressed and forgotten. Society falls under the uncontrollable Rule of Individuals with vested interests and ultimately, dictators.

Further, he showed the delegates two of eight short videos dealing with different elements of the Rule of Law leaving the audience curious to check the other six. To save you the effort, I share links to all eight videos below. They are less than one minute each but speak louder than thousands of words: (1) Rule of Law – Introduction, (2) Prison, (3) Discrimination, (4) Independent judges, (5) Free speech, (6) Bribing, (7) Freedom of press, (8) Independent lawyers. Please pause here and watch them before you continue reading. I find it hard to select my favorite but I would like to know which one you liked the most.

II. The concept. Now, it seems that lawyers realized their role to promote the rule of law. The motto of the campaign - “Look after the Rule of Law and it will look after you” makes a lot of sense – hopefully not only to lawyers. But what the Rule of Law is and what it is not? Let me give you a brief explanation.

During the last day of the conference, at the session called the Rule of Law Symposium, Ian McDougall, the EVP and General Counsel of Lexis Nexis gave a splendid speech on the Rule of Law topic. According to him, there are four components of the Rule of Law: (1) all are equal under the law, (2) transparency of laws, (3) independent judiciary, and (4) accessible legal remedy. I will not spend time describing the components, but if you are interested, you can check out his 60 minutes speech at Harvard Law School here).

Rule of Law

To conclude with the definition, I would like to underline Mr. McDougall’s distinction between the Rule of Law and Democracy, and Rule of Law and Human rights. Indeed, although some older initiatives like World Justice Project or the United Nations’ papers would like to mix and include either Human Rights or Democracy or both as the component of the Rule of Law. But this vagueness and absence of uniformity creates the unwanted confusion with understanding the Rule of Law across the world, and weakens it positions to “look after you”. Human rights standards are different across the globe, and Democracy is perhaps not the only effective form of governance, but according to Ian McDougall the Rule of Law is rather common across the globe (if we define it as 4 components mentioned above).  

III. The intersection. You might be wondering why I am so passionate about the Rule of the Law concept and decided that this topic is worth sharing on Compliance Periscope, which focuses on compliance-related topics. The reason is quite obvious. The Rule of Law deals with something very similar to what compliance program does. The difference is that the first concept (Rule of Law) is universal to all humans while the second (Compliance Program) is specific to businesses. It is like a parent and a child relationship: the supremacy of laws in a state and the supremacy of policies and procedures in a corporation. Both the Rule of Law and Compliance Program do not give judgement if the law is good or not, they simply stand for compliance. Dura lex sed lex is a famous Latin expression meaning that you have to comply with either good or bad law.

IV. Conclusion. Finally, you may ask, how come this theoretical discussion can have a practical application. In my view, the job of compliance officers in corporations is very much similar to what the institutions like IBA do at a national and international level. Compliance officers can get the concepts, ideas and materials, adapt them and use them in their day today work. For example, you can show the videos that I shared about discrimination, corruption and the rule of law at your training sessions, having tailored them to the relevant context and you will create the right emotional effect of your audience.

I hope the above was helpful and until next time. Cheers.

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Pavlo is a regional Legal Head with a global pharmaceutical company. He leads Legal function in CIS & Romania as a part of Emerging Markets business region.

He got his LL.M. degree in International Business Law from Tilburg University, the Netherlands. He also graduated from Ukrainian university with a Master degree in Business Law.

Pavlo is an attorney at law admited to Ukrainian Bar, and a certified compliance professional (CCEP-I). Pavlo has been recognised in 2016 as the best Compliance Officer by one of the most reputable Ukrainian legal publisher (Yuridicheskaya practica).