Save Millions or even Billions

Our Auditors  

Guarantees in life:  Death.  Taxes. Fines for misconduct.

Our view at ETHIC Intelligence is that you can guarantee that fines will be a mainstay within corporate business.  It is almost as guaranteed as the old saying about 'death and taxes'. 

Governments will keep charging companies fines for bad behavior and those fines will increase.

Twenty tears ago a large fine for a foreign corruption breach might have been, maybe, 3 or 4m dollars.  Now?  It more like 1-2 Billion.  A lot has changed in ten years and we are confident that it is not going to slow down as we move into the next ten or twenty years.  It is clear that fines are a significant reason not to engage in non-compliant behavior.  

Why the costs of compliance are always going to be smaller than the cost of fines.

Compliance costs in some companies are admittedly extremely high.  These are, however, quite limited to a few extra large banks that are extremely manual in their review and processing of transactions looking for 'non-compliance'. These are the outliers, and, while our argument probably still holds that the fines will be equally as high, we believe there is a more normal group to consider.

For the vast majority of companies, the costs of good (or, even GREAT) governance & compliance is never going to exceed the costs of fines.  In fact, the investment in GREAT governance & compliance is like an insurance policy.  Insurance is protecting against that catastrophic issue.  The smaller issues are less likely to actually claim on insurance and can be managed easily with likely minimal (if any) loss or costs of fines.  It is the catastrophic events that you are building your program to avoid.

For most companies the costs of compliance is made up of:

  • headcount, which typically is run fairly small and no where near the size of other functions (although, sometimes higher in cost due to the experience and backgrounds of the team)
  • Some support for headcount in terms of consultants, audits, certification bodies, or other support to validate and check the work being done
  • Some support from outside advisors, legal counsel or accounting to understand new obligations
  • technology, which is normally SaaS type solutions that are a minuscule amount of cost compared to what 'one server that IT buys every week'
  • some costs of travel, no more than any other executive and generally quite predictable
The above costs are well within the range of a typical operating group of a global company that focusses on the transition from good to great in their governance and compliance.


The costs can be catastrophic when things go bad.

While it is very hard to predict a set of fines without knowing the specific issues, legislation and the type of failure, the costs of failure can be in the millions, or billions.

  • criminal penalties could arise from some jurisdictions in some laws against the company and its executives.
  • civil penalties against the company by those affected
  • shareholder suits against the board or the company
  • fines for breaches charged by the country concerned (which could include many countries charging fines for the same activity)
  • investigation costs both internal and external
  • loss of key people and the costs of rebuilding teams
  • rectification costs are always more than what it would have been building the issue in the first place
  • executive time away from running the business and supporting customers
  • personal stress and discomfort
  • reputational damage to executives and the company
  • changes in ratings for ESG or changes from financial perspectives could inhibit lending or financing

It goes without saying that a small amount of investment could save potentially billions.