Campbell on Compliance

May 20th, 2015 / By Deborah J. Merritt

Compliance is one of the “hot” alternative jobs that law schools are promoting for their graduates. Much of this discussion, unfortunately, pays little heed to the nature of compliance jobs and whether legal education really prepares students to do this work well. The two seem to fit. After all, compliance is all about obeying the law, and JDs know a lot of law. The equation, though, isn’t that simple.

Law and Compliance

Ray Worthy Campbell explores these issues as one part of a rewarding new paper, The End of Law Schools. Although the title is provocative, and Campbell warns law schools of continued upheaval in the profession, the paper’s thesis is forward looking and upbeat. Campbell urges law schools to reinvent themselves as “schools of the legal professions.”

As part of that analysis, Campbell offers the best discussion I’ve seen of the difference between compliance and traditional law practice. His insights parallel those I’ve heard from contemporary general counsels, which is not surprising since Campbell has extensive practice experience. Educators who are contemplating the addition of compliance courses to the law school curriculum, or who just want to understand this area, should read Campbell’s exposition carefully.

Lawyers, as Campbell explains, tend to assume that compliance requires simply “explaining what the law require[s], and leaving it up the client to hew to the law.” P. 48. But today’s compliance officers are more about the “hewing” than the “explaining.” Naturally, a compliance officer has to understand the legal requirements affecting a company. Legal education can help with that foundation although, as Campbell points out, law schools pay more attention to broad legal principles than to “chapter and verse” of tedious regulations.

More important, understanding the law is just the starting point for an effective compliance officer. Big corporate scandals don’t arise from misreading the law; they often stem from behavior that all participants know full well is illegal. Did Walmart executives mistakenly think it was legal to bribe foreign government officials–or to cover up the evidence of those acts? See p. 49. No one needed a law degree to figure that one out.

Compliance Essentials

Instead, effective compliance officers need a host of knowledge and skills that law schools don’t touch. Necessary background includes “an understanding of how individuals work within a corporate culture, how leaders in an organization can inspire compliance, and [how to] identify[] those points in a business process most likely to lead to risks.” P. 49. “[T]racking, documenting and motivating employee behavior” are also essential. Id.

In addition to these basics, which infuse all compliance work, a compliance officer needs to understand her company’s business. It’s hard to achieve environmental compliance if your last science class was in high school. Ditto for privacy without some knowledge of computer programming. Almost all of the compliance fields require good accounting and math skills. Law students with STEM-phobia are not good candidates for most compliance positions.

Thinking Like a Compliance Officer

Compliance officers thus need education in fields outside the legal mainstream. Too many traditional law classes, meanwhile, may create the wrong mindset for compliance. Law schools hubristically assume that “thinking like a lawyer” is the best mental tool for any task. Traditionally educated lawyers, however, take a surprisingly narrow approach to problems.

Faced with a regulation, a lawyer’s first instinct is to find loopholes–ways for the client to avoid any unnecessary burdens. If there are no loopholes, then the lawyer will consider challenging the regulation in court. Did the agency follow proper procedures when adopting the rule? Did Congress give the agency sufficient authority in this area? Does the regulation raise constitutional issues under the nondelegation doctrine?

These lawyerly questions are appropriate under some circumstances. Indeed, any company faced with a burdensome regulation might ask its lawyers to explore these possibilities. But that’s lawyer work, not compliance.

Compliance requires a very different mindset: Now that we’ve established the validity and scope of these regulations, how do we go about obeying them? A lay person would be surprised to learn that we rarely view the law from that perspective in law school. Yet, as Campbell’s discussion reveals, this is not surprising at all. Effective compliance requires close reading of regulations and (sometimes) cases, but many college graduates can accomplish that task. Once one knows what the law requires, compliance requires very little manipulation of legal principles.

Educating Compliance Officers

Given the differences between law and compliance, Campbell predicts that law schools will not dominate compliance work simply by graduating traditional JDs. Some JDs will find work (and satisfaction) in that field, but the conventional path is both expensive and unsuited for compliance work. Instead, other programs are emerging that focus specifically on compliance careers.

Some of these programs are in law schools, some are in other departments. Some offer degrees, others provide certificates. Some encompass a year or more of work, others span only a few days. Some are online, others are face-to-face. As compliance continues to spawn job opportunities, preparatory programs will blossom. To what extent should law schools participate in that growth?

Campbell notes that law schools cannot educate effective compliance officers by simply packaging part of the current curriculum. Creating meaningful compliance education will require schools to add new fields of study while reshaping conventional ones. That process, Campbell suggests, could form part of the rebirth and expansion of law schools into “schools of the legal professions.” He urges schools to follow that path.

I wholeheartedly agree with Campbell that law schools need new faculty, fields of study, and pedagogic approaches to teach compliance effectively. Excellent education in that field will not be cheap. It will also stray from the single-minded focus that law schools have maintained for generations: the study of appellate opinions as a way of preparing graduates to handle legal disputes.

Broadening the focus of law school would be healthy for many reasons. In addition to allowing schools to enter the compliance field, it would expand our notion of lawyering to encompass the many types of work our graduates already do. Campbell’s vision of a school of the legal professions is very appealing.

Independence or Collaboration?

On the other hand, refashioning law schools as Campbell suggests will be a daunting task. Rather than attempt to create these programs within existing colleges of law, perhaps we should forge truly collaborative degrees with other units on campus.

Academia has long depended upon silos. Degrees belong to particular units, who jealously guard both the stature and revenue generated by those degrees. Interdisciplinary work is painful, as deans are reluctant to share their faculty’s teaching and scholarly capital with others. Despite their rhetoric, provosts and presidents often structure the university’s budget to reward just this type of turf protection.

Recently, however, I’ve seen signs that the old ways may be relaxing. In areas like environmental protection, neuroscience, and data analytics, universities seem to be willing to create truly cross-college programs. Committees of faculty drawn from all participating units govern these programs, which seem more genuinely devoted to meeting student needs than engaging in the horse trades that marked earlier interdisciplinary efforts.

I haven’t participated personally in any of these ventures, so I don’t know how optimistic to be. Despite my recent pessimism about aspects of legal education and the profession, I have an innate tendency toward optimism. (Really. My son calls me Miss Enthusiasm.) Perhaps this type of academic collaboration is illusory. But the stories I’ve heard suggest that there may be a new attitude emerging on campuses.

If so, then a cross-campus collaboration could be the perfect way to create a highly regarded program in compliance. With participation by law, business, organizational psychology, medicine, sciences, and other units, universities might already have the capacity to create stellar programs in this area. No unit would reap as much revenue as it might from an in-house program, but no unit would bear all the costs of building and maintaining such a program.

Maybe it’s time for creative destruction, not just in legal education, but in university structure.

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