Board & Executive Communication Flashcards

Attorney-client privilege over compliance communications to the board is BEST preserved when:

Answer: Legal counsel directs the investigation and communications are marked as attorney-client privileged

Privilege requires that legal counsel direct the work and communications be properly labeled and limited in distribution.

A board director contacts the CCO directly to request a personal briefing on a regulatory matter before the full board meeting. The CCO should:

Answer: Consult with the board chair and general counsel before conducting an individual briefing

Pre-meeting briefings with individual directors can create information asymmetry; coordination with leadership ensures appropriate governance.

Which of the following BEST describes the 'duty to inquire' concept relevant to board compliance oversight?

Answer: Directors must ask probing questions when red flags suggest compliance weaknesses

The duty to inquire requires directors to probe deeper when warning signs emerge, rather than accepting management's assurances passively.

An executive team proposes reframing a compliance failure as a 'process improvement opportunity' in the board report. The CCO should:

Answer: Insist on accurate characterization of the failure while noting corrective actions

Accurate reporting of compliance failures is required for board oversight; sanitizing failures undermines directors' ability to fulfill their governance role.

How often should a compliance officer present a comprehensive program update to the full board, at minimum?

Answer: Annually, with interim audit committee updates as needed

Best practice calls for at least annual full-board compliance updates, supplemented by more frequent audit committee engagement.

When communicating a newly identified compliance gap to the executive team before board reporting, the CCO should FIRST:

Answer: Assess severity, document findings, and present a preliminary remediation plan to leadership

Internal documentation with a remediation plan allows the executive team to respond constructively before formal board escalation.

A board member asks why the compliance budget increased 30% year over year. The BEST response from the CCO includes:

Answer: Specific drivers such as new regulations, headcount additions, technology investments, and cost-benefit outcomes

Boards expect compliance spending to be justified with specific drivers and demonstrated value, not general references to complexity.