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Assessments and Confidentiality

A threshold issue which often arises in conducting C&E program assessments is to what extent the process and report should be treated as confidential. There are two components to this question, the first of which concerns the use of the company’s attorney-client privilege and the second providing assurance to interviewees that – absent exigent circumstances – their comments will not be shared even with others within the company, a form of protection that goes beyond that offered by the privilege.

As to the first question, there is clearly a benefit to conducting a privileged assessment, given the litigation/enforcement risks posed by the type of self-critical information that an assessment often generates. When employees fear that comments made in assessment interviews might be used by their companies’ adversaries, they are presumably less likely to be candid in providing important information about the C&E program. That, in turn, can lead to a less meaningful assessment.

However, the mere involvement of attorneys in an assessment will not, by itself establish the privilege. Rather to have a privileged assessment, the process must in fact involve a lawyer providing legal advice to the client company. In that connection, one should document from the outset that the purpose of the assessment is to review the extent to which the company’s program a) meets pertinent legal expectations and b) otherwise helps reduce legal risks (the way a best practices program can.) Of course, advice along these lines must actually be provided in connection with the assessment.

Additionally, to maintain the privilege one must a) instruct employees to keep the contents of their assessment interviews confidential; and b) after the assessment is complete, keep the assessment report confidential (although the specifics of this – e.g., how much internal disclosure is permissible without risking waiver – will be a function of applicable state law, at least in the U.S.)

Thus, a company may be limited in the extent to which it can share a favorable review of its program. Any assessment conducted with an eye toward publicizing the results of the effort should presumably not be conducted under the privilege.

We have also seen substantial benefits in providing assurances to interviewees that – absent exigent circumstances (which would likely include a government investigation) – their comments will not be shared even with others at the company. Particularly when seeking information about sensitive matters – e.g., whether the CEO and other senior leaders really “walk the talk,” discipline is sufficient for violations, and the company does a good job assessing and responding to risks – assurances of this sort may be essential to obtaining accurate information.

Finally, documentation of the assessment should anticipate disclosure – whether inadvertent or through a waiver of privilege (for instance, in a government investigation). Thus, one should attempt to be highly confident of factual findings and recommendations before finalizing a report – including, at least in most situations, reviewing these in draft with key client personnel to assure accuracy of not only the reported facts but also the underlying assumptions in the report.

Posted in Methodologies

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