On May 26, 2021, the 26th lecture of "Weibo Law Lecture Hall" was held at the Law School. This lecture was given by Prof. Chen Ruihua of Peking University Law School. Prof. Feng Guo, Dean of Wuhan University Law School, Prof. Chen Lan and Prof. Zhan Shangang of Wuhan University Law School attended the lecture. The lecture was hosted by Prof. Qin Qianhong.

Prof. Chen Ruihua gave the lecture on the topic of "Corporate Compliance and Corporate Governance". He first introduced the background of corporate compliance with the "Siemens case" in 2016 and the "ZTE case" in 2018, and pointed out the broad prospect of corporate compliance and the current situation of scarce talents. He then gave a comprehensive explanation of the main functions, basic concepts, essential elements and incentives of the corporate compliance system.

Prof. Chen pointed out that the corporate compliance management mechanism has three main functions, which are cutting responsibilities, preventing risks and ensuring sustainable development of the enterprise. He elaborated on the concept of "corporate compliance", saying that it should refer to a system of corporate governance established by an enterprise to effectively prevent, identify and respond to possible compliance risks.

According to Prof. Chen, corporate governance faces risks such as strategic risk, investment risk, operational risk and compliance risk. Accordingly, an effective compliance programme should include four basic elements: First, a compliance charter, whereby companies should embody the basic concepts and requirements of compliance in the general charter or a specially formulated corporate compliance charter. Second, the compliance policy, which establishes different codes of conduct for different compliance risk points and compliance risk areas in the form of compliance management guidelines and employee handbooks. The third is the compliance organisation system, which should be established in accordance with the basic principles of independence, professionalism, authority and smooth communication. The fourth is the compliance procedure, which mainly includes prevention, identification and response procedures.

Prof. Chen believed that corporate compliance, as a form of corporate governance, must be activated with the help of external incentives in order to play a role in corporate compliance, which specifically include administrative supervision incentives, penal incentives and international regulatory mechanisms.

Prof. Chen Lan and Prof. Zhan Shangang gave their respective talks and they once again expressed their heartfelt gratitude to Prof. Chen Ruihua. Prof. Chen Ruihua answered questions from the audience on how to guide MSMEs in compliance building patiently and carefully. The lecture came to an end with applause.

Edited by Yuan Yuhang & Wu Liuqing