Principles of Legal Compliance

The Principles of Legal Compliance are:

1. Commitment
2. Ownership
3. Demonstrable (Transparency)
4. Comprehensive
5. Systematic
6. Ongoing Development

To find out what each principle represents and encompasses refer below:

1. Commitment: There must be a commitment to an effective legal compliance process by local elected
members, management and staff.  The local authority's commitment to compliance should be publicly
recorded in a clear and unequivocal manner.  
The commitment to legal compliance should be manifested in approved policies and in the accountability
demanded from the Chief Executive.  The commitment to legal compliance should be part of the culture of
the local authority.

2. Ownership: Legal compliance, and the processes which underpin it, are to be owned by all persons within
the local authority. 
While there will be varying roles and responsibilities for different people within the local authority, it is
important that the elected members, Chief Executive and all staff have a clear understanding and ownership
of the objectives and process of legal compliance.  The ownership by elected members will be manifested
through policy statements on legal compliance and ensuring the Chief Executive has compliance systems in
place. The ownership of the Chief Executive will be recognised by taking primary responsibility to ensure
that local authority's commitment is realised. This is usually brought about through the development and
implementation of formal compliance systems.  All staff of the local authority should be encouraged, through
formal and informal means, to recognise the importance of legal compliance in their daily work and to,
collectively and individually, contribute to a culture of compliance.

3. Demonstrable (Transparency): Local Authorities are public bodies. Their legal compliance framework
and processes should be developed in an open transparent manner, be available to the public, with periodic
reporting to the public on legal compliance processes and outcomes.
The legal compliance framework and process should be open to public scrutiny. While the framework
and processes may be developed by staff and management, they should be submitted to, and discussed
in an open Council meeting before adoption.  As part of the local authority's accountability to its
stakeholders, two forms of reporting are necessary to demonstrate the legal compliance process is working as
intended. The first accountability is from management to the local authority, and the second accountability
is from the local authority to the general public.  The accountability of the local authority to the public
regarding legal compliance could be incorporated as part of a statement of governance and risk
management in the annual report. Internationally, such statements are an increasingly important component
of Boards of Directors annual reporting to shareholders.  It is likely that the bulk of the legal compliance
procedures and programmes which underpin the framework will remain in-house, as they are technical
and procedural documents which are unlikely to be of interest to the public.

Comprehensive: The local authority's legal compliance processes should embrace legislation and case law as
well as a clearly defined ambit of other standards, codes of practice or other authoritative pronouncements.

The legal compliance process must embrace:

• Acts of Parliaments, including Public Acts; and Local and Private Acts which apply to local
  authority all statutory regulations;
• Case law;
• Local authority by-laws;
• Regional and District Plans;
• The extent to which other authoritative pronouncements are included in the legal compliance process
  is a decision for each local authority to make. However local authorities must clearly define the types
  of authoritative pronouncements which will form part of their legal compliance;
• Authoritative pronouncements which could form part of legal compliance include:
  • standards issued by Standards NZ
  • codes of practice issued by reputable national or representative bodies
  • charters or customer agreements.

Systematic: There must be a systematic approach to support and sustain legal compliance activities. The
systematic approach should be embedded into existing management systems. 
Whenever possible legal compliance systems and processes should be embedded within management systems
within local authority. Legal compliance systems are a fundamental part of good management and therefore
should not be seen as a "bolt on" task unrelated to normal business.  Legal compliance systems should also
form part of the local authority's integrated risk management processes. The NZ handbook of Risk
Management for Local Government (SNZ 4360: 2000)  includes legal compliance as one of the seven core risk
management activities of local government.  To support and sustain legal compliance there must be formal
systems put in place which cover training, written procedures (programmes), action plans, complaints
handling, assignment of roles, monitoring, reporting and record-keeping.  Each of the elements of the
systematic approach are further elaborated below.

• Training: Relevant staff to acquire knowledge of legal environment relevant to their activities, and their part
  in the legal compliance process.
• Compliance Programmes: Covering the full range of local authority activities; Written in plain language;
  Tailored to functions; customised to suit the circumstances of relevant staff; Updated regularly; Capable
  of providing certification or assurance that "builds" upwards within the organisation.
• Action Plans: Provide a springboard for subsequent action, treatment or remedies; provide
  guidance for amending
  or streamlining future compliance programmes.
• Complaints Handling: Procedures for handling complaints from staff, ratepayers, service users,
  or community groups
• Roles and Responsibilities: Appointment of a legal compliance co-coordinator; Inclusion of legal compliance
  responsibilities in job descriptions; Roles of local authority external legal advisors and insurance agents
• Monitoring: Regular, in-house quality assurance procedures; Review of completed compliance programmes;
  Classifying and investigating compliance failures.
• Reporting: Tiered reporting structure that reports more important issues to local authority and management;
  Regular confirmation that compliance systems are being maintained; Regular reporting on effectiveness
  of procedures and instances of non compliance.
• Record Keeping: Nature and type of records to be kept; Confidentiality / security of sensitive material;
  Availability for insurers and legal advisers.

Ongoing Development  - A programme of continuous improvement will ensure that the objectives
of legal compliance remain relevant, and its effectiveness will be heightened.
Legal Compliance will only be effective if it is kept relevant and fresh, with continuous attention to address
newly emerging issues as well as streamlining existing compliance processes.  Development through staff
training is an important element. This should include:

• Legal compliance as part of induction programmes for new staff;
• Staff attending internal or external workshops on specific areas of law or application of the law;
• Briefing by local authority's legal advisors;
• Networking with other local authorities.

Legal compliance training should be integrated with the local authority's professional development
programmes for each member of staff. The legal compliance process will be enhanced if the local authority
has ongoing liaison with its legal advisors, insurers, risk consultants and regulators. The aim will be to anticipate
and manage issues while they are still on the horizon.  Such liaison should be regular and proactive, particularly
with insurers and legal advisors. Where possible local authority should also seek to comment on draft
legislation or codes of practice, not only from the standpoint of the efficacy of the legislation, but also from
the compliance perspective. In addition to the regular in-house quality assurance as part of the systematic
approach to legal compliance, periodic external assessment should be conducted of local authority's approach
to legal compliance.

The aim of the reviews is to see that the objectives of the legal compliance approach are being met,
that designed procedures in place are adequate to meet the objectives, and that the designed procedures
are happening and not becoming stale.  An important aspect of ongoing development is to ensure that
administrative procedures improve as a result of the legal compliance programmes. If there are issues
emerging, identifying how these can be translated into different ways of working.