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Risky business: BAE’s compliance head to direct risk at Rolls Royce as Lord Gold’s monitor role comes to an end

BAE Systems compliance and regulation chief counsel Mark Serfozo has moved to Rolls-Royce as director of risk after nearly 20 years at the defence, security and aerospace giant in a move said by BAE’s high profile general counsel Philip Bramwell to be ‘a good career move’.

Serfozo was appointed to head compliance in 2007 as part of Bramwell’s move to beef up that function shortly after his arrival at BAE and during the height of long running investigations by the Serious Fraud Office into the al-Yamamah arms deal.Since then, the compliance function at BAE has quadrupled to around 100 staff and the legal team doubled to 250, while the company’s litigation costs have dropped by 80%.

Serfozo will be replaced by BAE’s global head of dispute resolution Joanna Talbot, who he has worked closely with to identify trends that give rise to disputes in order to troubleshoot at an early stage.

During his time at BAE, Serfozo and his team put together training packages to educate BAE’s 106,000 employees on a new principles-based compliance policy, under which they must take responsibility for compliance and are required to make an informed judgment on issues such as the receipts of gifts.

Rolls-Royce engines power major planes from Concorde to Airbus and it operates in all major defence aircraft sectors. The company has a good safety record but in June this year the Australian Transport Safety bureau found the mid-air failure of one of its Trent 900 engines was responsible for the emergency landing of a Qantas Airbus A380 flying over Batam Island in Indonesia in 2010.

Bramwell said: ‘We were of course sad to lose Mark as a colleague, but he looks to be making a good career move into another fascinating industry, which is one of the great opportunities afforded by an in-house career.

‘It’s not all bad news for a legal department when lawyers move on, provided that you have established appropriate succession plans. We have developed a very strong bench within the BAE Systems legal team and Joanna Talbot, formerly our global head of dispute resolution, has now taken on the compliance and regulation role after working through a very orderly period of transition alongside Mark.’

The move comes as BAE enters a new chapter heralded by the end of the three-year appointment of Lord Gold as BAE corporate monitor. Lord Gold – formerly senior partner at legacy Herbert Smith – was appointed as part of the 2010, £286m agreement negotiated by Bramwell with the SFO, under which he would review the effectiveness of the company’s internal controls, record keeping and existing or new policies and procedures. His appointment comes to an end next month.