Google has agreed to spend $500 million over 10 years to revamp its compliance

Google has agreed to spend $500 million over 10 years to revamp its compliance structure as part of a preliminary settlement in shareholder litigation that accused the company of antitrust violations.

The settlement, which requires approval by U.S. District Judge Rita Lin in San Francisco, aims to create a standalone board committee to oversee risk and compliance, separate from the Alphabet board's audit and compliance committee. Additionally, a senior vice president-level committee will be established to address regulatory and compliance issues, reporting directly to Google CEO Sundar Pichai. A compliance committee will also be formed, comprising Google product team managers and internal compliance experts. The company did not admit wrongdoing in the agreement.

The shareholder litigation was led by two Michigan pension funds and accused Google executives and directors of failing in their fiduciary duties by exposing the company to antitrust liabilities in its search, Ad Tech, Android, and app distribution businesses. The lawyers for the shareholders said the reforms would bring about a "deeply rooted culture change" and are among the largest by a company to fund regulatory compliance committees.

This settlement comes as Google faces ongoing scrutiny over its market power, with Judge Amit Mehta in Washington considering how to address the company's search monopoly. The case highlights the increased pressure on tech companies to improve their compliance and risk management practices in the face of growing regulatory scrutiny.
Reuters