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Presidential Leadership Lessons for the Business Executive

Leadership Lessons from the Presidency of Rutherford B. Hayes

This episode begins a short series on Gilded Age Presidents, now largely forgotten. In this episode, we take up Rutherford B. Hayes and try to mine the issues he faced for some leadership lessons for the 21st-century business executive. Some of the problems we consider include:

1. Hayes Educational and Professional Background

2. The Disputed Election of 1876 and Compromise-(1)Election Commission; (2) Terms of the Compromise, and (3) Was it necessary?

3. Hayes’ Presidency-(1) Reconstruction ends-was it inevitable? (2) Civil Service Reform; (3) Cabinet Selections; (4) Port of New York; and (5) the Post Office.

a. Foreign Policy-(1) Paraguay War settlement; (2) Mexican border crisis; and (3) Immigration issues.

b. Great RR Strike of 1877, the Great Western Tour, his Indian Policy and Lemonade Lucy

4. Hayes Leadership Issues-

(1)“He serves his party best, who serves his country best.”;

(2) Rutherford the Rover;

(3) Use of veto and

(4) Conflicts with Congress over Congressional v. Executive Power.

Categories
Daily Compliance News

August 4, 2022 the Bain Barred edition

In today’s edition of Daily Compliance News:

  • What’s the cost of a data breach? (Third-Party Trust)
  • AG to investigate companies that evaluate ESG. (Reuters)
  • Bain was barred from working for the UK government. (FT)
  • Former Mexico President under investigation for money laundering. (France24)
Categories
Blog

Would You Buy a New Car From Them? Part 2 – Lessons for Compliance

Over this series, I am reviewing the corruption enforcement action Involving the company formerly known as Chrysler Group LLC, now FCA US LLC (Chrysler or the company herein) which was criminally sentenced to pay a fine of over $96 million and a forfeiture money judgment over $203 million. These amounts were above a previous civil penalty of $310 million. All of this was for designing a vehicle emissions system for the company’s Jeep Grand Cherokee and Ram 1500 that would evade federal emissions standards for diesel vehicles and then lying about it to federal authorities. It was a different type of corruption from a Foreign Corrupt Practices Act (FCPA) enforcement action but corruption, nonetheless. Today, I want to consider some of the lessons for the anti-corruption compliance professional.

The actions by the company are instructive for what not to do in any corruption investigation. The Plea Agreement specified that the company did not receive credit for self-disclosure as it did not self-disclose its criminal conduct or fraud. The company did receive some cooperation credit for cooperating during the scope of the investigation but did not receive any credit for failures in both taking timely remedial action and for failing to discipline senior executives who were involved in or had knowledge of the criminal action and fraud. (Recall that one executive involved directly in the fraud was with the company until 2020.)

All these actions were very costly to the company in terms of how it was evaluated under the US Sentencing Guidelines. Under Section 8(C)2.5(g)(2) a company can receive credit of up to five (5) points for cooperating in the investigation and affirmatively accepting responsibility for it’s conduct. The company only received a two (2) point discount. Since the Plea Agreement specified the company did cooperate in the investigation, it clearly did not accept responsibility for its conduct. The lack of those three points in discount cost the company somewhere in the estimated range of $20 to $30 million in additional fines and penalties.

The Plea Agreement also specified for the first time the Monaco Doctrine of evaluating past conduct as a part of the overall evaluation of the company. The Plea Agreement detailed that the company had a prior criminal conviction for bribery and corruption under the National Labor Relations Act (NLRA) for bribing union officials. However, it is not clear how that worked into the overall fine and penalty except to note that the company paid the maximum under the US Sentencing Guidelines, after credit for the civil penalty.

Additionally, while there is no requirement for a monitor in this resolution of the criminal action, there was a such a requirement in the Consent Decree from the civil action. It mandated an Independent Compliance Auditor for a period of three years from the resolution of the civil matter, which was May 2019.

Lessons Learned

There are multiple lessons for the anti-corruption compliance professional from this enforcement action. Obviously, the need to engage in robust remediation for the matter at issue and your compliance program is critical. Moreover, and once again the Department of Justice (DOJ) criticized a company for tardiness in disciplining those who were involved in the fraud or those who were aware of it. As I noted in Part 1, multiple former company employees were criminally indicted for their conduct in this sordid affair. Yet some of them were with the company until 2019 and 2020 and not all were terminated, some left the company in voluntary separations, which sounds suspiciously like retirements. Such actions could save your organization literally millions of dollars.

One of the clearest, which was not stated in any of the resolution documents, was that every Chief Compliance Officer (CCO) needs to read the newspapers and stay abreast of current events in their industry. It was September 2015 that the Volkswagen (VW) emissions-testing scandal became public. It was by far the largest scandal in emissions-testing and cost VW billions in investigative and remediation costs, fines, penalties, buy-backs, market share loss and reputational damages. To say that anyone at the company was not aware of it is to simply defy belief.

Beyond just the CCO, every Board member was no doubt aware of the VW emissions-testing scandal. Under the current state of the Caremark Doctrine, there may well be a duty to make an inquiry by the Board of auto manufacturers to senior management to investigate if they have been involved in similar conduct. Here we do not know how the scandal got to the attention of the DOJ, but it was clear from the Plea Agreement, it was not from self-disclosure. CCOs and Boards need to be much more proactive when competitors get into trouble about investigating similar products or services which could lead to criminal and civil fines and penalties.

This matter warrants consideration by every CCO in every US public and private company. Every CCO can also use the case as instruction and training for both senior management and their company Board of Directors.

Resources

DOJ Press Release

Information

Plea Agreement

Consent Decree from the civil action

Categories
Blog

Tribute to Vin Scully

In this special blog post, I want to pay tribute to the greatest baseball play by play announcer during my lifetime, Vin Scully, who passed away yesterday at age 94. According to his obituary in ESPN.com, Scully called Brooklyn and later LA Dodger games for 67 years, starting in the 1950s and moved with the team to Los Angeles in 1958. He called some of the most memorable plays in baseball along the way with the two most notable being Hank Aaron’s 715th home run and Kirk Gibson’s 1988 World Series Game One walk off homer (I don’t believe what I just saw.) He also called the complete game of Sandy Kofaux perfect game, Mookie Wilson’s single which went through the legs of Bill Buckner, breaking the hearts of all New England in 1986 and to my eternal regret the game-ending touchdown throw by Joe Montana to Dwight Clark in the 1981 NFC Title Game, which ended the Dallas Cowboys 1970s dynasty.

Tim Erblich sent me the following quote from Bob Costas which appeared in an ESPN tribute to Scully from 2016, “”Somewhere around 1994, ’95, I was interviewing Ray Charles for an NBC news magazine and probably spent a couple of hours talking with him. … Then, when we’re done and the cameras had been turned off, he says to me, ‘You know who I would really like to meet?’ And I’m thinking, ‘He’s Ray Charles. He could have met just about anybody he’d wanted to have met throughout the course of his life. Who might it be?’ … ‘Vin Scully.’ And I say, ‘Why?’ And he says, ‘Well, because I love baseball. But you have to understand, to me the picture means nothing. It’s all the sound. And Vin Scully’s broadcasts are almost musical, so I enjoy baseball so much more listening to him.’ … So I set it up with Vin and took Ray to Dodger Stadium. I was sitting across from Ray, and there was an empty seat awaiting Vin’s arrival, and Vin came walking through the door wearing — as I remember — a royal blue jacket, the way he is always turned out for a baseball broadcast. And as he walked toward Charles, he said, ‘Ray, my name is Vin Scully, and it’s a pleasure to meet you.’ He might as well have said, ‘A pleasant good evening to you wherever you may be,’ because that’s how it struck Ray. And then they sat down, and we had a combination baseball and music discussion. Vin had a nice experience. And Ray Charles — and I mean this sincerely — he’s Ray freaking Charles — I believe he had one of the great experiences of his life.””

Scully was more than the Dodgers play by play guy; he was America’s play by play guy. He could make the sights, sounds and statistics of a baseball game sing with color. He put his love of the game into each call so that you could see the beauty of each pitch and each swing of the bat. While there have been many tributes to Scully, the one I want to salute comes from life-long Dodger fan Adam Turteltaub who said “Summers here will be a lot quieter.” Farewell Vin Scully.

Vin Scully Great Calls (from YouTube)

Hank Aaron 715

Kirk Gibson Walk off

Mookie Wilson Single

Montana to Clark

Field of Dreams Poem

Categories
Trekking Through Compliance

Episode 54 – Bread and Circuses

In this episode of Trekking Through Compliance, we consider the episode Bread and Circuses, which aired on March 15, 1968, and occurred on Star Date 4040.7.

On a routine patrol, the Enterprise happens upon space debris from the S.S. Beagle. This survey ship disappeared 6 years ago, commanded by Captain R.M. Merrik, an academy associate of Kirk. When Spock projects the path of the wreckage back in time, he discovers a civilization of modern-day Romans on Planet 4 of the 892 System. The extreme similarity of the 892 System’s civilization to the Roman Earth is apparently a coincidence, demonstrating, according to Kirk, the validity of Hodgekin’s Law of Parallel Planet Development.

Scott prepares to disrupt power to the entire planet from the Enterprise just as Kirk is about to be executed on live Roman TV. Scotty beams up the away team just before their cell is crisscrossed with machine gun fire. Back aboard the Enterprise, Uhura discovers that the escaped slaves were not sun worshippers but worshippers of a different “son”: the Son of God.

Compliance Takeaways:

1.     Being a CCO or compliance professional requires many soft skills.

2.     Do you translate your compliance documents into the local language?

3.     Does your compliance program enhance and enrich cultural diversity in your organization or acerbate the differences?

Resources

Excruciatingly Detailed Plot Summary by Eric W. Weisstein

MissionLogPodcast.com

Memory Alpha

Categories
Jamming with Jason

From Both Sides Now

There are two sides to every story, and in this #jammingwithjason #podcast, we dig into Joni Mitchell’s great song “Both Sides Now.” Why? If you think you know everything or are only looking at things from one angle, chances are you aren’t seeing the whole picture.

And when you don’t see the whole picture, that leads to confusion, misunderstandings, arguments, or staying stuck in a very narrow point of view.

Wisdom really comes from realizing the more we know, the less we really know, as we see from both sides.

FOR FULL SHOW NOTES AND LINKS, VISIT:

E283 From Both Sides Now

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If you’re the kind of person who likes to help others, then share this with your friends and family. If you found value, the will too. Please leave a review [https://itunes.apple.com/us/podcast/jamming-with-jason-mefford/id1456660699] on Apple Podcasts so we can reach more people.

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OTHER RESOURCES YOU MAY ENJOY:

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STAY UP TO DATE WITH NEW CONTENT:

It can be difficult to find information on social media and the internet, but you get treated like a VIP and have one convenient list of new content delivered to your inbox each week when you subscribe to Jason’s VIP Lounge at: https://jasonmefford.com/vip/ plus; that way, you can communicate with me through email.

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Greetings and Felicitations

Winnie the Pooh Explains Compliance: Part 3 – Eeyore, Compliance & Legal

This week I am exploring a five-part series on compliance as seen through the lens of Winnie the Pooh and the characters who live in the Hundred Acre Wood. In this Part 3, we consider perhaps the most beloved character (other than Pooh himself) Eeyore and use him to explore the differences in compliance and corporate legal.

Eeyore is described as an “old grey donkey”. Eeyore has a poor opinion of most of the other animals in the Forest, describing them as having “No brain at all, some of them” and “only grey fluff that’s blown into their heads by mistake” (from chapter 1 of The House at Pooh Corner). Eeyore’s favorite food is thistles. He lives in the southeast corner of the Hundred Acre Wood, in an area labeled “Eeyore’s Gloomy Place: Rather Boggy and Sad” on the map in the Winnie-the-Pooh book. He has a stick house therein called The House at Pooh Corner. Pooh and Piglet built it for him after accidentally mistaking the original house that Eeyore built for a pile of sticks. On Eeyore’s birthday, he is given an empty honey jar from Pooh for keeping things in, a popped red balloon from Piglet to keep in the pot, and a note from Owl. (Eeyore’s birthday was originally celebrated by University of Texas students in Austin and is now a worldwide phenomenon.)

Eeyore expects misfortune to fall upon him, accepts it when it does, and rarely even tries to prevent it. He is known for saying “Thanks for noticin’ me” and “Ohhh-kayyy”. His grumpiness is best shown in an encounter with Piglet, who cheerfully bade him, “Good morning!” Eeyore responded, “Well, I suppose it is…for some.” Yet, Eeyore is capable of great compassion. Most interestingly, he has a great friendship with Tigger.

I use Eeyore as an introduction to the differences in the compliance function and the legal department in the corporate world. When I initially went in-house, it was made clear to me that the role of the in-house department in the company I worked for was to protect the company. When I became a General Counsel (GC), I took that role to heart and felt like I was the company’s lawyer (even if the Chief Executive Officer (CEO) felt like I was his lawyer). But as Donna Boehme pointed out, there are distinct differences in approaches to compliance from practicing law. She said, “one thing is clear – the two functions have very different mindsets, mandates and priorities.” She notes that the legal department’s mandate is to “advise and protect the company.” The compliance mandate is much broader.

The bottom line is that while you may want an Eeyore in the corporate legal department, just saying no; that is not something you want in compliance. The job of compliance is not to protect the company at all costs. Instead, it is to prevent, detect and remediate any compliance issues that arise. You cannot do that by simply saying No. Yet, just like Eeyore, the corporate legal department can be a valuable adjunct to the compliance function if an internal investigation occurs and you want to maintain your corporate privilege.

Join me tomorrow when I take a look at Piglet and the role of payroll in compliance.

Categories
The Hill Country Podcast

Nancy Huffman-Nature Journaling

Welcome to the award-winning The Hill Country Podcast. The Texas Hill Country is one of the most beautiful places on earth. In this podcast, Hill Country resident Tom Fox visits the people and organizations that make this a unique area of Texas. Join Tom as he explores the people, places and activities of the Texas Hill Country. In this episode, I have local Hill Country Artist Nancy Huffman. Highlights include:

·       When did you become interested in art?

·       What fueled your passion for art as an adult?

·       How long have you been pursuing art full time?

·       What types of work do you specialize in?

·       What is a “contemporary impressionistic style”?

·       As an artist, what draws you to the Hill Country landscapes?

·       What is Nature Journaling?

·       How can a writer, blogger or podcaster participate in Nature Journaling?

For more information on Nancy Huffman and her art, click here.

Nancy Huffman on Instagram

Categories
Great Women in Compliance

Sarah Powell – Remember the Why

Welcome to the Great Women in Compliance Podcast, co-hosted by Lisa Fine and Mary Shirley.

Today’s guest is Sarah Powell. Sarah is the kind of person who makes everyone around her stronger. Her work in ethics and Compliance is directly related to her commitment to social justice and making a positive impact through anti-bribery and anti-corruption work. Lisa can vouch for that as she works with Sarah as Global Compliance Counsel, Director, Third-Party ABC Compliance at Pearson.

Sarah returned to her home in South Africa from London at the beginning of the pandemic and had her daughter. She discussed how both of these events had impacted her. In particular, she talks about some of her experiences during quarantine, how they showed the resilience in South Africa and how the pandemic could also breed corruption.

She also shares her views on what those of us outside South Africa can learn from their experiences, particularly how they talk about the past and issues. This episode is a great reminder of why we do this work and how we can directly influence society as a whole.

Are you planning on heading to the SCCE CEI in Phoenix in October? Check out Lisa and Mary’s speaking sessions on the agenda and sign up! We invite you to say hello and introduce yourself during the conference it’s going to be a great time.

The Great Women in Compliance Podcast is on the Compliance Podcast Network with a selection of other Compliance-related offerings to listen to. If you enjoy this episode, please rate it on your preferred podcast player to help other like-minded Ethics and Compliance professionals find it. You can also find the GWIC podcast on Corporate Compliance Insights, where Lisa and Mary have a landing page with additional information about them and the podcast’s story. Corporate Compliance Insights is a much-appreciated sponsor and supporter of GWIC, including affiliate organization CCI Press publishing the related book” “Sending the Elevator Back Down, What We’ve Learned from Great Women in Compliance” (CCI Press, 2020).

You can subscribe to the Great Women in Compliance podcast on any podcast player by searching for it, and we welcome new subscribers to our podcast.

Join the Great Women in Compliance community on LinkedIn here.

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Compliance Into the Weeds

Internal Controls Lessons from Cyber Failures in Wisconsin

Compliance into the Weeds is the only weekly podcast that takes a deep dive into a compliance-related topic, literally going into the weeds to more fully explore a subject. In this episode, we deep dive into recent failures detected in the state of Wisconsin regarding cyber security risks around election integrity. Highlights include:

  • The risks were uncovered.
  • What is a material risk?
  • Why Multi-Factor Authentication is important cyber security control.
  • What are the consequences of a single point of failure?
  • How and when should redefine a hazard?
  • What does CISA say about MFAs?

Resources

Matt in Radical Compliance