We have been getting accountability all wrong in the compliance profession. It’s not a set of tasks – it’s a way of thinking and it has to come from the heart as well as the head. On Accountability: The Heart of Compliance Tom Fox and Sam Silverstein dig into what accountability means to the corporate compliance function and business organizations and most significantly, how to make it an integral part of your culture. In this episode Sam and I begin a three-part series to consider the current disaster Boeing finds itself in from the accountability perspective and what it might do to crawl out of the deep hole it finds itself in. In this Part 1, we consider accountability from employees to their fellow employees and up towards management. Some of the highlights include:
· What is an employee’s commitment to values in an organization? What are your Foundational Values? Your Relational Values? Your Professional Values? Your Community Values?
· How employees commit to ‘it’s all of us’ so that all employees rise or fall together?
· Is bringing in a new CEO enough or must an organization do more?
· What is an employee’s commitment to a good reputation? How do you get alignment in word and deed to commit to accountability?
For more information on Sam Silverstein and his work on accountability, click here.
Will another Kleptocrat lose ill-gotten gains? Jay and I are back to consider some of the top compliance articles and stories which caught our eye this week. We give some final thoughts on the Astros sign stealing scandal, at least until the MLB Report on the Red Sox comes out.
- Africa’s richest woman, Isabel Dos Santos, accused of massive looting of Angola during her father’s reign. US companies under scrutiny for facilitating her looting, Michael Forsythe, Kyra Gurney, Scilla Alecci and Ben Hallman in the NYT. Her own bank fires her as a customer, Michael Forsythe in the NYT. PwC CEO warns ‘heads may roll’ over the firm’s work for Isabel Dos Santos, Larry Elliott and Graeme Wearden in Davos, and Juliette Garside in The Guardian.
- Tom wraps up his multipart series on the Astros sign stealing scandal; Part 4-The Truth of the Game, Part 5-the Whistleblower and Amensty and Part 6-the Scarlet C. Tom and Matt take a deep dive in this week’s Compliance into the Weeds.
- Mike Volkov takes a look at the year in OFAC enforcement. Part 1 and Part 2.
- How can you use the Benczkowski Memo internally? Jay explores in his CCI
- Latest Edleman Report shows trust going down. Matt Kelly explores in Radical Compliance.
- How does the DOJ draft new policies? Clara Hudson reports on Matthew Miner speech in GIR.
- Five men indicted in massive crypto-currency scheme. Jonathan Marks on the lessons learned in his Board and Fraud
- Lawyers from Skadden Arps compare and contrast UK and French guidance on cooperation. In NYU’s Compliance and Enforcement Blog.
- Was the SFO’s internal guidance a missed opportunity? Aziz Rahmen thinks so, in the FCPA Blog.
- On the Compliance Podcast Network, Tom continues his 31 Days to a More Effective Compliance Program series. 31 Days to a More Effective Compliance Program now has its own iTunes channel. If you want to binge out and listen to only these episodes, click here.
Tom Fox is the Compliance Evangelist and can be reached at tfox@tfoxlaw.com. Jay Rosen is Mr. Monitor and can be reached at jrosen@affiliatedmonitors.com.
In today’s edition of the Daily Compliance News:
- Angola: Where did all the money go? A 5-part series. (TheAfricaReport)
- The biggest tax scam ever? (NYT)
- How compliance can create better corporate culture. (WSJ)
- Harvard and Texas A&M in spat of article on health effects of eating red meat. (Houston Chronicle)
Cailyn and Amanda talk about the very basic tools for effective compliance management.
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Check out more episodes and full episode videos at ComplianceLine.com, and don’t forget to subscribe on your favorite podcast platform!
One of the critical elements found in the 2019 Guidance is the need to use the information you obtain, whether through risk assessment, root cause analysis, investigation, hotline report or any other manner to remediate the situation which allowed it to arise. It stated:
Evolving Updates – How often has the company updated its risk assessments and reviewed its compliance policies, procedures, and practices? Has the company undertaken a gap analysis to determine if particular areas of risk are not sufficiently addressed in its policies, controls, or training? What steps has the company taken to determine whether policies/procedures/practices make sense for particular business segments/subsidiaries?
Your company should establish a regular monitoring system to spot issues and address them. Effective monitoring means applying a consistent set of protocols, checks, and controls tailored to your company’s risks to detect and remediate compliance problems on an ongoing basis. To address this, your compliance team should be checking in routinely with local finance departments in your foreign offices to ask if they have noticed recent accounting irregularities. Regional directors should be required to keep tabs on potential improper activity in the countries in which they manage. These ongoing efforts demonstrate that your company is serious about compliance.
Three key takeaways:
- Innovation can come through a new way to think about and use data going forward.
- Have a plan in place to use the information garnered in your monitoring incorporated back into your compliance program.
- Always remember that Document Document Document is critical if the regulators come knocking.
Who needs more drama in their life? Anybody? Nobody! There is an upside to conflict, though. If you, or if people on your team, are dealing with conflict…it is possible to eliminate the conflict and come out with a stronger, better relationship – if you handle it correctly! As a leader, it is your responsibility to successfully navigate conflict and help your team to do the same.
In today’s episode we are digging into a how one top-recognized leader, Chris, uses an old school theory to help him and his team successfully navigate conflict. Chris and I are both millennials. But, no matter how young, how cool, how old, how smart you are…there are some things we will always be able to learn from the people who went before us.
We are discussing the Transactional Analysis theory developed in the mid 1900’s. This theory helps leaders understand why their people might think, act, and feel the way they do.
We’re going to walk you through how you can use this information to help in the trenches at work. Let’s dig in –it’s time to LEVEL UP!
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If your business would benefit from higher-performing leaders, check out more information about the comprehensive leadership development training I do HERE.
If you want to reach out to me directly, email alyson@vanhooser.com.
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Vince Walden welcomes Wendy Riggs and Kara Ricupero to the Walden Pond show. Wendy heads Information Governance and Legal Operations at Airbnb, and Kara is the Senior Global Director of Information Governance at Ebay. This week’s discussion revolves around the new communication and collaboration tools such as Slack, which are now widely adopted by organizations, and the unique issues and challenges they pose for information governance and compliance.
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The issue of data retention and review is one that is particularly problematic. With communication tools like Slack being used to share vast amounts of information, reviewing and holding on to potentially relevant data proves challenging. Kara says that it’s an all or nothing conundrum unless you bring in a separate legal hold tool. You can’t use the company’s automated deletion policy because you don’t know which channel may be relevant to litigation or an investigation. Wendy adds that putting governance around a tool like Slack is difficult from an architectural perspective.
Finding an effective solution to these governance issues is a matter of understanding your business. Work with your people to find the best defensible position for your company that also makes you compliant, Kara advises.
Resources
Wendy Riggs on LinkedIn
Kara Ricupero on LinkedIn
Control Testing – Has the company reviewed and audited its compliance program in the area relating to the misconduct? More generally, what testing of controls, collection and analysis of compliance data, and interviews of employees and third-parties does the company undertake? How are the results reported and action items tracked?
Fortunately, the Committee of Sponsoring Organizations of the Treadway Commission (COSO) 2013 Internal Controls Framework considers assessing compliance internal controls. In “Internal Controls – Integrated Framework, Illustrative Tools for Assessing Effectiveness of a System of Internal Controls”, COSO laid out its views on assessing the effectiveness of internal controls. It noted that an effective system of internal controls provides “reasonable assurance of achievement of the entity’s objectives, relating to operations, reporting and compliance.” Moreover, there are two over-arching requirements that can only be met through such a structured protocol. First, each of the five components are present and functioning. Second, that the five components operate in an integrated fashion with each other. One of the most critical components of the COSO Framework is that it sets internal control standards against those which you can audit to assess the strength of your compliance internal controls.
Three key takeaways:
- An effective system of internal controls provides reasonable assurance of achievement of the company’s objectives, relating to operations, reporting and compliance.
- There are two over-arching requirements for effective internal controls. First, each of the five components are present and function. Second, are the five components operating together in an integrated approach.
- For an anti-corruption compliance program, you can use the Ten Hallmarks of an Effective Compliance Program as your guide to test against.
In today’s edition of the Daily Compliance News:
- PwC CEO warns ‘heads may roll’ over the firm’s work for Isabel Dos Santos. (The Guardian)
- Dos Santos banned from her own back. (NYT)
- Vale ex-CEO charged with homicide over dam collapses. (WSJ)
- Warren wants DOJ task force to investigate Trump administration corruption. (com)