Welcome to the Daily Compliance News. Each day, Tom Fox, the Voice of Compliance brings to you compliance-related stories to start your day. Sit back, enjoy a cup of morning coffee, and listen in to the Daily Compliance News. All, from the Compliance Podcast Network. Each day we consider four stories from the business world, compliance, ethics, risk management, leadership, or general interest for the compliance professional
Tom Fox and Jonathan Armstrong, renowned expert in cyber security, co-host the award-winning Life with GDPR. The recent controversy surrounding Nigel Farage’s banking situation highlights the risks and compliance challenges faced by the banking industry in relation to data protection.
In this episode, Tom and Jonathan discuss the closure of Farage’s bank account with Coutts, a high-end bank owned by NatWest, and the potential data breach that ensued. They discuss the risks of internal emails being exposed through subject access requests (SARs) and emphasize the importance of caution in email communication. The conversation also explores the cost and consequences of non-compliance with GDPR obligations, particularly in relation to SARs. The potential legal implications for banks that violate their own policies or delete data that should be provided in response to a SAR are highlighted. Overall, the episode underscores the need for banks to prioritize data protection, compliance, and proper decision-making in the financial industry.
Key Takeaways:
· Nigel Farage’s Banking Controversy
· Data Protection Risks in Banking
· The Cost and Consequences of Subject Access Requests
· Serious concerns about data protection and access to banking
Resources
For more information on the issues raised in this podcast, check out the Cordery Compliance, News Section. For more information on Cordery Compliance, go their website here. Also check out the GDPR Navigator, one of the top resources for GDPR Compliance by clicking here.
Connect with Tom Fox
Connect with Jonathan Armstrong
Zig Ziglar Said “I Believe Man was designed for accomplishment, engineered for success, and endowed with the seeds of greatness.” Kenneth O’Neal carries this tradition forward in his work and in this podcast, The Circle of Gumption, as he shows how maximizing your God-given talents and abilities leads to a successful, well-balanced existence in all areas of life. Join co-hosts Tom Fox and Kenneth O’Neal as they explore The Circle of Gumption to help change your life mentally, spiritually, physically, financially, and professionally by improving the health of your relationships with others and yourself.
The COVID-19 pandemic has undoubtedly brought about unprecedented disruption across industries, but amidst the chaos lies a unique opportunity for businesses in the United States. In a recent podcast conversation between Tom Fox and Kenneth O’Neal, they shed light on the importance of adopting the right mindset to approach this opportunity. By prioritizing employees and embracing a leadership mindset, businesses can navigate through these challenging times and emerge stronger than ever. We will delve into the key insights shared in the podcast and explore practical ways to seize the opportunities presented by this disruption.
The conversation between Fox and O’Neal revolves around the notion that disruption, such as that caused by the COVID-19 pandemic, can be a catalyst for growth and innovation. Rather than viewing it as a setback, businesses should embrace disruption as an opportunity to reimagine their strategies, products, and services. By reframing our mindset, we can start to see the silver linings and leverage them to our advantage.
O’Neal emphasizes that now is an outstanding time for great opportunities. He encourages business owners, managers, and entrepreneurs to adopt a growth mindset, which involves embracing challenges, persisting in the face of setbacks, and seeing failures as learning opportunities. By cultivating a growth mindset, leaders can inspire their teams to think creatively, adapt to change, and seize new opportunities that arise during times of disruption.
One crucial aspect emphasized in the conversation is the significance of prioritizing employees and treating them as valuable assets. O’Neal suggests that businesses should shift their focus from micromanaging tasks to empowering and coaching their employees. By doing so, leaders can create an environment that fosters innovation, collaboration, and employee growth. This approach not only boosts employee morale and productivity but also cultivates a sense of ownership and loyalty within the organization.
Rather than trying to do all the work themselves, managers, owners, and entrepreneurs should embrace the role of a leader and coach. This involves providing guidance, support, and mentorship to their teams, enabling them to thrive and reach their full potential. By adopting a coaching mindset, leaders can unlock their employees’ hidden talents, encourage autonomy, and foster a culture of continuous learning. This approach not only empowers employees but also allows leaders to focus on strategic decision-making and driving the business forward.
The COVID-19 pandemic has undeniably caused disruption, but it has also presented businesses with a unique opportunity for growth and innovation. By adopting the right mindset, prioritizing employees, and embracing a leadership and coaching role, businesses can navigate through these uncertain times successfully. Now is the time to seize the opportunities that arise from disruption, reimagine strategies, and empower our teams to thrive. Let us embrace this challenge as a chance to excel and emerge stronger, together.
Highlights Include
· Disruption as an Opportunity
· Power as a Grow Mindset
· Prioritizing Employees
· A Coaching Mindset
Resources
Tom Fox
One of the ways to operationalize compliance and to drive it into the DNA of an organization is through a performance review. Indeed, the 2023 ECCP stated:
Incentive System…Have there been specific examples of actions taken (e.g., promotions or awards denied) as a result of compliance and ethics considerations? Who determines the compensation, including bonuses, as well as discipline and promotion of compliance personnel?
Most HR experts will opine that properly executed performance appraisals are crucial to organizational productivity as well as the development of employee skills and employee morale. Moreover, they can serve a couple of different functions for a best practices compliance program. First, and foremost, they communicate to each employee their job performance from a compliance perspective.
However, one key is not to approach the performance appraisal review as an isolated event but rather a continual process. This means that instead of trying to play catch-up at the last minute, supervisors should provide feedback and assess job performance throughout the year so annual reviews are grounded in a year’s worth of experience. This includes the compliance component of each job. The second area performance appraisals impact is compensation. The DOJ expect that your compliance program will have both discipline and incentives. But those incentives need to be based upon something. The score or other performance appraisal metrics will provide to you a standard which you can measure and use to evaluate for other purposes such as employee promotion or advancement to senior management going forward.
Three key takeaways:
- To incentivize compliance, you must be able to accurately appraise senior managers and employees around compliance.
- Clearly communicate your compliance expectations, then fairly evaluate employees on them.
- Consider conducting an ongoing review.
For more information, check out The Compliance Handbook, 4th edition here.
Welcome to the Daily Compliance News. Each day, Tom Fox, the Voice of Compliance brings to you compliance-related stories to start your day. Sit back, enjoy a cup of morning coffee, and listen in to the Daily Compliance News. All, from the Compliance Podcast Network. Each day we consider four stories from the business world, compliance, ethics, risk management, leadership, or general interest for the compliance professional.
- Binance files for Protective Order against SEC. (Decrypt)
- Compliant filed over required religious liberty training. (Reuters)
- Federal corruption investigation heating up in Ohio. (Ohio Capital Journal)
- SEC Whistleblower Program growing pains. (WSJ)
Another area where Human Resources can help to more fully operationalize compliance is in succession planning. Succession planning is just as important as governance, enterprise risk management and strategic oversight. In other words, it is just as important. Sadly, many companies fail to give it the attention it requires. A PricewaterhouseCoopers (PwC) survey, found nearly one-half of the more than 1,000 directors gauged reported dissatisfaction with their companies’ succession plans. Imagine what that number would be if they took into account the compliance aspect of succession planning. Some of the questions you might consider are the following. How did you fully operationalize compliance into the business unit that you managed? What controls did you put in place? And then what did you do when you found out about it?
Every time I perform a risk assessment and speak to the company’s HR lead, they immediately understand the role than can play in moving forward a company’s compliance program. Even if the HR role is limited in the hiring process, they can ask potential candidates their views to determine underlying business ethics. HR can also begin the compliance inculcation process, even pre-hiring, by talking about the company’s values in the interview process. This sets an expectation that can be built upon if a candidate is selected and in every HR touch point going forward, including looking at employees in the succession planning process.
Three key takeaways:
- Succession planning is just as important as governance, enterprise risk and strategic oversight.
- Do not begin your succession planning when a senior manager announces their retirement.
- You are always being evaluated (or you should be).
For more information, check out The Compliance Handbook, 4th edition here.
Welcome to 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 with the people and organizations that make this the most unique areas of Texas. Join Tom as he explores the people, places and their activities of the Texas Hill Country.
It’s no secret that Texas farmers and ranchers are facing a variety of challenges. But thanks to the progress made during the 89th Texas Legislature, some of these issues are being addressed. In this episode of the podcast, Tom Fox speaks with Carter Keating, the founder and executive director of Texas Agriculture Connection, a nonprofit advocacy organization, about the progress made during the recent legislative session.
Keating explains how House Bill 1750 and House Bill 23 Eight strengthened the existing right to Farm statute, and how House Bill Nine used fiscal policy to access federal resources for Texas to develop and operate broadband infrastructure. Additionally, he talks about the New Water Supply for Texas Fund, which was established to finance water supply projects and develop 7-million-acre feet of new water supplies over the next ten years. He also discusses the Texas Water Fund, which provides funding for repair and replacement of water infrastructure, awareness programs, and rural political subdivisions.
Keating also explains the importance of broadband access. He points out that 7 million Texans across 3 million households lack quality, high speed broadband Internet access, which can have a negative impact on education access, health care outcomes, and businesses’ ability to compete. House Bill Nine made use of some very smart fiscal policy to put up matching funds to get access to federal resources for Texas to develop and operate broadband infrastructure.
The organization also worked on House Bill 2851, which would increase the maximum size of a grant under the Young Farmer Grant Program from twenty thousand dollars to thirty-five thousand dollars. House Bill One, the general appropriations bill, appropriated $500,000 to the Young Farmer Grant Program over the next two years.
Keating also talks about his plans to travel across the state to solicit the opinions of farmers and ranchers and other agricultural producers. He explains that the issues for farmers are fairly consistent across the state, with water, broadband, and infrastructure being important issues that span across the state of Texas.
In addition to the legislative progress made, there are 14 proposed constitutional amendments on the ballot in November. Texas Agriculture Connection and TAC are in support of voting yes on three proposed constitutional amendments: HJR 126, HJR 125, and SJR 75.
Finally, Keating discusses the 18-month period between the end of one regular session and the start of the next regular session. He explains that Texas Agriculture Connection and other organizations will be focusing on hearing from farmers and ranchers about their issues over the next 18 months.
This episode provides an insightful look into the progress made in the Texas Legislature and the issues that are important to Texas farmers and ranchers. It’s clear that the right to farm, broadband infrastructure, water infrastructure, and young farmer funding and support are all important issues for Texas farmers and ranchers. With the progress made during the 89th Texas Legislature and the upcoming constitutional amendments, Texas farmers and ranchers can look forward to a brighter future.
Key Highlights
· Assessment of Agricultural initiatives in the 88th Legislature
· Right to Farm
· Water Infrastructure
· Broadband Infrastructure
· Constitutional amendments
Resources
Carter Keating on LinkedIn
Tom Fox
How do small towns and rural counties invest in their future? Tom Fox and Andrew Gay explore this topic in their new podcast series Investing in the Future – Developing Leadership in Kerr County. Leadership Kerr County is the premier leadership program in the Hill Country which enables men and women to learn more about the issues and topics that face Kerrville, Kerr County, and the Hill Country daily; everything from education and social services to economic development and health care. Kerr County has made the decision to invest in its citizens to create future leaders and lay a foundation for their future involvement in the leadership of Kerrville and Kerr County. This podcast is produced and hosted by the Texas Hill Country Podcast Network.
Megan Folkerts is an exemplary example of what can be achieved when you have a passion for leadership and community development. As the senior management analyst for the city of Kerrville and downtown liaison for Main Street, she was accepted into the Leadership Kerr County program this year and has been networking with like-minded individuals and exploring the different standard pillars of the community.
Megan heard about Leadership Kerr County a couple of years ago and was encouraged to apply. She was accepted into the program on the first application and has since been networking with other people who have like-minded interests in leadership and developing themselves. She has explored different facilities and learned about the different standard pillars of the community such as healthcare and nonprofit. She also experienced a poverty simulator to understand the struggles people face day to day. After going through the poverty simulator, she realized how privileged one is.
Megan Folkerts is an inspirational example of what can be achieved when you have a passion for leadership and community development. She grew up in Buda, between San Marcus and Austin, and got her bachelor’s in business from Tarleton and Stephenville. She got her master’s from Tarleton while working for the city of Bastrop. She applied for the Leadership Kerr County program after being encouraged by Drew Paxton. She has since been networking with other people who have like-minded interests in leadership and developing themselves.
Resources
Andrew Gay on LinkedIn
Tom Fox on LinkedIn
The award-winning, 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 explore a subject more. Looking for some hard-hitting insights on sanctions compliance? Look no further than Compliance into the Weeds! In this episode, Tom and Matt consider the recent SEC and CFTC enforcement actions around messaging app non-compliance.
Join Tom and Matt as they take a deep dive into the enforcement actions and then consider how such claims would impact non-regulated industries. Regulated industries, particularly broker-dealer firms like Wells Fargo and Morgan Stanley, are facing enforcement actions and hefty fines for their employees’ use of messaging apps like WhatsApp and Snapchat that allow record preservation to be disabled. The involvement of senior managers in these misconducts has prompted the SEC to require an independent compliance consultant in settlements.
The conversation between Tom and Matt emphasizes the importance of messaging policies and procedures in regulated industries and the need for stricter compliance measures. They also discuss the complexities and potential consequences of record-keeping obligations and the regulatory concerns over the use of messaging apps. The conversation briefly touches on the future of AI chatbots in customer service, with differing perspectives on their ethical implications. Overall, the conversation highlights the significance of messaging policies, enforcement, and compliance in regulated industries.
Key Highlights
· Enforcement Actions Against Regulated Industries
· Enforcement actions and messaging policies
· Record-keeping obligations for broker dealers and other industries
· Regulatory concerns over the use of messaging apps
· Internal Controls and non-regulated industries
Resources
Matt
Blog Post in Radical Compliance
No Smoke and No Fire: The Rise of Internal Controls Absent Anti-Bribery Violations in FCPA Enforcement by Karen Woody in Cardoza Law Review
Tom
The Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) have repeatedly emphasized the importance of aligning compensation plans with compliance goals. According to Tom Fox, aligning the compensation plan of salespeople can have a greater impact on compliance revenue than other forms of communication. By incentivizing ethical behavior, companies can reinforce the message of compliance and create a culture that prioritizes adherence to regulations.
To maximize the impact of compensation structures, immediate implementation is crucial. Waiting too long can dilute the message and hinder the desired behavioral changes. Employees should clearly see the connection between their actions and the incentives they receive. This immediate feedback loop motivates them to align their behavior with the goals of the compliance program.
While transparency is important in the incentive system, it should not solely be a democratic process where salespeople design the program around their own needs. However, involving employees in the process can help them appreciate changes that may not be favorable to their individual situations. Transparency fosters a sense of trust and accountability, leading to better acceptance and adherence to the compensation structure.
Compensation can be a powerful motivator for salespeople to act in ways that support the company’s evolving business model and strategy. By integrating compliance incentives into the compensation program, companies can make compliance an integral part of their organizational values. This not only drives compliant behavior but also ensures that employees understand and support the company’s overall strategy.
If your company has not yet integrated compliance incentives, it’s time to catch up. The DOJ and SEC recognized the importance of compliance incentives over 15 years ago, so companies without them are lagging behind. A practical way to start is by allocating a percentage of the discretionary bonus program to compliance. Even a small percentage can demonstrate the company’s commitment to ethical conduct and encourage employees to prioritize compliance.
Compliance incentives play a crucial role in shaping the behavior and mindset of employees within an organization. While disciplinary actions are essential, incentives provide a positive reinforcement mechanism that encourages individuals to embrace compliance as an integral part of their work. Tom Fox emphasizes that compliance incentives need not be elaborate or groundbreaking; what matters most is their consistent implementation.
There are six core principles that form the foundation of successful compliance incentives.
- Consistency is Key. Compliance incentives must be consistently applied throughout the organization. By doing so, companies can create a sense of fairness and predictability, reinforcing the message that compliance is non-negotiable.
- Supporting Systems. To ensure compliance incentives are followed, it is crucial to have supporting systems in place. These systems can include regular training, clear guidelines, and robust reporting mechanisms, enabling employees to understand and adhere to compliance standards.
- Transparency. Making compliance incentives transparent within the organization is essential. By showcasing the recognition and rewards associated with compliance, companies can inspire others to embrace ethical behavior and create a positive ripple effect.
- Overcoming Competing Goals. If safety is No.1 within an organization, doing business ethically and in compliance should be goal 1A. But often challenges can arise when competing goals, such as financial pressures, overshadow compliance incentives. To counterbalance this, a strong counterweight is necessary to ensure that compliance remains a priority, even during financial downturns.
- Rewarding Performance. Compliance incentives can be used to hold leaders accountable for their performance, aligning their goals with the company’s compliance objectives. This approach ensures that compliance is not sacrificed for short-term financial gains.
- Non-Linear Alignment. Compliance incentives should align work in an oblique, non-linear way, allowing employees to choose their own pathways while still adhering to compliance standards. This flexibility empowers individuals to contribute to compliance efforts in a manner that suits their strengths and preferences.
All of these guidelines mean that you must align compliance as an integral part of your company’s DNA. Regularly communicate the importance of compliance and the benefits it brings to the organization and its stakeholders. It is critical to implement compliance incentives at all levels of the company. Division or business unit heads can define pro-social goals and establish supporting structures and systems. Even lower-level employees should have their own version of the compliance incentive process.
There must be tangible incentives offered to employees; both financial and hierarchical, to those who consistently demonstrate ethical behavior and compliance within your Code of Conduct and relevant laws. These rewards can range from cash awards to certificates, plaques, or even coffee mugs and t-shirts. Obviously Document Document Document is critical. Just as all other parts of your compliance program are documents, so should your incentive program.
Document compliance actions to demonstrate to regulators, if necessary, that your organization takes compliance seriously. This documentation showcases your commitment to ethical business practices and provides evidence of your compliance efforts. There must be support systems in place to reinforce the message of compliance, even during challenging times.
Creating a culture of compliance requires a multifaceted approach, and compliance incentives play a vital role in driving ethical behavior within organizations. By consistently implementing these incentives, aligning employees around compliance goals, and leveraging tangible rewards, companies can foster a sustainable culture of compliance. Remember, compliance is not just a checkbox; it’s an integral part of your organization’s success.
Incorporating compensation systems into compliance programs is a vital step towards building a culture of compliance within organizations. By aligning salespeople’s compensation plans with compliance goals, implementing immediate and transparent structures, and involving HR in the process, companies can reinforce ethical behavior, promote compliance, and drive the success of their compliance programs. Remember, simplicity, alignment with company values, and immediate impact on behavior are key factors to consider when designing your compensation structure. Finally always remember to prioritize compliance and create a workplace culture that values integrity and ethics.