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Daily Compliance News

Daily Compliance News: December 5, 2024 – The CTA Enjoined Edition

Welcome to the Daily Compliance News. Each day, Tom Fox, the Voice of Compliance, brings 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.

For more information on the Ethico Toolkit for Middle Managers, available at no charge, click here.

Check out the entire 3-book series, The Compliance Kids, on Amazon.com.

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Blog

Reimagining Compliance as a Product

In the modern corporate environment, compliance must transcend its traditional role as a set of rules and regulations. Instead, it should be reimagined as a product—something employees actively choose to engage with daily. Inspired by product design principles, this approach positions compliance as a value-driven offering that meets employee needs while supporting organizational integrity.

In an HBR article entitled Reimaging Work as a Product, authors Eric Anicich and Dart Lindsley ask if there is a better way to approach the employee experience. The authors challenge traditional paradigms by proposing that work be viewed as a product employers offer employees. They advocate that reimagining work as a product addresses the disengagement and dissatisfaction rampant in the workforce and aligns employees’ needs with organizational goals. I have adapted their piece for a compliance audience.

This concept is about something other than making compliance easier. Instead, it is about making it indispensable and aligned with employee motivations. By redesigning compliance as a product employees “purchase” with their engagement, compliance professionals can enhance participation, foster a culture of ethics, and drive long-term success.

It all begins with why compliance must be seen as a product to be delivered inside an organization. Compliance often needs help to capture employee attention. Mandated training modules and periodic policy updates can feel disconnected from day-to-day work. Employees may view compliance as a checkbox task rather than a meaningful element of their roles. Yet, disengaged employees pose significant risks, from regulatory violations to ethical breaches.

Reimagining compliance as a product addresses these challenges. Like any successful product, compliance should do such things as (1) solve employee pain points, (2) offer clear and personalized value, and (3) foster ongoing loyalty and engagement. How can compliance move to this approach or at least be seen?

The Product Design Approach to Compliance

  • Understanding Why Employees “Hire” Compliance.

Drawing on Clayton Christensen’s Jobs to be Done theory, employees engage with compliance to fulfill specific personal, professional, or organizational needs. Some examples of compliance jobs are reducing risk for a corporation and its employees, as everyone wants protection from liability or disciplinary action. Compliance enables growth and profitability, as more effective compliance = more efficient business process = greater profitability. Finally, compliance aligns with the values of almost all employees, as they want a workplace that mirrors their ethics.

This approach has another benefit for the compliance function. It requires an assessment of your organization from a cultural perspective. In the 2024 ECCP, the DOJ made clear that companies must use data to help manage their corporate culture. The information gleaned will also help the corporate compliance professional understand what the employees want and need from a compliance solution. You can use these insights to craft messaging that positions compliance as a solution to their unique challenges.

  • Segmenting Compliance Customers

Not all employees interact with compliance in the same way. Tailoring the compliance product to different groups ensures it resonates broadly. Just as the DOJ mandates tailored training and communications, you can tailor the delivery of compliance solutions for your employees. This can include using the Customer Segments in your organization, such as new employees, who will need a greater foundational understanding of policies and reporting channels. For managers, it could require advanced training on fostering ethical cultures, monitoring compliance, and learning how to the first intake in a speak-up culture. Finally, there will be employees in your organization who, because of their specialized roles, will require targeted knowledge, such as export controls for logistics teams or anti-bribery rules for sales.

The compliance professional can work to create tiered compliance offerings. For instance, beginner courses for new hires, role-specific modules for specialists, and leadership workshops for managers. This is also true for the targeted communications you use on a more regular basis for employees. For instance, more communications on facility payments could be a useful service for employees who travel internationally.

  • Balancing Employee Needs with Compliance Requirements

While compliance professionals must meet regulatory demands, they can still design programs that respect employee time and preferences. There are some easy ways for a compliance professional to not only think about this step but also act on it. You can consider the modular design of your compliance training by breaking it into smaller, digestible segments that employees can complete at their convenience. Interaction can also drive engagement, so consider using interactive formats such as gamification, simulations, or role-playing to make compliance training engaging and memorable.

Your first step should be to use analytics to identify bottlenecks in compliance processes. If employees find certain tasks burdensome, redesign them with user-friendly tools or workflows. From there, take the information and craft a solution that meets the users’ needs, not just those from the compliance department. As Carsten Tams continually reminds us, it’s all about the UX.

Measuring the “Success” of Compliance as a Product

Successful products are evaluated by customer satisfaction and retention. Similarly, compliance success should be measured by how effectively it engages employees and fosters a culture of ethics. As Megan Daugherty also reminds us, it is about the numbers. So, what are your metrics for compliance engagement? What are your adoption rates? How many employees complete optional compliance training or use reporting tools? Equally important are your retention rates. You must determine if your company’s employees consistently follow compliance protocols. Finally, go outside the box with something like the Net Promoter Score (NPS), which helps you determine how likely employees are to recommend their company’s compliance program to peers.

There are multiple tools you can use for feedback. You can use a Pulse Survey, which gauges employee perceptions of compliance processes. You can use Focus Groups to explore pain points and opportunities for improvement in depth. You can use behavioral data garnered through monitoring adherence to compliance requirements through key performance indicators (KPIs). Finally, tools such as the Culture Audit can provide both a benchmark and framework to help compliance professionals understand the state of their culture and how to assess and improve it.

Addressing Challenges in Compliance Product Design

There will be challenges in taking this approach. Some key (and early) challenges will include overcoming resistance, particularly from employees who view compliance simply as an obligatory burden. Yet framing compliance as a resource, not a restriction, highlights how it protects employees, supports their career goals, and aligns with organizational values. Another employee concern could be balancing personalization with fairness, as some employees might view personalized compliance experiences as creating perceptions of favoritism. The solution should be to set clear criteria for personalization, such as role-specific training requirements, and communicate them transparently to avoid misunderstandings.

Finally, the biggest challenge will be to change the Tone at the Top by shifting your senior leadership’s mindsets. Typically, senior management prioritizes short-term goals over longer-term compliance initiatives. Here, you can quantify the value of compliance. For example, demonstrate how ethical lapses affect revenue, reputation, and employee retention to gain leadership buy-in.

Practical Steps for Redesigning Compliance as a Product

You should begin mapping the compliance journey by identifying key touchpoints, such as onboarding, annual training, and reporting. From there, look for pain points where employees disengage and redesign those interactions. Feedback loops can be useful to share survey results with employees to show that their input shapes compliance initiatives. Compliance Champions can work to empower managers and ethical leaders to advocate for compliance within their teams. Always remember to celebrate employees who model ethical behavior as brand ambassadors for compliance. Finally, in 2024, leverage technology by implementing AI-driven dashboards to monitor real-time compliance risks and engagement. Another key tool is chatbots, which provide instant answers to employee compliance queries.

Building a Compliance Product Employees Choose Daily

Reimagining compliance as a product transforms it from a mandate into a partnership. Compliance can become a trusted ally in the workplace by delivering value, fostering engagement, and respecting employee needs. This approach not only enhances compliance outcomes but also strengthens the ethical fabric of the organization. So, as Carsten Tams says, It’s all about the UX: are you treating compliance as a product employees want to engage with? The time has come to innovate compliance for the modern workplace, making it a cornerstone of trust, integrity, and success. Work to build a compliance program employees want to subscribe to every day.

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Compliance Tip of the Day

Compliance Tip of the Day – Board Compliance Committee

Welcome to “Compliance Tip of the Day,” the podcast where we bring you daily insights and practical advice on navigating the ever-evolving landscape of compliance and regulatory requirements. Whether you’re a seasoned compliance professional or just starting your journey, we aim to provide bite-sized, actionable tips to help you stay on top of your compliance game. Join us as we explore the latest industry trends, share best practices, and demystify complex compliance issues to keep your organization on the right side of the law. Tune in daily for your dose of compliance wisdom, and let’s make compliance a little less daunting, one tip at a time.

Every corporate Board of Directors should have a Compliance Committee.

For more information on the Ethico Toolkit for Middle Managers, available at no charge, click here.

Check out the full 3-book series, The Compliance Kids, on Amazon.com.

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Compliance Into the Weeds

Compliance into the Weeds: DOGE and Compliance

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 fully. Are you looking for some hard-hitting insights on compliance? Look no further than Compliance into the Weeds! In this episode, Tom Fox and Matt Kelly dive into the Trump Administration’s DOGE initiatives and what it might mean for compliance.

Tom and Matt discuss the implications of Elon Musk and Vivek Ramaswamy’s Department of Government Efficiency Committee (DOGE), which aims to downsize the federal government drastically. They explore the potential consequences of cutting half of all regulations and federal employees, particularly on compliance officers and corporate risk management. The conversation highlights how the reduction or abolition of federal regulations would affect various sectors, including the military, social security, and essential services, and delves into the challenges this proposal poses for compliance programs within businesses. They also consider possible outcomes such as increased state-level regulations, civil litigation, and the chaos and uncertainty that might follow. Finally, they discuss how companies should prepare for an inconsistent and unpredictable regulatory environment under a Trump administration.

Key highlights:

  • DOGE and Government Restructuring
  • Implications for Compliance Officers
  • Challenges of Cutting Regulations and Staff
  • Potential Consequences of Reduced Regulations and Non-Enforcement
  • Compliance Embedded in Business Practices
  • State-Level Regulation and Emerging Risks

Resources:

Matt in Radical Compliance

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Great Women in Compliance

Great Women in Compliance – Neta Meidav on Bridging the Trust Gap

In this week’s episode, Hemma visits Neta Meidav to discuss bridging the trust gap with innovative technology and the power of women entrepreneurs in the ethics and compliance space. Neta is a visionary entrepreneur and CEO co-founder of Vault Platform, an impact-driven company disrupting outdated workplace misconduct reporting and resolution models.

Highlights include: 

  • Bridging the trust gap by focusing on the employee experience
  • Building impact and values into the DNA of a product
  • How to proactively prevent and detect misconduct using AI and disruptive technologies
  • The role of women founders and entrepreneurs in ethics and compliance
  • The release of #ethicschat by Vault – revolutionizing compliance knowledge management 

Biography:

Neta is the Founder and CEO of Vault Platform. She founded Vault to modernize ethics and compliance and create more equitable, safe, and ethical workplaces worldwide. Neta was recently named one of Inc. Magazine’s Female Founders 200.

Before founding Vault, Neta worked for over a decade in the UK Government as a climate change negotiator and participated in the Paris Climate Agreement. Alongside leading Vault, Neta is on a mission to promote female founders in tech and spends time coaching and helping her fellow female founders who are earlier on their journey.

Resources:

www.vaultplatform.com

Press Release on the launch of #ethicschat by Vault 

Thanks to our sponsor, Corporate Compliance Insights, and the wonderful #GWIC community.  You can join the Great Women in Compliance community on LinkedIn here.

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Blog

Rethinking the Employee Experience from the Compliance Perspective

In today’s competitive labor market, retaining top talent is more than just a human resources challenge but a compliance priority. This is one insight from the Harvard Business Review article, What Companies Get Wrong About the Employee Experience. In this piece, the authors outline actionable lessons and steps that compliance professionals can integrate to enhance ethical culture, reduce turnover risks, and strengthen compliance outcomes. Here’s how reimagining the employee experience aligns with robust compliance strategies.

The Intersection of Employee Experience and Compliance

The article emphasizes that many organizations must offer gratifying work experiences, leading to attrition and disengagement. For compliance professionals, these failures are alarming. Disengaged employees are less likely to follow compliance protocols, report concerns, or participate in ethical initiatives. High turnover amplifies this risk by disrupting organizational knowledge and weakening cultural consistency.

Every compliance professional understands that a well-designed employee experience fosters trust, transparency, and ethical alignment, all of which are critical for a strong compliance program. The Department of Justice (DOJ) also recognizes this. In the Monaco Memo, the DOJ pointed to corporate culture as a key indicator of an effective, operationalized compliance regime. In the 2024 Evaluation of Corporate Compliance Programs (ECCP), the DOJ further clarified its expectations in this area of compliance.

The Push and Pull of Employee Retention

While it should be discussed more, every corporate compliance function should thoroughly consider this issue of employee retention. The 2024 reiterated the DOJ position that the compliance function is the keeper of both Institutional Fairness and Institutional Justice and from these precepts, it is a clear entry point into compliance. The article identifies two forces driving employee departures and retention.

  • Push Factors are negative experiences, such as lack of trust, feeling undervalued, or toxic management. Push Factors can lead to ethical breaches, as disengaged employees may cut corners or fail to report misconduct.
  • Pull Factors. These provide employees with opportunities for alignment, flexibility, and personal growth. Pull Factors emphasize the need for a compliance-driven culture that aligns personal values with organizational integrity.

For the compliance professional, you must mitigate push factors by fostering a supportive, ethical environment and amplify pull factors by offering meaningful growth opportunities tied to compliance goals. It all starts with a true culture of speaking up and listening up. If employees feel they can safely speak up with no fear of retaliation and that their concerns will be heard, it can lead to more employee opportunities.

Proactive Compliance Strategies for Employee Engagement

What are some additional strategies for employee engagement? The authors recommend three transformative approaches to improve employee experiences, which also strengthen compliance initiatives:

  • Interview Employees Early and Often

Waiting until an exit interview is a missed opportunity. You should interview employees throughout the employment life cycle, from employment interviews and onboarding through the entire employment life. Compliance leaders should adopt proactive listening to understand and address employee concerns about ethical culture and workplace practices. Middle managers should be trained on not only how to accept information through a Speak Up culture but, equally importantly, how to Listen Up.

Another strategy could be to conduct regular “ethical climate surveys” to gauge employee sentiment about compliance. One example is the Culture AuditÔ developed by Sam Silverstein and his Accountability Institute. Whatever tool you might utilize, you should use the insights you obtain to refine training programs and policy enforcement.

  • Develop “Shadow” Job Descriptions

Traditional job descriptions often overlook the ethical dimensions of roles. I mentioned above how compliance can work to improve employee engagement as early as the interview process. You can also work to create “shadow” descriptions that highlight compliance responsibilities, ensuring employees understand the ethical expectations tied to their positions. The compliance function can collaborate with HR to embed compliance duties, such as reporting obligations and ethical decision-making, into all job descriptions. You can begin communicating these expectations during the hiring process, then the onboarding process and regular evaluations.

  • Collaborate with HR to Align Roles with Progress

Flexibility in role design helps employees see a clear path for ethical growth within the organization, reducing the risk of disengagement. The DOJ has made both financial and non-financial incentives an essential part of every compliance program. This means compliance should partner with HR to create rotational programs that expose employees to compliance-related functions. The clear message at your organization should be that there are ethical leadership opportunities in your company that operate as a pathway to career advancement.

Leveraging Technology to Enhance Compliance and Employee Experience

While most compliance professionals only think about data, advanced analytics, and AI-driven tools in the context of transaction analysis, these tools are transforming how organizations approach employee engagement. For compliance teams, these technologies offer dual benefits. You can use real-time monitoring to track compliance, training participation, and ethical climate indicators. Moreover, analytics, such as sentiment analysis, identify areas of concern or disengagement that may correlate with compliance risks. You should deploy data analytics and AI-based or enhanced tools that flag anomalies in training completion rates or whistleblower program usage, enabling timely interventions.

 Building an Ethical Culture Employees Rehire Daily

The bottom line is that you are asking employees to choose to do business ethically and in compliance. Your ultimate goal is to create a workplace where employees actively select daily. Your organization is where compliance is a shared value rather than a mandate. Achieving this requires multiple and continuous steps. One is continuous dialogue to keep communication channels open to reinforce ethical values. When information shows anomalies forming or detected, you should create a targeted action plan to act on feedback to demonstrate commitment to improvement swiftly. Finally, data, key performance indicators, and other transparent metrics should be used to share progress on employee experience and compliance outcomes.

The Compliance-Employee Experience Connection

The employee experience is not just a human resources initiative but a cornerstone of effective compliance. Compliance professionals can build a resilient, ethical workplace by addressing the factors that drive employee satisfaction and retention. This isn’t just about preventing turnover; it is about creating a culture of trust and integrity that empowers employees to champion compliance. By integrating these principles into your compliance strategy, you retain top talent and fortify the ethical foundation that supports sustainable success.

Call to Action

How is your compliance program enhancing the employee experience? It is time to reimagine the intersection of ethics, culture, and engagement to create lasting value for your organization.

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Compliance Tip of the Day

Compliance Tip of the Day – Boards and Operationalizing Compliance

Welcome to “Compliance Tip of the Day,” the podcast where we bring you daily insights and practical advice on navigating the ever-evolving landscape of compliance and regulatory requirements. Whether you’re a seasoned compliance professional or just starting your journey, we aim to provide bite-sized, actionable tips to help you stay on top of your compliance game. Join us as we explore the latest industry trends, share best practices, and demystify complex compliance issues to keep your organization on the right side of the law. Tune in daily for your dose of compliance wisdom, and let’s make compliance a little less daunting, one tip at a time.

Your Board must work to operationalize compliance at all levels of your organization entirely.

For more information on the Ethico Toolkit for Middle Managers, available at no charge, click here.

Check out the full 3-book series, The Compliance Kids, on Amazon.com.

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Innovation in Compliance

Innovation in Compliance – Navigating Compliance and Innovation with Colin Darke

Innovation comes in many forms, and compliance professionals need to be ready for it and embrace it. Join Tom Fox, the Voice of Compliance, as he visits with top innovative minds, thinkers, and creators in the award-winning Innovation in Compliance podcast. In this episode, host Tom Fox visits with Colin Darke, an attorney and compliance professional with a diverse career spanning over twenty years.

Colin shares his journey from banking and finance law to in-house compliance roles, eventually co-founding CompliSun, an AI-enhanced compliance management system. Colin discusses his experience handling regulatory challenges, building compliance programs from scratch, and innovating within fintech. He also delves into his book ‘Unleashing Innovation: Compliance Strategies for FinTech Disruptors,’ which offers practical guidance for compliance professionals. Additionally, Colin explores his dual passion for art, explaining how being an artist has contributed to his mental well-being and professional success. Listeners will gain valuable insights into integrating AI in compliance, effective training techniques, and the importance of creating a strong compliance narrative for regulators.

Key highlights:

  • Colin Darke’s Professional Journey
  • Authorship and Book Insights
  • CompliSun: AI-Enhanced Compliance
  • Regulated vs. Non-Regulated Industries
  • AI Revolution in Compliance
  • Art and Compliance: A Unique Intersection

Resources:

Colin Darke on LinkedIn

CompliSun

Unleashing Innovation-Compliance Strategies for Fintech Disruptors

Tom Fox

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Compliance Tip of the Day

Compliance Tip of the Day – Compliance Obligation for Boards

Welcome to “Compliance Tip of the Day,” the podcast where we bring you daily insights and practical advice on navigating the ever-evolving landscape of compliance and regulatory requirements. Whether you’re a seasoned compliance professional or just starting your journey, we aim to provide bite-sized, actionable tips to help you stay on top of your compliance game. Join us as we explore the latest industry trends, share best practices, and demystify complex compliance issues to keep your organization on the right side of the law. Tune in daily for your dose of compliance wisdom, and let’s make compliance a little less daunting, one tip at a time.

Today, we begin considering Board obligations around compliance.

For more information on the Ethico Toolkit for Middle Managers, available at no charge, click here.

Check out the full 3-book series, The Compliance Kids, on Amazon.com.

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Blog

The Role of Compliance in Employee Retention

The fight to attract and retain top talent has long been a concern for corporate leaders, but the stakes are even higher for compliance professionals. The insights from the Harvard Business Review (HBR) article Why Employees Quit the authors offer actionable lessons that compliance professionals can integrate into their strategic efforts. Let’s explore how fostering a meaningful employee experience can mitigate compliance risks and strengthen organizational integrity.

The Compliance Costs of Employee Attrition

Employee turnover is more than a budgetary concern; it is also a compliance risk. When experienced employees leave, they take with them institutional knowledge, including an understanding of the organization’s policies, culture, and compliance framework. The cost of replacing employees ranges from 6 to 9 months of their salary—and for executive roles, it can double their annual pay. More insidiously, high attrition rates may signal deeper issues, such as cultural dysfunction or ethical lapses, which could attract regulatory scrutiny.

For the compliance professional, employee retention is not simply about the cost of replacement and retraining but about sustaining a culture of ethics and compliance. Addressing the root causes of turnover is an investment in long-term corporate resilience.

Understanding Employee Quests for Progress

The authors identify four primary motivations driving employees to switch jobs:

  1. Getting Out- escaping from toxic environments or dead-end roles.
  2. Regaining Control- seeking autonomy and work-life balance.
  3. Regaining Alignment – a desire for respect and utilization of skills.
  4. Taking the Next Step- pursuing growth opportunities.

Each of these quests resonates with compliance principles. For example, consistent policy enforcement may frustrate employees seeking alignment, while those striving for growth may feel supported by a lack of training or mentorship.

Compliance Takeaway: A compliance program should ensure adherence to laws and regulations and foster an environment where employees feel valued and empowered.

Proactive Measures: Compliance as a Partner in Employee Retention

The authors recommend three strategies for aligning employee experiences with organizational goals. Here’s how compliance can lead the charge:

  • Interview Employees Early and Often

Exit interviews should be conducted more often, but they should be too late. Instead, compliance professionals can implement regular “pulse checks” to assess the ethical climate and identify areas where employees feel unsupported. Consider aligning these efforts with the DOJ’s emphasis on continuous monitoring in compliance programs. As a practical step, include ethical climate questions in employee surveys and encourage anonymous reporting to surface hidden concerns.

  • Develop Shadow Job Descriptions

Official job descriptions often need to capture the dynamic realities of roles, leading to mismatched expectations. Compliance can play a pivotal role in ensuring these descriptions reflect the ethical responsibilities associated with the job. Your corporate compliance function should work closely with HR to include clear expectations for ethical behavior, reporting obligations, and compliance training in every role.

  • Collaborate with HR to Align Roles with Employee Progress

Flexible role design can create opportunities for employees to grow while adhering to compliance standards. This approach satisfies employees’ quests for progress and reduces the likelihood of ethical lapses driven by disengagement or frustration. This ties directly into what the DOJ wants to see around non-financial incentives for employees doing business ethically and in compliance. The 2024 ECCP speaks directly to this issue, and once again, compliance should partner with HR to design roles that balance individual aspirations with organizational needs, ensuring compliance remains a core element and fully incentivizes employees in and around compliance.

The Compliance Implications of “Pushes” and “Pulls”

The authors identify joint “push” factors, such as lack of trust, poor management, and generally poor culture, as well as “pull” factors, including alignment with values, flexibility, and a more positive corporate culture in job switches. Push Factors include a lack of trust in leadership, which often correlates with higher compliance risks. Employees disengaged from management will typically disengage from compliance initiatives. Conversely, Pull Factors enhance values-driven employees. Such employees are more likely to thrive in organizations that prioritize ethical behavior. Compliance professionals should pay close attention to these dynamics in their organizations. Moreover, for corporate compliance professionals, as the holders of Institutional Justice and Institutional Fairness in an organization, addressing push factors and amplifying pull factors can help create a culture where compliance is not merely a requirement but a shared value.

Technology’s Role in Enhancing the Employee Experience

Advanced compliance monitoring tools like AI-driven analytics can support compliance objectives and employee retention efforts. These tools can provide real-time insights into employee sentiment, flagging potential compliance risks while highlighting areas for improvement in the employee experience. Compliance professionals can utilize analytics to monitor ethical climate indicators, including response rates to compliance training and engagement in whistleblower programs.

Building a Workplace Employees Want to “Rehire” Every Day

Compliance professionals have a critical role in shaping an ethical, engaging workplace. By embedding employee-focused strategies into compliance initiatives, organizations can reduce turnover, strengthen their ethical culture, and build a more resilient compliance program.

The employee experience is no longer a “soft” issue; it is now imperative for compliance. By proactively addressing why employees leave, compliance leaders can ensure their organizations retain talent and integrity. For the CCO, you should ask: Are you engaging your employees in ways that align with compliance priorities? If not, it’s time to reimagine compliance as a partner in the employee experience. This intersection of compliance and employee experience is an opportunity to drive meaningful change. Compliance professionals need to seize it and move your entire culture forward.