Tag: compliance

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31 Days to More Effective Compliance Programs

One Month to A More Effective Compliance Program Through Innovation: Day 14 – Creating an Inventory of Metrics

The 2023 ECCP not only continued to emphasize the importance of monitoring and testing the effectiveness of a compliance program, but it spoke more about a Chief Compliance Officer (CCO) and compliance function utilizing data to engage in continuous monitoring and continuous improvement. For some time, the DOJ has stressed the importance of leveraging data to have objective evidence around whether or not a compliance program is working effectively. Yet, as many CCOs are legally trained, they are still determining what specific areas to consider in establishing quantifiable metrics to monitor for effectiveness.

A methodical review of the 2023 ECCP to identify the different areas where a company could establish and quantify metrics to assess effectiveness is the place to start. Many companies have what Edwards called “metrics on the basics” and noted they “have in place processes whereby their employees review the Code of Conduct and confirm they comply with it either when they first onboard with the company and then periodically on an annual basis, companies are doing just fine at reporting.” But it is now the barest minimum of what compliance professionals must do. For instance, they could consider Quote To Cash (QTC) lifecycles or Procure To Pay (P2P). The key starts with a documented process that can be audited and built from there.


Three key takeaways:

  1. Create an inventory of compliance metrics.
  2. Create your metrics based on the 2023 ECCP.
  3. Use these metrics for continuous monitoring and improvement.

For more information, check out The Compliance Handbook, 4th edition, here.

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31 Days to More Effective Compliance Programs

One Month to a More Effective Compliance Program Through Innovation: Day 13 – Consistency as a Compliance Best Practice

The 2023 ECCP emphasized the need for the corporate compliance function to ensure consistency and fairness in monitoring investigations and the resulting discipline. One of the ways the 2020 Update emphasized this was through tracking the investigations and the discipline that may come out of any investigation. Companies’ challenges are that facts and circumstances are always different in every investigation. This makes it sometimes difficult, but if companies treat employees of one country differently in terms of discipline, it does create potential gaps in a compliance program. This can give certain countries a feeling that they can do what they want without the risk of punishment from corporate headquarters. This is why the DOJ re-emphasized monitoring the investigations and ensuring consistent application of discipline as a critical factor in providing an effective compliance program.

The FCPA Resource Guide, 2nd edition, added a new hallmark to the previously titled 10 Hallmarks of an Effective Compliance Program (now it is simply the Hallmarks). The Hallmark added was one that has been around for some time: Root Cause Analysis (RCA). It is familiar because it was subtly considered in the original FCPA Resource Guide and explicitly discussed since at least the original formulation of the Evaluation of Corporate Compliance Programs in February 2017.

The focus on consistency is insightful and instructive as a key element of a best practices compliance program. Consistency forms the basis of both institutional justice and institutional fairness. That, in turn, facilitates a speak-up culture, which is the role of the compliance department to foster.

Three key takeaways:

  1. Consistency is a key part of any compliance program.
  2. Consistency forms the basis of both institutional justice and institutional fairness.
  3. Consistency facilitates a speak-up culture.

For more information, check out The Compliance Handbook, 4th edition, here.

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Data Driven Compliance

Data Driven Compliance: The Transformative Potential of AI in Compliance Investigations

Are you struggling to keep up with the ever-changing compliance programs in your business? Look no further than the award-winning Data Driven Compliance podcast, hosted by Tom Fox. This podcast features an in-depth conversation about the uses of data and data analytics in compliance programs. Data Driven Compliance is back with another exciting episode. Today, Tom takes a solo turn to consider using AI to facilitate compliance investigations.

The advent of artificial intelligence (AI) is revolutionizing the landscape of legal and compliance investigations, enhancing substantiation rates, expediting case closure times, and preserving crucial evidence. Tom Fox, a seasoned expert in the field, firmly believes in the transformative potential of AI in this domain. He posits that AI can significantly improve regulatory compliance by enhancing substantiation rates, shortening case closure times, and preserving key evidence. Fox’s perspective is shaped by the current challenges initially posed by the COVID-19 pandemic, which made traditional methods of internal interviews and company data analysis less feasible, and those challenges coming out of the pandemic.

He advocates using AI technology to search unstructured web and social media data, leading to more efficient and conclusive investigations. Furthermore, he underscores the importance of data preservation and the ability of AI to analyze large volumes of social media data, thereby reducing investigation length and promoting fair institutional justice. Join Tom Fox in this episode as he delves deeper into this fascinating topic.

Highlights Include:

  • Leveraging AI for Efficient Compliance Investigations
  • The need for speed
  • Enhancing Compliance Investigations with AI-Based Data Preservation

 Resources: 

Tom Fox 

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Innovation in Compliance

Innovation in Compliance – Tyler Barron on Streamlining Banking Compliance

Innovation comes in many areas, and compliance professionals must be ready for and embrace it. One of those areas is telehealth and telemedicine. My guest in this episode is Tyler Barron, Chief Revenue Officer at Encapture, who visits with me about innovation in banking compliance.

Encapture is a machine learning platform streamlining back-office processes for banks and lenders, particularly compliance and data reporting. Using document automation and machine learning, Encapture improves efficiency and reduces risk in the document lifecycle. The platform ensures accurate data submission to regulatory authorities and provides audit trails for regulatory purposes. Internal referrals are a powerful marketing tool that allows for an easier transition into becoming an approved supplier. The future of banking compliance lies in bringing intentional insight and value to financial institutions. Encapture aims to deliver year-over-year value and be seen as mission-critical to its client’s businesses. With increasing regulatory pressure, the need for efficient technologies like Encapture’s will continue to grow.

  • Encapture: Streamlining Document Lifecycle
  • Encapture platform: Providing audit trails for compliance
  • Internal Referrals
  • The Future of Banking Compliance
  • Simplifying Compliance for Banks

Resources

Tyler Barron on LinkedIn

EnCapture

Tom Fox

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Blog

Promoting Corporate Ethics Through Engaging Year-Round Activities

Corporate Compliance and Ethics Week will be held from November 5-11, 2023. It is designed to celebrate the compliance function in the corporate world. While many companies celebrate Corporate Compliance and Ethics Week as an annual event to raise awareness about these important topics, the philosophy behind it should be applied throughout the year and in a recent episode of the podcast “Creativity and Compliance” hosted by Tom Fox and Ronnie Feldman, discussed not only the significance of this week but equally significant, the importance of engaging year-round activities in promoting corporate ethics.

One of the key takeaways was the recognition that compliance programs often limit themselves to being fun and interesting only during Compliance Week. Ronnie highlighted the irony of this approach. He questioned why companies would only focus on engaging activities once a year when they inherently recognize that fun and exciting initiatives can have a lasting impact on compliance efforts. Feldman emphasized that the philosophy behind Compliance Week should be applied consistently throughout the year.

Engaging in year-round activities can take various forms. One approach Ronnie discussed is using creative methods such as talk shows, game shows, and workshops. These activities can make compliance more enjoyable and memorable for employees, fostering a culture of ethics and integrity. For example, Feldman shared an example of a client, an Insulin device company, that created a talk show called “Ethically Speaking with Your Host Sugar Levels.” This show allowed the compliance team to be interviewed in a fun and witty manner, making the subject of ethics more approachable and relatable.

Art exhibits were also discussed as a unique way to explore and discuss ethics and integrity. Progressive Insurance, for instance, organized an art exhibit where each piece of art had a tie-in to ethics and integrity. This approach allowed employees to engage with the subject matter more nuanced and thought-provokingly. Bringing art and ethics sparked meaningful conversations, promoting a deeper understanding of ethical principles.

Another exciting suggestion made in the episode was assigning compliance projects to millennials. This approach brings a fresh perspective and better engages a younger audience with different expectations and preferences regarding compliance efforts. By involving millennials in compliance initiatives, companies can tap into their creativity and innovative thinking, making compliance activities more relevant and impactful.

However, it is essential to consider the tradeoffs and challenges associated with engaging in year-round activities for promoting corporate ethics. Budget constraints, time limitations, and the need for continuous innovation can pose challenges for compliance professionals. They are finding the right balance between engaging activities and the practicalities of running a compliance program.

Ultimately, the impact of engaging year-round activities on promoting corporate ethics cannot be underestimated. Compliance programs can have a cultural impact on the entire organization if they are fun, engaging, thoughtful, empathetic, and do not waste people’s time. By investing time and effort into creative and exciting initiatives, companies can create a positive compliance culture that resonates with employees at all levels.

In conclusion, promoting corporate ethics through engaging year-round activities is a powerful approach to fostering a culture of integrity and compliance. Compliance programs should not limit themselves to being fun and exciting only during Compliance Week but should embrace the philosophy behind it throughout the year. Companies can make compliance more enjoyable, memorable, and relevant by using creative methods, such as talk shows, game shows, workshops, and art exhibits. Assigning compliance projects to millennials can bring a fresh perspective and engage a younger audience better. While challenges and tradeoffs may be involved, the long-term benefits of hiring year-round activities in promoting corporate ethics are worth the investment.

Check out the full Corporate Compliance Week 2023 episode with Tom Fox and Ronnie Feldman on Creativity and Compliance here.

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31 Days to More Effective Compliance Programs

One Month to a More Effective Compliance Program: Day 12 – A Seat at the Table

Going into the 2020s and beyond, a corporate compliance function must be integral to your business strategy. One of the key reasons is that the ever-important debate of compliance as a cost center will become more critical in the future in this decade. If compliance programs are ineffective, enforcement actions will continue to be highly costly. Over the last 10 years, there has been an increasing impact on the business where you must have compliance resources focused on remediation and business resources. This has only grown greater with reputational risks amplified by social media.

This is because as significant (and costly) as these regulatory fines and penalties have been, it is the intangible reputational damage that, in the long run, maybe even more expensive. Multiple stakeholders who might not desire to play out on the risk curve might be at higher risk, located in higher jurisdictions, or operating in higher-risk industries. Further, there are other consequential impacts if compliance does not have a seat at the table. Suppose compliance has a seat at the table. In that case, there can be some leeway for compliance officers and firms to figure out how best to roll out a compliance program that is commensurate with the organization’s risk and compliant with the regulations. If compliance is relegated to the back of the (corporate) bus, there will be little chance to do so.

Three key takeaways:

  1. It will be even more important for compliance to sit at the table in the future.
  2. Look for synergies with other types of compliance.
  3. Such synergies can be a big cost savings.

For more information, check out The Compliance Handbook, 4th edition, here.

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31 Days to More Effective Compliance Programs

One Month to a More Effective Compliance Program Through Innovation: Day 11 – Compliance Innovation Through KPIs

Measuring your compliance program’s effectiveness will be a critical criterion going forward. One of the mechanisms to do so is through Key Performance Indicators (KPIs). If you have been working towards your stated goals and reporting success, KPIs are critical in showing compliance program success or failure. And while specific requirements for this kind of reporting have been hotly debated in the industry for some time, KPIs are a regulatory requirement. Your KPIs will be specific and unique to your company and its business. Couple this with what goals you are trying to achieve as a whole as a compliance program, and you will see there is no set list of these metrics.

KPIs provide yet another mechanism for you to monitor and update your compliance program almost continuously. KPIs can be extremely low in cost and, therefore, something you can put in place without much approval from higher-ups in your organization that you might have to go to for budget approval. Finally, innovation can come in many ways. ComTech can be a huge jump forward. But sometimes innovation can occur at much less cost and a much more granular level. KPIs can be such a mechanism for you.

Three key takeaways:

  1. KPIs will be critical to assess a compliance program going forward.
  2. Set your KPIs.
  3. Decide on how to use KPIs and the blueprint for going forward.

For more information, check out The Compliance Handbook, 4th edition, here.

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2 Gurus Talk Compliance

2 Gurus Talk Compliance – Episode 15 – The I Don’t Like it Edition

What happens when two top compliance commentators get together? They talk compliance, of course. Join Tom Fox and Kristy Grant-Hart in 2 Gurus Talk Compliance as they discuss the latest compliance issues in this week’s episode! In this episode, Tom and Kristy take on a wide variety of topics, including a visit to Florida Women.

The landscape of corporate compliance is ever-evolving, with recent developments posing new challenges and opportunities for businesses. Compliance is a dynamic process that requires constant monitoring and retrospective reviews to identify potential risks and changes. He also emphasizes the importance of involving compliance officers early in the due diligence process of mergers and acquisitions and acknowledges the complexities of managing conflicts of interest in networking and hiring. Tom and Kristy advocate for a proactive approach to compliance, highlighting the importance of regulatory resources such as the New York State Department of Financial Services’ cybersecurity rules. She also stresses the need for clarity and certainty in compliance practices, particularly in areas like mergers and acquisitions and conflicts of interest. Join Tom Fox and Kristy Grant-Hart as they delve deeper into these issues in the latest episode of the 2 Gurus Talk Compliance podcast.

 Highlights Include:

  1. Albemarle FCPA enforcement action. (FCPA Blog)
  2. DAG Monaco on more credit for self-disclosure, this time in M&A. (Radical Compliance)
  3. NYDFS Comments on proposed cyber disclosure amendments. (Compliance and Enforcement Blog)
  4. Michael Lewis and SBF. (The Dig)
  5. Identifying compliance blind spots. (CCI)
  6. Lawmakers Press NBA, Players Union on Forced Labor (WSJ)
  7. Can you tell the difference between acceptable networking and wrongful hiring practices? (FCPA Blog)
  8. Crypto Sector Seeks Lawyers, Compliance Officers After Reputational Hits (WSJ)
  9. Stop Obsessing About Work All the Time (WSJ)
  10. Two women stole bags of food from Florida Taco Bell during armed robbery, deputies say (Fox 25 Orlando)

Resources 

Kristy Grant-Hart on LinkedIn

Spark Consulting

Tom

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Report from IMPACT 2023

Report from IMPACT 2023: Pat Harned on Collaborative Partnership for Ethics and Compliance

ECI’s IMPACT 2023 was one of the leading compliance events in 2023. At this conference, Tom Fox, the Voice of Compliance, was able to visit with several of the speakers, exhibitors, participants, and one group of ethically-minded Girl Scout Troop. In this limited podcast series, Report from IMPACT 2023, Tom explores many of the most cutting-edge topics in ethics and compliance through short podcast episodes. Check out the full series of interviews. You will be enlightened and informed and come away with a fuller and more thorough understanding of the most cutting-edge topics in ethics and compliance. In this episode, Tom visits Pat Harned, CEO at ECI.

Pat Harned, the CEO of the Ethics & Compliance Initiative (ECI), has spent many years observing the evolution of the ethics and compliance profession and has played a pivotal role in creating initiatives to keep professionals engaged in the field. Pat’s perspective on consumer behavior, corporate ethics, and compliance evolution is that these fields are converging, with employees and consumers increasingly expecting companies to be purpose-driven and have a positive global impact. She emphasizes the need for the ethics and compliance profession to take a thought leadership role in this convergence or risk being overshadowed by the growing prominence of ESG (Environmental, Social, and Governance) efforts. Pat’s views are shaped by her active involvement in dialogues with the Department of Justice and other regulators and her current leadership in establishing a Blue Ribbon Commission focusing on effective ESG efforts. Join Tom Fox and Pat Harned on this episode of the Report from Impact podcast to delve deeper into these insights.

 

Highlights Include:

  • The Rise of Purpose-Driven Consumerism
  • The Value of Experienced Professional Advisors
  • Collaborative Partnership for Ethics and Compliance

 Resources

ECI

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Innovation in Compliance

2023 Global Business Ethics Survey: Part 5 – Improving Ethics and Compliance Programs: Insights from 2023 GBES

The Global Business Ethics Survey (GBES) conducted by the Ethics & Compliance Initiative (ECI) provides valuable insights into workplace ethics and compliance from the perspective of employees. Tom Fox recently had the opportunity to visit with ECI CEO Pat Harned on the 2023 GBES. This survey has become a reliable benchmark for organizations to compare their workplace culture with third-party research, allowing them to identify areas for improvement and address potential risks.

Over the past 30 years of GBES research, ECI has identified and proven that certain “outcome” metrics are indicative of the well-being of workplaces from an ethics & compliance perspective. In this, the largest and latest update to the GBES body of research, employees in 42 countries around the world told us that there is reason for concern.

In Part 5 of a five-part podcast, we why companies need a strong ethical culture and high-quality compliance program.

Pat Harned, CEO of ECI (Ethics & Compliance Initiative) and a leading expert in workplace ethics and compliance programs, has extensive experience in the field and has led the 2023 Global Business Ethics Survey. Pat firmly believes that workplace ethics concerns are a significant issue and that compliance programs are necessary to address these concerns. Her perspective is shaped by alarming data showing high levels of pressure, increased observations of misconduct, and worrying rates of retaliation in the workplace. Pat advocates for the implementation of high-quality ethics and compliance programs, emphasizing the importance of manager engagement, regular reminders of reporting resources, anti-retaliation programs, and holding all employees accountable for ethical behavior. She also recommends regular assessments of these programs and their impact to ensure their effectiveness. Join Tom Fox and Pat Harned as they delve deeper into these issues in the upcoming episode of the 2023 GBES podcast.

Key Highlights:

  • Ethics and Compliance Challenges in Global Workplaces
  • Creating a Culture of Retaliation-Free Workplaces
  • Evaluating Organizational Performance with Global Benchmarks

Resources:

ECI

2023 Global Business Ethics Survey

Blog Post on the 2023 GBES, Part 5