Tag: compliance

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31 Days to More Effective Compliance Programs

One Month to a More Effective Compliance Program Through Innovation: Day 9 – The Competitive Advantage of Data

The DOJ and SEC have both made it clear that they expect companies to be more robust in their use of data analytics in compliance programs. This means using data not only to detect and prevent illegal conduct but also in the remediation prong of any best practices compliance program through continuous improvement. In 2019, former Deputy Assistant Attorney General Matthew Miner said in a speech that the DOJ will inquire whether compliance departments have access to internal data that could help them identify misconduct and whether compliance officers make adequate use of data analytics in their reviews of companies under investigation. Since at least 2016, in the FCPA enforcement action involving Key Energy Services, Inc., the SEC has been communicating to compliance professionals the need for increased use of data and data analytics in any compliance program.

The bottom line is that it is not if but when you begin to incorporate corporate information into your compliance program to make your compliance program more efficient, and your business process run more effectively. Let’s start now to identify the data you have access to and the data to which you currently do not have access. Find a way to bridge that gap.

Three key takeaways:

  1. DOJ pronouncements mandate CCO availability to and use of data.
  2. Data can be an actionable solution across geographic and business lines.
  3. Use data as a business strategy.

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

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Innovation in Compliance

2023 Global Business Ethics Survey: Part 3 – The Pervasive Issue of Retaliation in the Workplace

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 3 of a five-part podcast, we consider addressing workplace misconduct.

The 2023 GBES showed that within workplace ethics, retaliation, and whistleblower protection issues, retaliation is a pervasive issue in the workplace, with a significant number of individuals who report misconduct experiencing some form of retribution. The GBES revealed that retaliation remains unacceptably high, with many victims of harassment or discrimination choosing not to report due to fear of further retaliation. Pat emphasizes the importance of educating supervisors and coworkers to recognize and address retaliation, as well as supporting and educating employees who come forward about what retaliation might look like and how to handle it. Join Tom Fox and Pat Harned as they delve deeper into these issues on the 2023 GBES podcast.

Key Highlights:

  • Pressure to Compromise Workplace Standards
  • Lack of Support for Whistleblowers
  • What is retaliation?

Join us in Part 4, where we ask ‘what is an ethical culture”?

Resources:

ECI

2023 Global Business Ethics Survey

Blog Post on the 2023 GBES, Part 3

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31 Days to More Effective Compliance Programs

One Month to a More Effective Compliance Program Through Innovation: Day 7 – Skills for the Compliance Professional in 2025 and Beyond

What should compliance practitioners do to move themselves forward professionally in 2025 and beyond? To consider this question, I drew inspiration from the Financial Times (FT) piece entitled “Work in the 2020s: 5 essential skills to succeed” by Lyndsey Jones. In this article, Jones laid out five areas where workers need to have skills that will keep abreast of the ever-evolving marketplace. They are: (1) Adapt to thrive, (2) Be creative, (3) Develop emotional intelligence, (4) Become tech-savvy, and (5) Build your brand.

Being a compliance professional in the coming decade will be one of the most challenging, rewarding, and exciting professions for anyone to engage in. You have the opportunity to help lead not only your organization but also your profession. To paraphrase Alyson Van Hooser, will you put your (compliance) stake in the ground and own it? For your sake and the sake of the compliance profession going forward, I hope you will do so.

Three key takeaways:

  1. Adapt to thrive as you are only limited by your imagination.
  2. Build your brand and deliver.
  3. Be creative.

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

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Innovation in Compliance

2023 Global Business Ethics Survey: Part 2 – Addressing Workplace Misconduct

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 2 of a five-part podcast,  we consider addressing workplace misconduct.

Pat’s views on workplace misconduct have been shaped by her belief in the importance of a strong relationship between employees and their supervisors, which she sees as crucial to encouraging reporting of misconduct and ensuring satisfaction with the outcome. She advocates for training managers to respond supportively to reports and emphasizes the need for organizations to educate employees on the importance of reporting misconduct internally rather than resorting to social media or external agencies. With her extensive research and expertise, Harned has made significant contributions to promoting ethical practices in the workplace. Join Tom Fox and Pat Harned as they delve deeper into this topic on the 2023 GBES podcast.

Key Highlights:

  • Increasing Rates of Workplace Misconduct and Managerial Response
  • Global Reporting Trends in Corrupt Countries
  • The Impact of Supportive Managers on Reporting

Join us in Part 3, where we consider some disturbing findings on retaliation.

Resources

ECI

2023 Global Business Ethics Survey

Blog Post on the 2023 GBES, Part 2

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Adventures in Compliance

The Memoirs of Sherlock Holmes – Silver Blaze

The world of compliance investigations can be complex and challenging, requiring investigators to navigate through a maze of information and uncover hidden truths. In the podcast episode “The Adventure of Silver Blaze” on Adventures in Compliance, host Tom Fox explores the valuable investigative lessons that can be learned from Sherlock Holmes’ approach to solving mysteries. This episode focuses on the story of Silver Blaze, where Holmes uses his attention to detail, deductive reasoning, and pattern recognition skills to solve the case.

One of the key lessons highlighted in the episode is the importance of attention to detail. Holmes emphasizes the need to observe even the smallest details, as seemingly insignificant clues can provide crucial insights. Compliance investigators can apply this lesson by paying attention to every detail, no matter how trivial it may appear. By doing so, they can uncover hidden connections and gather valuable evidence.

Contextual analysis is another important factor in Sherlock Holmes’ investigative approach. Holmes examines the circumstances surrounding the crime and seeks to understand the broader context. He considers various factors, such as the behavior of people involved, the nature of the crime scene, and the motivation of the subjects. This lesson emphasizes the significance of understanding the context and building a comprehensive understanding of any case or investigation.

Deductive reasoning is a skill that Holmes is renowned for. He draws logical conclusions based on the available evidence and eliminates improbable scenarios. Compliance investigators can learn from this approach by using logical thinking to eliminate false leads and narrow down possibilities. By applying deductive reasoning, investigators can focus their efforts on the most relevant areas and make informed decisions.

Sherlock Holmes also emphasizes the value of disguised or unexpected evidence. In the story of Silver Blaze, Holmes notices the absence of expected evidence, such as the dog not barking, and deduces that a certain action was taken. This teaches investigators to look for the presence or absence of evidence that may be disguised or unexpected, as it can provide valuable insights.

Information gathering is a critical aspect of the investigative process, and Holmes emphasizes the importance of gathering information from various sources. He interacts with different characters, collects testimonies from multiple sources, and examines forensic evidence and documents. Compliance investigators can benefit from this lesson by gathering information from diverse sources to obtain a comprehensive understanding of the situation.

Pattern recognition is another skill that Holmes excels at. He is adept at recognizing patterns and connecting seemingly unrelated pieces of information. This ability allows him to identify the truth and solve the case. Investigators should develop pattern recognition skills to identify connections and associations that may lead to crucial breakthroughs. Data analytics can also play a role in pattern recognition, helping investigators find patterns in large amounts of data.

In addition to logical reasoning, Holmes also values intuition and creativity. He is open to unconventional ideas and thinks creatively to explore all possibilities. Compliance investigators can benefit from this lesson by being open-minded and thinking outside the box. Sometimes, unconventional or imaginative approaches uncover hidden insights and provide new perspectives.

Collaboration and consultation are also important aspects of Sherlock Holmes’ investigative approach. Holmes frequently collaborates with others, such as his trusted associate Dr. Watson, to exchange ideas and gain different perspectives. Investigators and compliance professionals can benefit from seeking advice or collaborating with colleagues to enhance their problem-solving skills and uncover new insights.

In conclusion, the episode “The Adventure of Silver Blaze” on Adventures in Compliance highlights the valuable investigative lessons that can be learned from Sherlock Holmes’ approach. Attention to detail, contextual analysis, deductive reasoning, information gathering, pattern recognition, intuition, creativity, collaboration, and consultation are all key factors that impact the effectiveness of applying Sherlock Holmes’ investigative lessons in compliance investigations. By incorporating these lessons into their investigative practices, compliance investigators can improve their ability to solve complex problems and uncover hidden truths.

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31 Days to More Effective Compliance Programs

One Month to More Effective Compliance Through Innovation: Day 6 – Future of Compliance Training

Where is compliance training headed? In the 2020 Update, the DOJ stated, “companies have invested in shorter, more targeted training sessions to enable employees to timely identify and raise issues to appropriate compliance, internal audit, or other risk management functions.” While this tactical solution has proven useful, I wanted to consider the broader compliance training themes that compliance professionals have learned over the past few years to gain insight into where compliance training may be headed. I sat down with Shawn Rogers, Senior Director, Global Ethics & Compliance at Stanley Black & Decker, Inc., to provide some thoughts on the veiled land of the future of compliance training.

Compliance training needs to get to the point where managers and leaders drive compliance training based on how they perceive the risks in their organizations. In other words, an awareness of risks can permeate the organization to such a degree that managers will be able to recognize when their employees need training and can call on the compliance function to provide custom training opportunities.

Three key takeaways:

  1. Business crises almost always begin with a culture failure.
  2. Focus your most detailed training on those employees who are truly high-risk.
  3. This is the “just-in-time” training model that provides training exactly when and where the employee needs the information.

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

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Sunday Book Review

Sunday Book Review: October 8, 2023 – The Compliance Books Edition

In the Sunday Book Review, Tom Fox considers books that would interest the compliance professional, the business executive, or anyone who might be curious. It could be books about business, compliance, history, leadership, current events, or anything else that might interest Tom. In today’s edition of the Sunday Book Review, Tom reviews four top books on compliance.

1.     Governance, Risk Management & Compliance by Richard Steinberg

2.     Corruption: The New Corporate Challenge by N. Kochan and R. Goodyear

3.     Anti-Money Laundering in a Nutshell: Awareness and Compliance for Financial Personnel and Business Managers by Kevin Sullivan

4.     The Business Guide to Effective Compliance and Ethics: Why Compliance isn’t Working – and How to Fix it by Andrew Hayward & Tony Osborn

Resource

Top 10 Compliance Books by Vivek Dodd

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31 Days to More Effective Compliance Programs

One Month to a More Effective Compliance Program Through Innovation: Day 5 – Communication to see Around Corners

The more you can operationalize compliance, the more it works to operationalize culture in your organization. It works for all levels of a company, literally from the Boardroom to the shop floor. The DOJ and SEC recognized this when they noted in their 2020 FCPA Resource Guide, “A compliance program should apply from the board room to the supply room – no one should be beyond its reach.” Yet culture can provide more than simply an ethical foundation, and it is also a part of the business foundation of an entity.

Using such an approach to communications allows a CCO to “see around corners” and can be one of the greatest strengths of a best practices compliance program. The reason is listening. Listening is a key leadership component, and there are certainly many ways to listen. You can sit in your office and wait for a call or report on the hotline, or you can go out into the field and find out what challenges employees are facing. From this, you can work with them to craft a solution that works for the company and holds to the company’s ethical and compliance values.

Using social media tools, a CCO can move towards Thomas’ next key ingredient of a successful corporate culture, which is trust. Thomas said, “I’m obsessive about the culture that we create specifically around trust, and this is an adjustment for some people when they come here. If you join our team, there’s trust by default here. That means you trust in the competence of your teammates. You trust in their intentions and what they’re saying. At some companies, the culture is that trust is earned over time, but that means if everyone in the organization says you have to earn trust, the amount of energy that actually goes into the trust-earning process is a distraction from our mission.”

Three key takeaways:

  1. A company can fail if it does not get its culture right.
  2. Using communications to “see around corners.”
  3. Trust works as a business strategy.

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

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From the Editor's Desk

From the Editor’s Desk – September and October, 2023 in Compliance Week

Welcome to From the Editor’s Desk, a podcast where co-hosts Tom Fox and Kyle Brasseur, EIC at Compliance Week, unpack some of the top stories that have appeared in Compliance Week over the past month, look at top compliance stories upcoming for the next month, talk some sports and generally try to solve the world’s problems.

Tom Fox and Kyle Brasseur are back. In this edition, they discuss the importance of robust compliance programs and proactive disclosures that must be balanced in today’s complex regulatory landscape. Tom underscores the significance of effective compliance measures and the innovative use of data analytics in enhancing compliance programs. He advocates for companies to prioritize these aspects to mitigate risks and improve their overall compliance posture. On the other hand, Brasseur emphasizes the need for companies to take proactive measures and implement effective compliance programs, citing a case where a bank’s failure to heed warnings resulted in a hefty financial penalty. He stresses that companies cannot afford to wait for regulatory action or assume that things will change in their favor. Join Tom Fox and Kyle Brasseur on this episode of the From the Editor’s Desk podcast as they delve deeper into this critical topic.

Highlights Include:

  • FCPA Settlement: Innovative Data Analytics Compliance
  • Deutsche Bank Affiliate’s Climate Disclosure Settlement
  • Shinhan Bank’s Lack of Compliance Program
  • Anti-Money Laundering Landscape in Europe
  • AI’s Impact on Compliance Landscape
  • Compliance Insights: Unveiling the CCO’s Perspective
  • NFL season to date
  • MLB playoffs are here
  • Dame Lillard trade and it’s fallout

 Resources:

Kyle Brasseur on LinkedIn

Compliance Week

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Blog

Pat Harned on Consumer Behavior, Corporate Ethics, and Compliance Evolution

I recently had the opportunity to visit with ECI President Pat Harned. We discussed consumer behavior, corporate ethics, and compliance evolution, which are three interconnected factors that play a crucial role in shaping the business landscape of today. We considered some of the key factors that impact them and the challenges associated with different approaches.

One of the major trends discussed in the episode is the growing importance of consumer behavior and responsibility. Consumers are increasingly willing to pay more for products from companies that are conscious of their global impact. This shift in consumer preferences has led to a rise in purpose-driven companies that prioritize ethical practices and sustainability. Employees, too, now prefer to associate themselves with organizations that have a positive impact on the world. As Tom Fox aptly puts it, “Employees are increasingly at the future workforces coming into workplaces with an expectation that they’re going to work for purpose-driven companies.”

This changing landscape has significant implications for corporate ethics and compliance. The ethics and compliance profession is evolving to emphasize corporate values and purpose. The Ethics & Compliance Initiative (ECI) aims to lead in this area by equipping professionals with the tools they need to navigate the complex regulatory environment. Experienced professionals in the ethics and compliance field are crucial for organizational success, and ECI engages senior advisors to mentor leaders and provide guidance.

However, this evolution also brings forth challenges. The role of the compliance officer is becoming more tied to senior levels of the organization, with liability attached to it. Compliance officers now have a seat at the table, but with that comes the responsibility to take action on the big problems that society is increasingly facing. As Tom Fox points out, “The next generation of employees is looking at companies and saying when are they going actually to be taking action on some of these big problems?”

To address these challenges, collaboration with regulatory bodies such as the Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) is vital. The DOJ and SEC will often seek input from ethics and compliance practitioners on essential topics that impact compliance officers and businesses. This is a key role for ECI to help play with the compliance community to facilitate this public/private partnership. This partnership ensures that the compliance profession plays a leadership role in ethics, sustainability, and governance. As Tom Fox mentions, “It has been a very nice development to see that they’re interested in the input from our profession.”

The episode also highlights the importance of ECI’s role as a thought leader in the ethics and compliance space. With the convergence of various fields, such as ESG (Environmental, Social, and Governance), ethics and compliance professionals need to stay ahead of the curve. ECI is putting together a blue-ribbon commission to examine what an effective ESG effort looks like and how it ties to corporate purpose and values. This initiative aims to help companies meet the growing expectations of employees and consumers.

In conclusion, consumer behavior, corporate ethics, and compliance evolution are intertwined factors that shape the business landscape. The preferences of consumers and employees are driving the rise of purpose-driven companies, emphasizing the need for ethical practices and sustainability. The ethics and compliance profession is evolving to meet these demands, with ECI leading the way. Collaboration with regulatory bodies and thought leadership initiatives are crucial for navigating complex challenges and ensuring a positive impact on society. As we move forward, organizations need to consider the effect on consumer behavior, corporate ethics, and compliance evolution when making decisions.