Tag: compliance

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31 Days to More Effective Compliance Programs

One Month to a More Effective Compliance Program: Day 15 – Employment Separation Issues and Compliance

Employment separation and layoffs can present some unique challenges for the compliance practitioner. Employees can use layoffs to claim that they were retaliated against for a wide variety of complaints, including those for concerns that impact the compliance practitioner. Yet there are several ways that operationalization will help to protect your company as much as possible.
The reasons for these actions are to allow you to demonstrate that any laid off employee was not separated because of a hotline or whistleblower allegation but due to your overall layoff scheme. However, it could be that you may need this person to provide your compliance department additional information, to be a resource to you going forward, or even a witness that you can reasonably anticipate the government may want to interview. If any of these situations exist, if you do not plan for their eventuality before you lay off the employee, said (now) ex-employee may not be inclined to cooperate with you going forward. Also, if you do demonstrate that you are sincerely interested in a meritorious hotline complaint, it may keep this person from becoming a SEC whistleblower.

Three key takeaways:

  1. Treat departing employees with dignity.
  2. Make sure your separation documents meet SEC requirements regarding disclosures re: whistleblowing.
  3. You must check your hotline and anonymous reporting systems to make sure you do not lay off a whistleblower.

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

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10 For 10

10 For 10: Top Compliance Stories For the Week Ending August 19, 2023

Welcome to 10 For 10, the podcast which brings you the week’s Top 10 compliance stories in one podcast each week. Tom Fox, the Voice of Compliance brings to you, the compliance professional, the compliance stories you need to be aware of to end your busy week. Sit back, and in 10 minutes hear about the stories every compliance professional should be aware of from the prior week. Every Saturday, 10 For 10 highlights the most important news, insights, and analysis for the compliance professional, all curated by the Voice of Compliance, Tom Fox. Get your weekly filling of compliance stories with 10 for 10, a podcast produced by the Compliance Podcast Network.

·       Ukraine ABC lessons from Afghanistan. (NPR)

·       Paxton allegedly created fake Uber account to engage in corruption.  (Texas Tribune)

·       Inotiv facing FCPA issues around importing monkeys for research. (WSJ)

·       BNSF tries to settle massive data privacy claim.  (Reuters)

·       Federal corruption investigation heating up in Ohio. (Ohio Capital Journal)

·       SEC Whistleblower Program growing pains.  (WSJ)

·       African Development Bank not using ABC funds. (FT)

·       Aide to Madagascar leader arrested for corruption.  (FT)

·       Grupo Aval settles FCPA enforcement action. (WSJ)

·       Health care corruption sweep in China. (South China Morning Post)

You can check out the Daily Compliance News for four curated compliance and ethics related stories each day, here.

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Compliance and AI

Compliance and AI-Julie Myers Wood on Navigating the AI Compliance Landscape: Mitigating Risks

What is the role of Artificial Intelligence in compliance? What about Machine Learning? Are you using ChatGPT? These questions are but three of the many questions we will explore in this exciting new podcast series, Compliance and AI. Hosted by Tom Fox, the award-winning Voice of Compliance, this podcast will look at how AI will impact compliance programs into the next decade and beyond. If you want to find out why the future is now, join Tom Fox on this journey to the frontiers of AI.

Welcome back to another exciting episode of our podcast, where we delve into the fascinating world of compliance and artificial intelligence (AI). Today, we have the pleasure of hosting Julie Myers Wood, CEO of Guidepost Solutions. With her extensive background in law and government positions, Julie brings a wealth of knowledge and insights to our discussion on the challenges and considerations of incorporating AI into compliance programs.

As compliance professionals, we play a vital role in ensuring the safety and security of our businesses. The integration of AI into compliance programs presents both challenges and opportunities. By understanding the tools, risks, and solutions associated with AI, we can adapt to the changing landscape and make informed decisions.

Let’s embrace this exciting era of AI while staying vigilant and proactive. The world is changing, and compliance professionals need to stay up to date to ensure the safety and security of our businesses. Thank you, Julie Myers Wood, for sharing your valuable insights, and we look forward to more enlightening discussions in the future!

Remember, compliance professionals are the co-pilots of our businesses, guiding us through the complexities of the AI revolution. Let’s not wait too long between podcasts and continue this journey together!

Key Highlights

  • Key Considerations for Compliance and AI
  • Importance of Inventorying Tools and Managing Risks
  • AI and Intellectual Property Protection
  • Challenges of Implementing AI
  • AI and Compliance

 Resources

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Guidepost Solutions

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Blog

Julie Myers Wood on Navigating the AI Compliance Landscape: Mitigating Risks

I recently had the opportunity to visit with Julie Myers Wood, CEO at Guidepost Solutions. With her extensive background in law and government positions, Julie brings a wealth of knowledge and insights to our discussion on the challenges and considerations of incorporating AI into compliance programs. We took a deep dive into the intersection of compliance and artificial intelligence (AI).

With generative AI is coming at us with light speed, there are so many things a compliance professional to think about. Julie began with the first key thing is to take a high level perspective to step back and reflect on all the ways that AI can affect your company. You should ask several questions, including some of the following. What AI tools is the company using internally? What tools is the company using internally to help its operations or its capacity know about those tools? What is your company selling? Is your company selling tools that incorporate deep learning, generative AI or other sorts of machine learning?

Equally importantly what is the compliance part that each of your team is performing? What compliance tools are being used? Do you have individuals who are freelancing at your company trying to reduce their work using GPT or something else without telling you and maybe exposing some of the code? And finally, how are criminals using generative AI to get into your work? It all entails that , from a high-level perspective, what are various ways that AI can affect you.

Next it is important to think about is do you know what all these tools are that the company is using? You need to obtain an inventory of tools your employees are using. Compliance professionals need to have a comprehensive inventory of the tools being used within the company and fully comprehend their capabilities and limitations. This may not be easy, particularly if your organization is using a mix of homegrown tools as well as tools that are available for sale on the open market. Your compliance team must understand what are the tools that each part of the company is using because only then can you fully understand the privacy or other regulatory risks that may be involved.

In this inventory, you also need to understand who owns the software tools. When do they expire, how many seats to you have for your organization? Who owns the license keys and does the software legacy out?  This understanding is crucial for effectively managing compliance and mitigating potential risks. It is also a very good business practice.

Generative AI is rapidly advancing, and compliance professionals must stay informed and proactive in addressing its implications. Julie highlights the need to be aware of the risks related to generative AI, export compliance, and other potential problems. By staying updated on the latest developments, compliance professionals can adapt to the changing landscape and make informed decisions.

There are potential dangers of integrating AI into businesses and offers solutions to mitigate them. One key solution involves retraining or supplementing the training of employees. Companies need to educate their workforce on the rules of the road and provide a safe environment for exploring and experimenting with generative AI. Julie pointed to PwC’s billion-dollar investment in AI, including retraining and proprietary platforms, showcases the importance of investing in employee development. However, smaller companies may face challenges in investing in generative AI and effectively implementing it.

AI is revolutionizing compliance by enabling effective analysis and interpretation of large amounts of data. Compliance professionals are excited about the potential of AI for predictive analytics and identifying trends and patterns. However, choosing the right tools for compliance is crucial, as market winners and losers can impact success. A key for success for the compliance team is the need for collaboration between operations and compliance teams when considering the use of AI.

Clear policies defining what can and cannot be done with AI are essential to protect intellectual property and ensure compliance. But it is not simply policies and procedures, it is targeted and effective training, coupled with ongoing communications. All of this should be aimed at educating employees about the risks and consequences of using AI improperly is crucial. Compliance professionals should encourage caution when downloading AI tools from the web and carefully review terms and conditions to avoid unintended consequences.

As compliance professionals, we play a vital role in ensuring the safety and security of our businesses. The integration of AI into compliance programs presents both challenges and opportunities. By understanding the tools, risks, and solutions associated with AI, we can adapt to the changing landscape and make informed decisions.

For the full podcast with Julie Myers Wood, check out Compliance and AI here.

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31 Days to More Effective Compliance Programs

One Month to a More Effective Compliance Program: Day 14 – Hiring A CCO: Developing The Job Profile

What should a company do when it desires to hire a CCO? To do so, a company needs to fully understand and appreciate what it needs from such a position going forward. Unfortunately, many companies do not have this insight at the beginning of the recruitment process. The key company stakeholders need to understand the full hiring process. Obviously, this will include HR and others involved in the hiring process for a CCO for the company. It could include the CEO, COO, CFO, CISO, Head of IA and others. They may need to rethink their approach to focus on what they will ask the new hire to accomplish because typically there is a disconnect between what the company thinks it needs and what it really needs.

Tom highlights the importance of developing a comprehensive job profile. Maurice Gilbert provides insights on the topic, emphasizing the need for companies to understand their specific needs and risks when creating a job profile for the CCO position. The podcast also discusses the importance of involving key stakeholders, setting realistic expectations, and considering professional growth opportunities and an attractive package for potential candidates. By involving key stakeholders in defining the role of the CCO and seeking the assistance of a professional executive recruiter, companies can find the right fit for their compliance program’s success.

Three key takeaways:

  1. Bring in your key stakeholders to flesh out the job description.
  2. Consider the top four things you would like a new CCO to accomplish in the first year.
  3. For a new CCO to succeed, the company must have a realistic expectation developed before the process begins.

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

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2 Gurus Talk Compliance

2 Gurus Talk Compliance – Mary Releases A Book 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 cover a range of topics including new anti-money laundering rules, India’s requirement for auditors to report suspected fraud, FCPA enforcement, messaging app compliance, compliance budget challenges, the settlement of an FCPA case, changing work dynamics, the purpose of a corporation, and the impact of ESG factors on corporate governance. They discuss the American Bar Association’s delayed support for anti-money laundering efforts, India’s significant change in auditor reporting rules, SEC enforcement of messaging app compliance, and the potential settlement of an FCPA case. They also emphasize the need for businesses to adapt to changing work styles and values and the benefits of incorporating ESG factors into corporate decision-making.

Highlights Include

  1. ABA agrees to new client due diligence rules.
  2. Mary Shirley releases a new book.
  3. More messaging app non-compliance fines.
  4. Albemarle makes FCPA settlement reserve.
  5. Capitalism at an Inflection Point?
  6. New India rules require auditors to report suspected bribery and kickbacks to the government.
  7. Grupo Aval FCPA Settlement.
  8. Stretching Your Compliance Budget.
  9. Leaving the Office at 5 Is Not a Moral Failing.
  10. Florida woman doused herself in Diet Mountain Dew to erase DNA after killing roommate, 79.

 Resources 

  1. WSJ
  2. Amazon
  3. WSJ
  4. FCPA Blog
  5. CCI
  6. WSJ
  7. Radical Compliance
  8. NYT
  9. NY Post
  10. Corruption, Crime and Compliance

Connect with Kristy Grant-Hart on LinkedIn

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Blog

Executive Compliance Comp and Compliance: From Incentives to Clawbacks

There are two problems that every company must deal with at the intersection of executive compensation and compliance. The first is the presence of perverse incentives within organizations, where executives are often encouraged to take excessive risks because they personally profit from them. This misalignment of incentives can lead to unethical behavior and non-compliance, ultimately harming the organization and its stakeholders. The second is both the Securities and Exchange Commission (SEC) and Department of Justice (DOJ) mandates for executive clawbacks.

Incentives

To address this issue, companies need to tie positive incentives directly to senior executives. By holding them accountable for compliance failures, we can align their compensation with compliance objectives. This approach ensures that executives have a personal stake in maintaining ethical practices within the organization. What makes this approach unique is that it is a business response to a legal problem, rather than a government mandate. A business response is always a better way to go, as it allows organizations to take ownership of their compliance programs and tailor them to their specific needs.

Various proposals are discussed in the podcast to ensure senior executives are held personally accountable for compliance failures. One solution, suggested by William Dudley, former president of the Federal Reserve Bank of New York, is for senior management and material risk takers to forfeit their performance bond in the case of large fines. This not only disciplines individual behavior and decision-making but also incentivizes individuals to flag issues when problems arise.

Another approach, outlined in an article titled “Ties That Bind Codes of Conduct,” recommends automatic reduction of pay for officers, directors, and advisors for failures of corporate governance. Executives would agree to pay back a portion of their gross compensation for a set period before the beginning of any improprieties, regardless of their knowledge of misdeeds within the company.

While corporate leaders may not be enthusiastic about being held accountable, these proposals offer a business solution to a legal problem. Holding senior executives responsible for the conduct of others aligns with their obligations under Sarbanes-Oxley and ensures that they are not shielded from the consequences of non-compliance. Shareholders are also becoming less accepting of the argument that leaders should not be responsible for the actions of their employees.

Data from an article by Gretchen Morgenson titled “Ways to Put Your Boss’s Skin in the Game” further supports the need for accountability in executive compensation. The article explores how to make senior executives more responsible for corporate malfeasance, with implications that apply to compliance programs and compensation tied to compliance.  Creating accountability in executive compensation is a critical step towards promoting ethical business practices and compliance within organizations. By tying positive incentives to senior executives, we can ensure that they have a personal stake in maintaining compliance objectives. The proposals discussed in the podcast, such as forfeiting performance bonds and enforcing pay reductions for failures of corporate governance, offer practical solutions to address perverse incentives and drive ethical behavior.

Clawbacks

Clawbacks, often seen as a form of guarantee for businesses, play a vital role in addressing employee misconduct. These provisions, typically included in written contracts, serve as a deterrent and allow organizations to reclaim incentive or bonus funds from employees engaged in wrongful activities. It is important to note that clawbacks apply to compensation received as incentives or bonuses, rather than salary.

The SEC has provided guidance on constructing effective clawback provisions. In their final rule titled “Listing Standards for Recovery of Erroneously Awarded Compensation,” (the Rule) the SEC directs National Securities Exchanges and Associations to establish listing standards for issuers to develop and implement policies for recovering incentive-based compensation in the event of required accounting restatements.

The DOJ has also weighed in on subject of clawbacks, most recently in the 2023 Evaluation of Corporate Compliance Programs (ECCP), it stated “Are the terms of bonus and deferred compensation subject to cancellation or recoupment, to the extent available under applicable law, in the event that non-compliant or unethical behavior is exposed before or after the award was issued? Does the company have a policy for recouping compensation that has been paid, where there has been misconduct? Have there been specific examples of actions taken (e.g., promotions or awards denied, compensation recouped or deferred compensation cancelled) as a result of compliance and ethics considerations?”

In summary, both the SEC and DOJ have now laid out the foundations for both incentives and consequence management.

SEC: The SEC Rule encompasses a wide range of scenarios. Companies are required to claw back incentive compensation erroneously received by current or former executives during the three-year period preceding the required restatement date. The definition of “received” is broad, considering incentive compensation earned even if not yet paid. The recoverable amount may differ from what executives would have received based on the required restatement. The SEC rule prohibits companies from obtaining indemnity insurance to protect executives from clawbacks. This step ensures that executives are held personally accountable for their actions and fosters a culture of compliance within organizations.

DOJ: In the ECCP has emphasized the significance of clawbacks in compliance programs. The ECCP directs companies to develop and apply compensation and clawback policies, shifting the burden of financial penalties away from innocent shareholders. The clear intent to prevent companies from shielding employees involved in illegal and unethical conduct. The DOJ will consider whether a company has incentivized compliance by designing compensation systems that defer or escrow certain compensation tied to conduct consistent with company values and policies. Enforcement of a contract provisions that permit the company to recoup previously awarded compensation if the recipient of such compensation is found to have engaged in or to be otherwise responsible for corporate wrongdoing is now a critical metric that prosecutors will consider. Finally, prosecutors may consider whether provisions for recoupment or reduction of compensation due to compliance violations or misconduct are maintained and enforced in accordance with company policy and applicable laws.

 Practical Steps

To create a robust compliance program that promotes ethical behavior and compliance, companies should consider the following practical advice:

  1. Documented Policies and Procedures: It is crucial for companies to document and reflect clawback policies and procedures in their compensation agreements. This documentation showcases a commitment to compliance and serves as a deterrent for potential misconduct.
  1. Clear Disciplinary Procedures: Companies should have appropriate and clear disciplinary procedures in place when enforcing a compliance program. Publicizing disciplinary actions internally and under local law can have a deterrent effect on employees, emphasizing the consequences of engaging in unlawful or unethical behavior.
  1. Personal Accountability: The DOJ and SEC prioritize holding individuals accountable for misconduct. Prosecutors evaluate whether a corporation’s compensation agreements incorporate clawback provisions that enable penalties to be levied against employees, executives, or directors involved in criminal conduct.

 Conclusion

Clawback provisions have become a crucial element in compliance programs, promoting ethical behavior and ensuring accountability within organizations. The SEC Rule, along with the DOJ’s emphasis on clawbacks from the Monaco Memo to the ECCP, highlights the significance of these provisions in the business world. By implementing well-documented clawback policies, companies can create a culture of compliance that rewards ethical behavior and protects innocent shareholders. Both initiatives prioritize ethical practices and compliance to build a better business environment for all stakeholders.

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31 Days to More Effective Compliance Programs

One Month to a More Effective Compliance Program: Day 13 – Compliance Performance Appraisal Review

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:

  1. To incentivize compliance, you must be able to accurately appraise senior managers and employees around compliance.
  2. Clearly communicate your compliance expectations, then fairly evaluate employees on them.
  3. Consider conducting an ongoing review.

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: Day 12 – Succession Planning Around Compliance

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:

  1. Succession planning is just as important as governance, enterprise risk and strategic oversight.
  2. Do not begin your succession planning when a senior manager announces their retirement.
  3. You are always being evaluated (or you should be).

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

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Blog

The Power of Compensation: Building a Culture of Compliance

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.

  1. 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.
  1. 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.
  1. 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.
  1. 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.
  1. 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.
  1. 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.