Tag: ESG

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Great Women in Compliance

Debra Sabitini Hennelly, Part 2 series: Burnout, ESG and Ethical Leadership

Welcome to the Great Women in Compliance Podcast, co-hosted by Lisa Fine and Mary Shirley.

Following on from our Part 1 from last week, we invite Debbie Sabatini Hennelly back for the second part of series where we discuss how a book became a deliverable that helped Debbie work through burnout which ties in nicely with the burnout discussion commenced in the first episode.  As someone who was previously an environmental lawyer, Debbie is one of the few people who is legitimately an ESG expert and shares with us some thoughts about how companies ought to approach ESG, as well as giving her view on whether or not Compliance should own ESG.  We also ask for Debbie’s advice about being a great leader and how to manage upwards when you have a difficult boss.

 The Great Women in Compliance Podcast is on the Compliance Podcast Network with a selection of other Compliance related offerings to listen in to.  If you are enjoying this episode, please rate it on your preferred podcast player to help other likeminded Ethics and Compliance professionals find it.  You can also find the GWIC podcast on Corporate Compliance Insights where Lisa and Mary have a landing page with additional information about them and the story of the podcast.  Corporate Compliance Insights is a much-appreciated sponsor and supporter of GWIC, including affiliate organization CCI Press publishing the related book; “Sending the Elevator Back Down, What We’ve Learned from Great Women in Compliance” (CCI Press, 2020).

You can subscribe to the Great Women in Compliance podcast on any podcast player by searching for it and we welcome new subscribers to our podcast.

Join the Great Women in Compliance community on LinkedIn here.

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The ESG Compliance Podcast

Optimizing ESG Opportunity in the Pandemic with Laura Tulchin


Consulting expert Laura Tulchin passionately advocates the implementation of ESG, working in the mantra of “minimizing risk today means optimizing opportunity.”
In this episode, she dives deep into the growing significance of ESG in the pandemic, the social and monetary advantages, the cruciality of regulation, and how ESG is looking into the future.
▶️ Optimizing ESG Opportunity in the Pandemic with Laura Tulchin
Key points discussed in the episode:
✔️ Laura Tulchin summarizes her professional and educational background.
✔️ Laura Tulchin explains the increasing relevance of ESG in the past two years. Companies with perceived good ESG performance are financially outperforming their competitors.
✔️ESG gains steam in today’s fractured social and capitalist system. Consumers are seeking purpose, even in the way they spend their money. Transparency in ESG is enough incentive for companies to step up.
✔️ The formation of the International Sustainability Standards Board in the 2021 UN Climate Change Conference was a step forward for ESG standardization. Laura Tulchin believes that we still have a long way to go. A hodge-podge of voluntary standards still remains in the ISSB, along with jurisdictional regulations in the EU.
✔️ Interpretation and analysis – or looking under the hood – are still challenging in ESG reporting. The necessary tools needed to achieve a higher level of transparency aren’t readily available. Some businesses resort to presenting a positive but generalized report to gain mass favor.
✔️ ESG isn’t a one-size-fits-all program. It’s bound to be managed in different ways across industries.
✔️Compliance lays a strong foundation for a good ESG program.
✔️ ESG should be an accurate portrayal of an organization’s social and environmental impact.
✔️ ESG isn’t just about saving the elephants. It’s also about saving your dollars. Running an ESG program brings long-term profit. Nowadays, consumers are more conscious of who they’re buying from and whether products are ethically sourced and manufactured.
✔️ ESG would soon become a natural business practice.
Laura Tulchin is an MBA with expertise in ESG risk, compliance, and governance. She has extensive experience with investment professionals, large multinationals, and financial institutions in managing risk and bringing the right frameworks, processes, and tools for risk management. She is hands-on with big-data and technology implementation experience to help clients determine strategic vulnerabilities and use data effectively to understand, measure and mitigate risk.
Connect: https://www.linkedin.com/in/laura-tulchin-b5577611/

Categories
The ESG Report

Meta-Contract and the ‘G’ in ESG with David Simon


 
In this episode of The ESG Report, David Simon, author of the LinkedIn article ‘The “G” in ESG, is Tom Fox’s guest. They discuss the article’s content as well as the role of compliance in governance. 
 

 
The Link Between a Company’s Meta-Contract and Governance 
The term ‘meta-contract’ was coined by one of David’s Oxford professors, Alan Morrison. A meta-contract is what an organization is all about, including how it will and won’t do business. Governance refers to how well or how poorly a company adheres to its meta-contract. Tom mentions that monitoring this is something compliance professionals do day in and day out, and David agrees; ensuring that a company behaves consistently with its values is something compliance professionals are best at.
 
Incorporating Stakeholders’ Views in a Company
Once you accept stakeholder capitalism, you must ask yourself, ‘Where do I draw the line?’ To David, from an ESG perspective, the key to answering this is authenticity and integrity, “Look at your values and who your stakeholders are, and rank them in terms of priority. It’s a very individualized exercise, and it’s important for company leadership to be honest and look at who they are, and what they aspire to be.” He resists the idea of everybody fitting into the same box, because, “It’s bound to fail; I don’t think it really represents their true meta-contracts.”
 
The Importance of Compliance in Corporate Governance 
David points out that compliance professionals are really well-suited to take the meta-contract and implement it in a way that’s enforceable and consistent throughout the organization. One of the great things about ESG is that it allows compliance to broaden its horizons. Compliance can get very focused on true compliance with the law or regulatory regimes, but there are certain violations and scandals that are worse than others, and that ties to what their meta-contract is. These violations may not  be violations of the law, but rather, violations of who they are as an organization. David comments on this, “From a compliance perspective, compliance professionals need to think more broadly than just the laws; more about what their organizational meta-contract is, and take steps to avoid violating it.”
 
RESOURCES 
Tom Fox’s email
David Simon | Twitter | LinkedIn | The “G” in ESG: Governance 
 
 

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The ESG Compliance Podcast

ESG Through a Legal Lens with Christian Perez-Font


Christian Perez-Font has one of the most unique law practices I’ve come across.
We spoke at a conference around three years ago, and we’ve kept in touch since then. I’ve had him come on several podcasts to talk about his analytical and data-driven approach to legal issues in the world of ESG.
Watch ▶️ ESG Through a Legal Lens with Christian Perez-Font
Key points discussed in the episode:
✔️ Christian Perez-Font gives us a background on his professional experience – a lawyer by trade who sees compliance as business support. He also defines the mantra of his company, Thinkeen Legal.
✔️ The right perspective going into data tracking and analyzing – seeing data as fuel for your business and a measure of progress.
✔️ The intersection of ESG and compliance in social responsibility and governance.
✔️ Manufacturing companies are cognizant of the environmental aspect of ESG. However, “E” goes beyond companies with plants subjected to carbon footprint regulation.
✔️ Data analytics is all about utilizing and presenting relevant data.
Don’t be the Instagram of corporations. You don’t have to publish every number for investors to avoid the threat of transparency.
✔️ Track political contributions. Talk about diversity.
✔️ There are no a-ha moments in data tracking. Don’t wait for the trends to pass. Start now, then it’ll be easier to spot any spikes or changes so you can quickly make adjustments to your ESG program.
✔️ Data shouldn’t be used to prove how good a company is. It should be to learn and know if you’re on the right track.
✔️ The role of the auditor in data tracking.
✔️Data analytics and tracking play a major role in business acquisitions. Know as much as you can about the other. Understand the company’s ESG program and have a clear grasp of its social responsibility and environmental footprint.
✔️ Trade sanctions and trade compliance have become a huge part of data analysis in ESG.
✔️Using data visualization to convince your board that the ability to present information is a valuable asset.
✔️Changing policies isn’t a sign of weakness but of progress.
Christian Perez-Font is the managing partner of Thinkeen Legal, a law firm that specializes in corporate and commercial law, domestic and cross-border transactions, and compliance with a focus on startups, small and mid-sized companies. His company has experience in many industries but we are particularly strong in healthcare. They also offer outside general counsel services to clients who are not yet ready to hire an in-house counsel or those in need of a secondment while they fill a position. They have significant external and in-house legal experience having worked for premier firms and multinational companies such as Arnold & Porter, Baker & McKenzie, Baxter International, Olympus Corporation, and OPKO Health, Inc. They have been clients so they understand that Legal is a business support function.
His aim is to add value by delivering simple and pragmatic business advice with a legal content.

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This Week in FCPA

Episode 291 – The Rams Win It All Edition


Super Sunday passed with fun but poorly played, poorly officiated, and poorly coached. Tom and Jay are back to look at some of the week’s top compliance and ethics stories this week in the Rams Win It All Edition.
Stories

  1. Ericsson is in more FCPA trouble. Mengqi Sun in the WSJ Risk and Compliance Journal. Aaron Nicodemus in Compliance Week. (sub req’d)
  2. DD impeding compliance in developing markets? Katya Lysova explores in the FCPA Blog.
  3. ESG-no longer a nice to have. Karen Alonardo in Risk and Compliance Matters.   
  4. State AGs are waiting. Ashley Taylor and Chris Carlson in CCI.  
  5. The latest case on CCO liability. Matt Kelly in Radical Compliance. 
  6. Broken windows and compliance enforcement. Anthony O’Reilly in Compliance and Enforcement. 
  7. Companies yet again ask the EU for rules around ESG. Lawrence Heim inpracticalESG.
  8. White-collar enforcement trends in 2021. Jamie Rosenberg in Grand Jury Target.  
  9. HP-Autonomy from the auditors’ perspective. Francine McKenna in The Dig. 
  10. South African courts deny Zuma’s attempt to remove the SA corruption prosecutor. Rick Messick in GAB.  

Podcasts and More

  1. In February on The Compliance Life, I visited Ellen Smith, a former Director of Trade Compliance who recently started her consulting firm. In Part 1, she discussed her academic background and early professional career. In Part 2, Ellen discussed her move in-house. In Part 3, Ellen discusses being a part of the Compliance Dream Team at Weatherford.
  2. Tom and Richard Lummis are in the middle of their annual review of Best Picturing winning movies on 12 O’Clock High, a podcast on business leadership. Part 1 reviews Schindler’s List for leadership and ethical lessons. In Part 2, the look at Gladiator.
  3. CCI releases a new e-book from Mike Volkov, “Compliance Culture Revolution.” Available free from CCI.
  4. Tom looks at some innovation in compliance with a 3-part blog post series in the FCPA Compliance and Ethics Blog. Topics include Compliance Ecosystem Governance, Compliance Branding, Building Culture & Compliance Coaching.
  5. Are you a Star Wars fan? How about an uber-Geek? You will love the 5-part series appearing next week on the Greeting and Felicitations podcast series on the Compliance Podcast Network if you are either or both. In this series, Tom visits astrophysicist Dr. Ben Locwin on the following topics: Traveling in Hyperspace, Fighting with a Light Saber, Mechanical Prosthetics, Cyborgs and Robots, and the Death Star. It is a ton of fun, and you will love it. Each episode will post at 10 each day next week. Check it out daily. 

Tom Fox is the Voice of Compliance and can be reached at tfox@tfoxlaw.com. Jay Rosen is Mr. Monitor and can be reached at jrosen@affiliatedmonitors.com.  

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ESG Compliance Podcast

Exploring ESG from the European Perspective with Bryan Sillaman


Bryan Sillaman, Head of the Paris office of Hughes Hubbard & Reed LLP, returns to the show to share the breadth and scope of some of the regulatory frameworks already in place, what the green taxonomy is all about and how it relates to an overall ESG program. 
 ▶️ Exploring ESG from the European Perspective with Bryan Sillaman.
Key points discussed in the episode:
(00:30) Bryan Sillaman shares his current practice and interesting evolution from a white-collar defense lawyer to an ESG aficionado.
(01:28) The key differences in the regulatory approach to ESG between the EU and US.
(02:34) The robust and rigorous exercise at a scientific and technical level to define sustainable activity versus not generating different opinions & viewpoints. Bryan expects this lengthy process in the EU in 2021 to become a lot more in 2022.
 (03:49): The EU has been ahead a bit on the front where the United States is in terms of the ESG regulatory approach. Sillaman shares that this is part of what’s driven by the regulatory framework, but even more so, as companies face pressure from their investors, employees, unions, NGOs and various stakeholders.
(05:04): Companies claim to be involved in sustainable activities but not really involved. And it comes back to the concern of greenwashing and establishing the taxonomy set out to define at a technical and scientific level what is sustainable and what is not.
(08:07) The sustainable financial disclosure regulation and its operation into an overall ESG framework. It requires asset managers as financial market participants to first disclose how much of their activities are aligned with the taxonomy.
(09:19) The Corporate Sustainability Reporting Directive and how it fits in.
(10:50) With directives defined, Bryan shares where he sees EU reporting standards for ESG headed and envisioned as the technical criteria will evolve over time. 
(12:57) ESG has become a really top-of-mind issue for many companies and institutions. Sillaman shares that this is part of what’s driven by the regulatory framework, but even more so, as companies face pressure from their investors, employees, unions, NGOs and various stakeholders. 
(14:13) Interesting trends for 2022 following the regulatory Bryan cites interesting cases and lawsuits brought by NGOs to pursue reductions in carbon emissions and other damages against companies. 
(17:30) Several countries pass enhanced disclosure and due diligence requirements on the supply chain, and companies are operating in their jurisdiction focus on human rights issues. 
(19:20) The S or social aspect part of ESG gets more attention, perhaps not as much as the environmental or E piece that focuses on gender issues
(20:36) A company that wants to start an ESG Program should first figure out who the key stakeholders are. It covers a broad set of issues that naturally implicates a lot of different stakeholders within the company.
Bryan J. Sillaman is Managing Partner of the firm’s Paris office. During his time at Hughes Hubbard, Bryan has counseled clients across a range of governance and compliance issues, including the development of policies and procedures, due diligence relating to third-parties and joint venture partners, and internal reviews and audits of their global operations. Bryan has spent significant time advising clients in connection with independent corporate monitorships and has traveled extensively in connection with his activities, including to Angola, Brazil, China, Indonesia, Malaysia, the Middle East, Nigeria, Russia, Thailand and Venezuela. 
Prior to joining Hughes Hubbard, Bryan was an attorney in the Division of Enforcement of the US Securities and Exchange Commission (SEC) where he earned a Division Director Award. 
Connect: bryan.sillaman@hugheshubbard.com
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Do you have a podcast (or do you want to)? Join the only network dedicated to compliance, risk management, and business ethics, the Compliance Podcast Network. For more information, contact Tom Fox at tfox@tfoxlaw.com.
 

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The ESG Report

Philosophy and Ethical Leadership for ESG with Joshua Nunziato


 
Tom Fox welcomes Joshua Nunziato on this episode of the ESG Report. Joshua is an author, and an Instructor in the Social Responsibility and Sustainability division of the Leeds School of Business. He joins Tom to talk about corporate leaders conducting ethical leadership, its role in ESG, and why ethical leadership is a must in the future business world.
 

 
Creating Ethical Leadership
Joshua created his Ethical Leadership course for corporate leaders to equip them with the tools and insight they need to understand the changes happening around them. “We really want to help leaders who participate in our program to understand that acceleration is really the new constant,” he tells Tom. Corporate leaders need to be able to respond proactively to changes and crises. The range of stakeholders has expanded, so the traditional approach to corporate director education is no longer going to work. Directors and corporate leaders need forward-looking tools to navigate their current environment. 
 
The Relevance of Ethical Leadership in 2022
Tom asks Joshua to explain why a course on ethical leadership is needed in 2022. Joshua responds that emerging from the crisis mode of the pandemic comes with a range of challenges that board members have to face, including increasing interest rates, high inflation and uncertainty. Board members need to be able to situate their companies against these challenges and risks, ask the right questions and provide leadership that will drive their organizations forward. 
 
The Role of Corporate Leaders in ESG
Sustainable leadership in ESG means that the needs and wants of the broad ecosystem of company stakeholders are being met with what Joshua calls, ‘compassionate pragmatism’. “Corporate leaders are able to weigh up and evaluate the comprehensive impact that their decisions are having on the environment on local communities, on their employees, on their suppliers, on their customers, and yes on their investors,” Joshua further explains. Compassionate pragmatism is also about taking in the impact, whether positive or negative, that corporate decisions may have, as well as managing what leaders can measure, and what they cannot. Leaders have to figure out what they value, and also what values they can gather as a business community that will drive them towards enduring prosperity.
 
America in Ethical Leadership
Joshua doesn’t see America taking the lead on ESG, or other sustainability issues; however he does see America leading relative to other economies that are trying to get their citizens into the global middle class. Innovation on various compliance and ethical issues is happening around the US, and this is because individuals are recognizing the need to respond. The impact of corporate decisions over the decades is being felt across the political spectrum. Scandals and breaches of ethics also have serious ramifications and consequences for businesses, and so it makes sense for leaders to step and lead with ethical conviction. Joshua’s role as a philosopher is to expand the moral imagination of the leaders he works with, so they can ask the right questions and consider sustainable leadership possibilities they otherwise may not have thought of. 
 
Resources
Joshua Nunziato | LinkedIn | Twitter 
 
 

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This Week in FCPA

Episode 290 – the Super Sunday Edition


Super Sunday is here. The NFL finally gets the game in the spotlight after weeks of brutal PR. Who ya got? “Who Dey” or Hollywood? Tom and Jay are back look at some of the week’s top compliance and ethics stories this week in the Super Sunday edition.

 Stories

1.     Do compliance professionals need a union? Dick Cassin in the FCPA Blog.
2.     Jailed employees under the FCPA. Bill Jacobsen explores in the FCPA Blog.
3.     New workplace normal for policies and training. Ingrid Freeden in Risk and Compliance Matters.
4.     New SOE risk management framework.  Alexandra Gillies and Thomas Shipley in the FCPA Blog.
5.     3 questions from KPMG and Carillion tribunal. Neil Hodge in Compliance Week. (sub req’d)
6.     SFO investigation protocol announced. Mengqi Sun in the WSJ Risk and Compliance Journal.
7.     Companies yet again ask EU for rules around ESG. Lawrence Heim in practicalESG.
8.     CCOs say self-reporting a hard sell. Evren Esen in CCI.
9.     What comes next for ABC and the Olympics? Andy Spalding in GAB.
10.  The Spotify imbroglio. Matt Kelly with a 2-parter in Radical Compliance, Part 1 and Part 2.

 Podcasts and More

11.  In February on The Compliance Life, I visit with Ellen Smith, a former Director of Trade Compliance who recently started her own consulting firm. In Part 1, she discussed her academic background and early professional career. InPart 2, Ellen moves in-house.
12.  Tom and Richard Lummis begin their annual review of Best Picturing winning movies on 12 O’Clock High, a podcast on business leadership. In Part 1 they review Schindler’s List for leadership and ethical lessons. Upcoming episodes will look at Gladiator, A Man for All Seasons and Platoon.
13.  CCI releases new e-book from Tom “FCPA 2021 Year in Review”. Available free from CCI.
14.  Trial of the Century-the Enron Trial. This week, Tom premiered a 5-part podcast series on the Enron Trial with Loren Steffy, who covered the trial for the Houston Chronicle. In Part 1, run up to the trial. In Part 2, the trial begins. In Part 3, the star witnesses and key testimony. In Part 4, the Verdict comes in. In Part 5, what did it all mean. It is be available on the Compliance Podcast Network, Megaphone, iTunes, Spotify and all other top podcast platforms.
15.  In a special 2-part series on the Sunday Book Review, Tom looks at the Notre Dame Deloitte Center for Ethical Leadership’s top books on ethical leadership from 2021. Part 1 and Part 2.
Tom Fox is the Voice of Compliance and can be reached at tfox@tfoxlaw.com. Jay Rosen is Mr. Monitor and can be reached at jrosen@affiliatedmonitors.com.

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ESG Compliance Podcast

Unfolding ESG for Private Investments with Trysha Daskam


Thoughtful evaluation – that’s what Trysha Daskam says about what sets apart Silver Regulatory Associates from other investment firms.
Thoughtful evaluation – that’s what Trysha Daskam says about what sets apart Silver Regulatory Associates from other investment firms.
With her strong foundation in compliance and regulatory expertise, Trysha unpacks the fundamentals, trends, and projections of ESG through the lens of private fund managers.
▶️ Unfolding ESG for Private Investments with Trysha Daskam.
Key points discussed in the episode:
(00:34) Trysha Daskam gives a rundown of her professional background as the managing director and head of ESG strategy in Silver Regulatory Associates.
(01:16) The three distinct services that Silver Regulatory Associates provides and the type of clients they’ve been working with since 2018.
(02:09) The unique ways Silver Regulatory Associates helps firms “shine” in the regulated space. Daskam explains how their firm evaluates managerial decisions through the lens of the investment strategy, putting themselves in their clients’ shoes.
(03:42): ESG programs must be treated with the same cautiousness and prudence as other policies. There should be an emphasis on training members to regulate and execute the program efficiently and properly.
(05:37): Having an ESG program is more than just an idea. Daskam describes how she guides investment firms into putting their strategies to fruition with the correct procedures, monitoring practices, and tools.
(07:28) Different industries are starting to realize the importance of ESG rolling out climate–centered projects and transparent DENI statistics. Financial services are pressured to come into the picture. Daskam predicts 2022 as a hallmark year for regulatory momentum among fund managers.
(09:31) The three key areas of focus for private investment managers in 2022.
(12:44) Greenwashing has become the core of regulatory movements. The U.S. Securities and Exchange Commission sees it as “a major risk in the current marketplace.” The urgent call for established standards to prevent misleading investors with deceptive language continues to intensify.
(14:31) Daskam forecasts a standardization of ESG reporting in the DENI and the FCC in 2022 as two prominent organizations have utilized diversity, equity, and inclusion questionnaires.
(15:54) Fierce competition in the investment space regarding managers putting extra effort in ESG programs and joining meaningful organizations to import outwardly on their climate impact.
(18:08) Comparable data is difficult to find in ESG market participants. But standardization progress is projected for 2022 as the International Finance Reporting Standards Board developed the International Sustainability Standards Board.
(22:38) A more sophisticated marketplace among investment firms is taking place as more players enter to take a slice of the pie.
(25:13) The investment space going into the future.
Trysha Daskam is a seasoned sustainability practitioner with an academic background unique to the industry and manages ESG strategy for investment firms, including the development and implementation of ESG policies, procedures, and internal reporting processes and conducting and overseeing ESG due diligence. Expert in policy writing and implementing regulatory controls, Trysha specializes in interpreting the impact of global regulation on a firm’s ESG program.
Connect: tdaskam@silverreg.com
 
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Do you have a podcast (or do you want to)? Join the only network dedicated to compliance, risk management, and business ethics, the Compliance Podcast Network. For more information, contact Tom Fox at tfox@tfoxlaw.com.

Categories
The ESG Report

Thoughts on Materiality

 
In ESG programs, there are many different items to be considered. In this episode, Tom Fox takes a look at one of them – materiality.  
 

 
The Materiality Debate 
The traditional view of financial materiality is that it directly impacts a company’s economic valuation. Recently, SEC commissioners have discussed it in a broader concept, encompassing data that investors deem important. Materiality, today, is whether there is a substantial likelihood that the disclosure of an admitted fact would be viewed as having significantly altered a total mix of available information. “The impact of any particular piece of information thus remains a key element of materiality,” Tom says. 
 
Information that Investors Tend to Call For 
The scope of information has expanded far beyond financial data, now including categories such as human capital, DEI, social justice, corporate governance, and climate change. Though some disagree with this development, much of the investing community does want to see a broader amount of information in materiality, going forward. It is Tom’s view that, “The time when investors could be satisfied with generalized statements certainly seems to be behind us.” 
 
Questions Companies Should Ask Themselves about Their ESG Program 
Tom checks out a post by Lawrence Heim and discusses some of the questions that are detailed, including: 

  1. Is ESG determining your company’s competitiveness? 
  2. Does driving your ESG agenda mean sacrificing your company’s return earnings?
  3. How are you navigating ESG tradeoffs? 
  4. How does ESG change due diligence?
  5. Should you become a public benefit corporation? 
  6. Should corporations address societal concerns, such as racial equity? Tom cites what happened to Activision Blizzard as an example when answering this question. 
  7. How do you develop a global approach to ESG? 
  8. How do you build an ESG framework that’s future-proof for tomorrow’s economic reality? 
  9. How do you vet a company’s performance of ESG? 
  10. How does your corporation navigate the ever-changing landscape of ESG? 

 
“As you devise metrics to track ESG, you have to be aware of current or other changes. But once again, this is what compliance officers do day in and day out,” Tom remarks. This is yet another reason Tom advocates that compliance should lead the ESG effort going forward. 
 
RESOURCES 
Tom Fox’s email
Ten Really Tough Questions Companies Should Ask Themselves About ESG
The Materiality Debate and ESG Disclosure: Investors May Have the Last Word