Tag: ESG

Categories
The ESG Report

Compliance Must Carve Out Role in Company ESG Efforts with Aaron Nicodemus

 
Aaron Nicodemus has been a reporter for over 30 years in the US and South Africa, having written for various notable publications including Bloomberg. He has been a writer/reporter at Compliance Week for the last 18 months. He is Tom Fox’s guest this week on the ESG Report. They discuss his recent article about the intersection of ESG and compliance, entitled “Compliance Must Carve Out Role in Company ESG Efforts.”
 

 
Inside the Mind of the CCO Survey
“Every year for the past three years Compliance Week has conducted an Inside the Mind of the CCO survey,” Aaron tells Tom. This year the focus was on ESG since it has been a hot topic, and they wanted to gauge what ESG initiatives looked like across industries and organizations. “Almost all of the compliance officers who took the survey felt that compliance should be involved in ESG initiatives at their company,” Aaron reveals. CCOs believe that compliance is best positioned to lead ESG since it intersects with so many of their core functions. “Putting [compliance] in charge of the ESG initiatives would help make sure that [the company] meets all the regulations that they should, and also that they are reporting on data that is both accurate and informative,” he comments. Now that the SEC is poised to issue new mandates regarding climate change disclosures, compliance will most likely have to be front and center for ESG going forward. “When regulators get involved that tends to push compliance to the fore,” Aaron remarks.
 
Key Findings
Tom and Aaron discuss some key findings outlined in the article. These include:

  • The actual role of CCOs in ESG – 73% of CCOs have an active role in ESG, either as advisor, primary overseer, or advocate. 
  • Where they see their role – 23% of CCOs feel they should have more oversight over ESG than they currently have. Most persons surveyed feel that compliance should have a prominent role in ESG.
  • Whether compliance should lead all 3 aspects of ESG – Most CCOs see governance as their core function, while environmental and social concerns are secondary roles. 
  • Compliance is the conscience of the company.
  • Stakeholders are demanding more information on ESG to influence their investment decisions.

 
Growth of ESG
Tom sees ESG as the fastest moving corporate initiative. He asks Aaron if the survey confirms this view. “It’s been a gradual process that has come to a head in Europe and in the UK,” Aaron responds. Similar climate change disclosure mandates are likely to happen in the US in 2022. Companies have been pursuing sustainability and D&I initiatives for several years. “ESG collects up some of those things in a tight little bundle, and you can really pursue a lot of issues under the ESG umbrella,” he continues. He sees ESG accelerating over the next few years, starting with climate change. 
 
Resources
Aaron Nicodemus on LinkedIn | Twitter | Email
Compliance Week: Compliance Must Carve Out Role in Company ESG Efforts
 

Categories
This Week in FCPA

Episode 280 – the Happy Holiday edition

Hannukah came early this year and we are now in the full holiday swing of things. Tom and Jay are back to look at some of the week’s top compliance and ethics stories this week in the Happy Holidays edition. 

Stories

1.     New Biden Administration anti-corruption strategy revealed. Matt Kelly in Radical Compliance.
2.     Mike Volkov asks where are the FCPA enforcement actions? In Corruption Crime and Compliance.
3.     Global ESG efforts and compliance. Mike Munro in explores in the FCPA Blog.
4.     More on the OECD recommendations.  Jessica Tillipman in the FCPA Blog.
5.     DOL proposal may change ESG game. Melissa Khan in Harvard Law School Forum on Corporate Governance.
6.     Nurturing ethical culture. Matt Kelly in Risk and Compliance Matters.
7.     Is Italy a safe haven for bribe payors? Rick Messick asks in GAB.
8.     How to avoid a dystopian office culture. Rob Shavell in CCI.
9.     Top ethics and compliance failures in 2021. Jaclyn Jaeger in Compliance Week (sub req’d).
10.  When is a potential fine a threat? Keith Paul Bishop in California Corporate and Securities Law.   

Podcasts and Events

11.  The recent announcement by DAG Monaco on the refocus of the DOJ’s use of monitors has caused much consternation. To analyze, Affiliated Monitors sponsored a 5-part podcast series this week Not Your Father’s Monitor. In this Episode 1, Bethany Hengsbach considers this change in monitorships from the white-collar enforcement and defense perspective. In Episode 2, Mikhail Reider Gordon looks at global aspects of the new DOJ monitor’s focus. In Episode 3, Cristina Revelo discusses how E&C assessments help drive more compliant companies. In Episode 4, Jesse Caplan brings his views on the intersection of the twin topics of antitrust and healthcare compliance. In Episode 5, Vin DiCianni looks at where monitors and monitorships are going in 2022 and beyond.
12.  Are you exasperated? Then check, F*ing Argentina. In this podcast series co-hosts Tom Fox and Gregg Greenberg, author of F*ing Argentina explore the current American psyche of being overworked, over leveraged, overtired and overwhelmed. Find out about modern America’s exasperation with well…exasperation. In our final episode, we wrap up what we learned from the series.
13.  In November on The Compliance Life, I visit with Matt Silverman, Director of Trade Compliance at VIAVI. Matt is the first Trade Compliance Director I have hosted on TCL. In Part 1, Matt details his academic career and early professional life.
14.  The Compliance Podcast Network welcomes Professor Karen Woody and her new podcast, Once Upon a Trading Law: The History of Insider Trading. In this most unique pod, Karen interviews some of her student to tell the history of insider trading. Check out Episode 1, which looks at the beginnings of insider trading.
15.  Join Tom, Mike Volkov, Carrie Penman, Dr. Pat Harned and Skip Lowney (an all-star panel if there ever was one) for the ECI webinar on the intersection of compliance and E&C programs. Wednesday, December 15, from 2-3:30 ET. Registration and information here.
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.

Categories
From the Editor's Desk

November in Compliance Week

Welcome to From the Editor’s Desk, a podcast where co-hosts Tom Fox and Dave Lefort, Editor in Chief at Compliance Week unpack some of the top stories which have appeared in Compliance Week over the past month, look at top compliance stories, talk some sports and generally try to solve the world’s problems.

 In this month’s episode, we look back at top stories in CW from November including the final results from the CW survey ‘Inside the Mind of the CCO’. It includes a discussion of the gender gap in pay for compliance professionals, the role of compliance in ESG and the role of compliance in fighting cyber breaches. We discuss the Compliance Week 2022 Conference scheduled for May in DC and upcoming CW event on best practices to prevent a ransomware attack. We conclude with a look at some of the top sports stories including the MLB lock out by management, Michigan beating Ohio State and the storyline of a potential Brady v. Belichick Super Bowl.

Check out the CW articles on Inside the Mind of the CCO, here, here and here.

Early register for CW 2022 Conference here.

Categories
This Week in FCPA

Episode 279 – the Happy Hanukkah Edition

Hanukkah comes early this year. As the Rosen household begins its annual celebration, Tom and Jay are back to look at some of the week’s top compliance and ethics stories this week in the Happy Hanukkah edition. 

Stories

1.     Preparing for dawn raid in the era of hybrid work? Andrew Reeves and Annie Birch in FCPA Blog.
2.     When you fight corruption, it fights back. Rick Messick in GAB.
3.     Why does Walmart want to keep an exec quiet about its compliance program? Dick Cassin explores in the FCPA Blog.
4.     Board effectiveness survey.  Paul DiNicola and Leah Malone in the Harvard Law School Forum on Corporate Governance.
5.     New OECD ABC suggestions. Nicola Bonucci and Nat Edmonds in the FCPA Blog.
6.     Graybeards and Youngbloods working together. Carrie Root in CCI.
7.     Trust in companies ‘shockingly’ low? Lawrence Heim in PracticalESG.
8.     Are senior level compliance positions becoming harder to find and fill? Matt Kelly explores in Radical Compliance.
9.     Role of PwC in Tesla/JPMorgan dispute. Francine McKenna explores in The Dig (sub req’d).
10.  How will tech change the work landscape in 2022? Check out this pod with Mrs. Monitor (AKA Rebecca Rosen) on Freshbrewed Tech. 

Podcasts and Events

11.  How can you show ROI from your internal investment in compliance? Nick and Gio Gallo join Tom Fox in the most unusual pod series, Mining the Gold in Compliance. Part 1 – ROI on Compliance. Purchase Decisions. Part 2 – Extending Compliance Value Across an Organization. Part 3 – Compliance and ESG Investments. Part 4 – Finance and Investing Models for Compliance. Part 5 – Investment Strategies for the Compliance Professional.
12.  Are you exasperated? Then check, F*ing Argentina. In this podcast series co-hosts Tom Fox and Gregg Greenberg, author of F*ing Argentina explore the current American psyche of being overworked, over leveraged, overtired and overwhelmed. Find out about modern America’s exasperation with well…exasperation. In Episode 11, a birthday party battle through text messages.
13.  In November on The Compliance Life, I visited with Wendy Badger, CCO at Tennant. In Part 1, she detailed her academic career and early professional life. In Part 2, changing ladders to advance your career. In Part 3, Wendy moved into the CCO Chair. In Part 4, Wendy talked about having courage in your career choices and compliance into the future. Next week, we begin the December series with Matt Silverman, Director of Trade Compliance at VIAVI.
14.  The Compliance Podcast Network welcomes Professor Karen Woody and her new podcast, Once Upon a Trading Law: The History of Insider Trading. In this most unique pod, Karen interviews some of her student to tell the history of insider trading. Check out Episode 1, which looks at the beginnings of insider trading.
15.  Join Tom, Mike Volkov, Carrie Penman, Dr. Pat Harned and Skip Lowney (an all-star panel if there ever was one) for the ECI webinar on the intersection of compliance and E&C programs. Wednesday, December 15, from 2-3:30 ET. Registration and information here.
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.

Categories
Innovation in Compliance

Gold in the Compliance Hills: Part 3, Compliance and ESG Investments


Welcome to a special five-part podcast series on how to unlock the gold in your program, hosted by Tom Fox with guests Gio and Nick Gallo from ComplianceLine. One of the ongoing issues in compliance is to demonstrate the Return on Investment (ROI) in your compliance program. One way to do so is by demonstrating the extended value of compliance literally across your entire company. When overlaid with an ESG component, you can begin to see the gold in your compliance hills. In addition to showing how you can unlock the gold in your own compliance hills, Gio and Nick walk you through how demonstrate ROI for your internal budgeting process which can provide to you the financial resource to strengthen and improve your compliance program.
Join us for the full 5 episodes and learn to see your compliance program in an entirely new light. In this Part 3, we consider how a CFO and finance department might see ESG investments differently than a CCO and compliance professional.
Some of the highlights of this episode include:

  • A CFO and finance function will more likely see ESG in relations to capital markets, bank financing, index funds and even insurance costs.
  • How can a CCO speak this language about not only the compliance program but in leading the company’s ESG efforts?
  • How to package your data, documentation and reports regarding ESG to appeal to a CFO.
  • Seek input on what investors are looking from your ESG program.

Resources
Gio Gallo on LinkedIn
Nick Gallo on LinkedIn
ComplianceLine

Categories
Blog

Mining the Gold in the Compliance Hills: Part 3 – Compliance and ESG Investments

Welcome to a special five-part blog post series on how to unlock the gold in your program. I visit with Gio Gallo and Nick Gallo, Co-CEO’s of ComplianceLine, LLC, the sponsor of this series.
One of the ongoing issues in compliance is to demonstrate the Return on Investment (ROI) in your compliance program. One way to do so is by demonstrating the extended value of compliance literally across your entire company. When overlaid with an ESG component, you can begin to see the gold in your compliance hills. In addition to showing how you can unlock the gold in your own compliance hills, Gio and Nick discussed demonstrating ROI for your internal budgeting process which can provide to you the financial resource to strengthen and improve your compliance program. Today, in Part 3, we look at the role of the Chief Compliance Officer (CCO) and corporate compliance function in ESG investments.
We began with the basic question of why a Chief Financial Officer (CFO), or corporate finance function look at ESG investment and how it will be different than a CCO or compliance function would do so. Gio noted that finance will most probably be “considering the outcome and it is something else for me to figure out.” Yet they may well also see it as a new opportunity and a “new conversation that we can be a part of. We may be able to get to that head of the pack because through some early investments which might be in programs or just how we talk about it.” The impact is that finance types might see more opportunities in this than the E&C professional, which you should be conscious of as you enter this conversation. Gio stated, “if we can make something out of this zeitgeist it might be seen as a unique opportunity.”
Conversely, he also noted “there’s no F in the ESG, right? This means the finance lens for this opportunity might be to get better financing for the company.” This might present a funding opportunity, either through a loan, additional capital or other funding mechanisms. It might also work to lower the cost of capital because investors might see your company is really an attractive company. That is what ESG might end up meaning from the finance perspective. The beauty of this is that the approach is equally valid to a compliance-focused approach and demonstrates there are multiple reasons for implementing an ESG program.
Nick emphasized the opportunity that ESG presents. Not simply for each commercial organization but for the compliance function as well. He stated, “irrespective of whether or not your organization is serious about it, you need to take advantage of the opportunity and the window of opportunity that we have right now, because compliance speaks to every single one of those pillars in the ESG acronym.”
From the compliance perspective, there are several reasons for this. It is top of mind for investors and in mind of the marketplace. He said, “Use what you have in place already to show your organization is committed to ESG. Moreover, you probably already have 80% of this stuff done. We already have a speak-up line. We already have a training for our business ethics and corporate culture.” The bottom line is “there are probably a bunch of ESG type things that you are doing.” You can build on all of them. It is a massive opportunity. Do some research on what is publicly available on ESG reports, “grab a handful of those and start looking at what some of your competitors or what other folks in the marketplace are putting into their report. I guarantee there’s a massive overlap with some of the data points that already exist in your organization.” As a compliance professional “it’s about shifting your mindset and using this opportunistically, to take advantage of the amorphousness that is ESG right now.” Nick even compared ESG in 2021 to where compliance was in the mid-1990s after the release of the US Federal Sentencing Guidelines and the creation of the modern compliance professional. It took some 15 to 20 years for corporations to understand that compliance was a business differentiator and business positive and not simply a legal response to a long-standing law, such as the Foreign Corrupt Practices Act (FCPA). In the age of social media, the speed of the change in ESG will be much quicker. Simply witness the change from the Trump Administration which actively fought corporate ESG initiatives to that under the Biden Administration which has fully embraced ESG from a regulatory perspective.
We concluded by considering many of the tasks that a CCO and compliance professional are already doing. Nick provided the following examples, “You can pull that out of your case management system and look at some of the following issues: How many discrimination and harassment claims did you have last year? How many did you have this year? What were the turnaround time on those? How many days did it take you to close those? What can you take credit for? That’s really what ESG is kind of about.” The same is true for your basic risk management strategies involving your third parties and other business ventures.
It is a function of getting an understanding of who your audience is. From the compliance perspective do not simply focus on an audience of one, the government. Look at in the way the Business Roundtable did with their Statement on the Purpose of an Organization. There are multiple stakeholders that you can engage with and work with to satisfy their ESG concerns.
Check out the full podcast series this blog post series is based upon.
Episode 1
Episode 2
Episode 3
 

Categories
The ESG Report

Implementing ESG Programs


 
Tom Fox speaks on important issues to note in designing and implementing ESG programs. He shares an overview on the structure of ESG programs and explains why they should be led by compliance.
 

 
ESG Internal Controls
ESG programs must be tailored to fit your company’s risk profile, Tom explains. Companies must be able to identify, measure, and address all risks within ESG. “The ‘E’ is going to be more focused on climate and the environment, but this means understanding your company’s environmental footprint and your risks.” Rather than assigning this to the audit committee, Tom recommends ethics and compliance, as they have a similar responsibility and similar processes. “This tends to show how compliance lends itself to either leading or being a significant part of an overall ESG corporate response,” he adds. From an operational perspective, it makes more sense to then report directly to the board after these operations are put together.
 
Measuring ESG
ESG operations consist of a cross section of corporate operations, environmental concerns, and social issues. Companies must identify issues falling under the ESG umbrella, tailor an ESG program, and select key measures of performance. “ESG disclosures open up an entire new set of standards, controls, and requirements around setting proper disclosure of ESG relevant information and performance,” Tom tells listeners. DEI is just one; climate change and environmental issues will raise another set of requirements. Companies will have to determine what information shareholders, stakeholders, investors, and others will focus on for the ESG evaluation process.
 
ESG and Compliance
Both ESG and compliance programs involve risk assessments, policies and procedures, and controls to mitigate risk, to name a few similarities. Tom advocates that compliance is uniquely suited to lead a corporate ESG effort, as this new world “shares many operational principles with an overall ethics and compliance program.” Issue programs must be designed around five basic operational issues:

  1. Information collection,
  2. Accuracy and reliability of information,
  3. Data collection procedures,
  4. Coordination with the disclosure procedures, and
  5. Testing, auditing, and monitoring the process to ensure accuracy and effective operation.

 
Resources
Tom Fox’s email
 
Implementing ESG Programs: Structure and Responsibilities (Part I of III) – Corruption, Crime & Compliance
 
Building an ESG Structure and Program (Part II of III) – Corruption, Crime & Compliance
 
Basic Operational ESG Program Issues (Part III of III) – Corruption, Crime & Compliance
 

Categories
This Week in FCPA

Episode 278 – the Happiest Profession edition


Is compliance the happiest profession? Are you passionate about compliance? If you are either or both, you are not alone. Guest Host Karen Woody and Tom Fox look at these and other stories this week in the Happiest Profession edition.
Stories

  1. Is Compliance the happiest profession? Amii Bernard-Bahn explores in Compliance Week (Sub Req’d)
  2. Report on SEC Enforcement Activity: Public Companies and Subsidiaries for 2021. Tom Gorman in SEC Actions.
  3. Supply chain and compliance. Mike Volkov in Corruption Crime and Compliance. Dick Cassin in the FCPA Blog.
  4. What does ESG mean for the SEC? Commissioner Crenshaw remarks to the Pepsico-PWE Conference in the Harvard Law School Forum on Corporate Governance.
  5. Corruption as psychic revenge. Richard Bistrong in the FCPA Blog.
  6. Mitigating cyber risks. Debevoise Plimpton lawyers in Compliance and Enforcement.
  7. COP26 wrap up. What are the lessons for compliance? Lawrence Heim in PracticalESG.
  8. SEC broke all whistleblower awards in FY 2021. Aaron Nicodemus in Compliance Week (Sub Req’d) Carrie Penman says it’s a wakeup call for companies in Ethics and Compliance Matters.
  9. Diversity at the top. Jim Deloach in CCI.
  10. How did Classical Athenians define corruption? Kellam Conover in GAB.

Podcasts and Events

  1. Have you or a loved one been impacted by Lyme Disease? This week I have run a 5-part series on this most misunderstood malady with Dr. Ben Locwin and Scott Endicott. In Part 1 we looked at Origins. In Part 2 we considered the Diagnosis Dilemma. In Part 3 we reviewed Treatment and Innovation. In Part 4, we discussed Prevention and Immunity. In Part 5, we looked ahead for where this disease detection, prevention and treatment might be heading.
  2. Are you exasperated? Then check, F*ing Argentina. In this podcast series co-hosts Tom Fox and Gregg Greenberg, author of F*ing Argentina explore the current American psyche of being overworked, over leveraged, overtired and overwhelmed. Find out about modern America’s exasperation with well…exasperation. In Episode 10, a trip on the New Jersey Turnpike.
  3. This month on The Compliance Life, I visit with Wendy Badger, CCO at Tennant. In Part 1, she details her academic career and early professional life. In Part 2, changing ladders to advance your career. In Part 3, Wendy moves into the CCO Chair.
  4. How does a Compliance Bible become a best-seller? Check out Tom’s appearance on the C-Suite Network’s Best Seller TV to find out. Purchase The Compliance Handbook, 2nd edition here.

Tom Fox is the Voice of Compliance and can be reached at tfox@tfoxlaw.com. Karen Woody is Associate Professor at Washington and Lee University School of Law and can be reached at kwoody@wlu.edu.

Categories
Great Women in Compliance

Michele Abraham on What Makes Up ESG


Welcome to the Great Women in Compliance Podcast, co-hosted by Lisa Fine and Mary Shirley.
ESG, CSR, Sustainability…it seems like the thing that everyone is talking about lately.  In today’s Great Women in Compliance podcast, Lisa speaks with Michele Abraham, Senior Director – Ethics & Compliance, Associate General Counsel at Cooper Standard.  Michele is a leader in this area and has worked to integrate ethics and compliance and ESG.
She talks about what she thinks that compliance officers must to when they are starting to develop an ESG program, and also how the “E” of ESG – “environmental” is often more operational, but the “S” and “G” – Social and Governance – is at the forefront of what E&C professionals are doing today.
Michele is an advocate for Gretchen Ruben’s “The Four Tendencies,” which discusses four personality types and how to work with them.  There is a quiz, so she is asked to guess Lisa’s tendency.
And she concludes with some of the best advice she received…from her mom.
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).
If you’ve already read the booked and liked it, will you help out other women to make the decision to leverage off the tips and advice given by rating the book and giving it a glowing review on Amazon?
As always, we are so grateful for all of your support and if you have any feedback or suggestions for our line up or would just like to reach out and say hello, we always welcome hearing from our listeners.
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.

Categories
Coffee and Regs

CCOs & ESG – Preparing Now for What’s Next

CCOs & ESG – Preparing Now for What’s Next

In this episode, CSS’s team of CCOs Matt Calabro and Victoria Olson discuss how CCOs can prepare now for what’s to come with ESG – from policies and procedures to marketing materials and disclosures.
 

About Our Guest Speakers:


Matt Calabro is an experienced Chief Compliance Officer, having served as CCO for registered mutual funds, investment advisers and a family of UCITS funds. Before joining CSS, Matt was Deputy CCO at Delaware Investments, where he led the daily activities of the firm’s compliance department covering advisory, fund and distribution activity. Under his leadership, Delaware implemented specific improvements in its guideline compliance, advertising review and Code of Ethics programs. Prior to Delaware, Matt spent 20 years in Raymond James’ investment advisory business, where he led mutual fund operations. While there, Matt implemented and upgraded controls, processes and technology and also served as the first full-time CCO to the mutual funds following the adoption of the Compliance Rule. Matt leverages his compliance and operations experience in the investment management industry to assist advisers and investment companies in advancing the effectiveness of their compliance programs.
 

Victoria Olson has been a compliance consultant for several years, most recently with Alaric Compliance Services. She is a Certified Regulatory and Compliance Professional (CRCP issued by FINRA Institute at Wharton), and a Chartered Life Underwriter. She also completed the Certified Anti-Money Laundering specialist (CAMS) course. Victoria previously served as the Chief Compliance Officer to an SEC-registered investment adviser and has extensive experiencing working with RIAs. Prior to consulting, Victoria was Chief Compliance Officer and AML Compliance Officer at Forethought Financial, Director of Compliance at Prudential Financial, and a Senior Compliance Officer at The Phoenix Companies. Victoria formerly served as Chair of the FINRA District 11 Committee and successfully completed the FINRA Series 4, 6, 7, 24 and 66 Examinations.