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Popcorn and Compliance

Popcorn and Compliance – All Quiet on the Western Front: Lessons on Business Resilience in Risk Management

Tom Fox and Richard Lummis are back with a new season of Popcorn and Compliance. Get ready for a ton of fun, insights, and all things Hollywood and the movies. In this episode, Tom and Richard dive into some Oscar-winning Best Pictures for Compliance and Leadership Lessons. Today, they consider the 1930 Oscar-winning Best Picture, All Quiet on the Western Front.

Leadership in extreme situations is a crucial skill, applicable not only on the battlefield but also in high-stakes corporate environments such as supply chain management and compliance. Tom emphasizes the importance of adaptability and resilience. He believes that having a structured approach to managing evolving risks is vital, much like soldiers navigating unpredictable battle conditions. Richard echoes this sentiment, highlighting how extreme emotions and behaviors in war necessitate extreme leadership responses, often revealing a disconnect between officers and frontline soldiers. Both perspectives underscore that effective leadership in such challenging scenarios requires decisiveness, emotional intelligence, and the ability to empower others, reinforcing the timeless nature of these leadership qualities.

Key highlights:

  • Adaptability and Resilience in Extreme Leadership
  • Adaptability Frameworks: Business Resilience in Risk Management
  • Executing Decisions with Imperfect Information
  • Leadership Insights from 1927 War Story

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Compliance Tip of the Day

Compliance Tip of the Day – Engaging Compliance Leadership

Welcome to “Compliance Tip of the Day,” the podcast where we bring you daily insights and practical advice on navigating the ever-evolving landscape of compliance and regulatory requirements. Whether you’re a seasoned compliance professional or just starting your journey, we aim to provide bite-sized, actionable tips to help you stay on top of your compliance game. Join us as we explore the latest industry trends, share best practices, and demystify complex compliance issues to keep your organization on the right side of the law. Tune in daily for your dose of compliance wisdom, and let’s make compliance a little less daunting, one tip at a time.

Today, we consider how compliance can engage employees through collaborative leadership to create more robust compliance programs.

For more information on the Ethico Toolkit for Middle Managers, available at no charge, click here.

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Blog

Upping Your Compliance Game, Part 3 – Engaging Leadership

We continue exploring what the Trump Administration’s suspension of FCPA enforcement means for the compliance professional. Hui Chen has suggested that this is an opportunity for compliance, but to do so, “It’s time to up your game . . . Instead of selling insurance for FCPA enforcement, become leaders that help your organizations perform.” Based upon this prompting from her, I am writing this week on issues that compliance professionals can use to ‘up their [compliance] game so that when the questions come from your senior executives or Board of Directors come down about your compliance program, you will be able to point to clear business advantages to doing business ethically and in compliance.

Today, we consider how a chief compliance officer (CCO) or compliance professional can personally up their leadership game and move their compliance program to a more collaborative and integrated business function. The shift is driven by changes in corporate power dynamics, new values that prioritize transparency and collaboration, and an increasing emphasis on engagement with business units. In their Harvard Business Review article, Understanding “New Power,” Jeremy Heimans and Henry Timms explore how leadership models change. I have adapted their insights for Chief Compliance Officers (CCOs) and compliance practitioners who seek to enhance their function’s role within an organization.

The Shift from Old Power to New Power

Heimans and Timms describe the transition from “old power” to “new power” as a shift in the models used to exercise power and the values organizations embrace. Traditional compliance programs often operated under old power models, centralized, top-down structures that relied on authority and rigid governance. In contrast, new power models emphasize distributed, collaborative, and participatory leadership.

  1. Sharing and Shaping. In this new era under Trump, companies increasingly engage stakeholders, including employees and supply chain partners, in shaping compliance strategies. This shift recognizes that compliance is not just about adherence to regulations but about embedding ethical considerations into everyday decision-making. Companies that actively solicit input from their workforce and external partners create stronger, more effective compliance cultures.
  2. Organizations are using creative financial structures to embed compliance into business operations rather than treating it as a standalone cost center. Instead of viewing compliance as an overhead expense, forward-thinking businesses integrate compliance into investment decisions, allocate resources for proactive risk management, and leverage compliance to drive operational efficiencies and innovation.
  3. Employees and third-party stakeholders actively contribute to compliance initiatives rather than passively following directives. This participatory approach ensures that compliance is not merely a function of the legal or risk department but is embraced across the organization. Companies encourage employees to report issues, contribute to compliance improvements, and take ownership of ethical behavior.
  4. Co-Ownership. Compliance is decentralized, empowering employees at all levels to take ownership of ethical behavior. When employees and third parties feel personally responsible for compliance, adherence to ethical standards becomes more organic. Businesses that create opportunities for co-ownership in compliance initiatives through peer-led training, employee-driven reporting mechanisms, and cross-functional ethics committees build a more resilient ethical culture.

This shift makes compliance less about enforcing rules and more about embedding ethical business practices into the corporate culture. Organizations that embrace new power structures are better positioned to handle complex regulatory environments, foster innovation, and build trust among employees, customers, and stakeholders.

New Compliance Values: A Guide for Leadership

Beyond structural changes, Heimans and Timms identify new values that organizations must embrace to remain effective. These values directly apply to compliance professionals, who must ensure compliance is embedded within the organization’s broader culture and governance structures.

  • Decision-making is becoming more informal and network-driven, requiring compliance professionals to work across functions. Instead of a strict top-down enforcement model, modern compliance programs emphasize collaboration across departments, ensuring compliance is seamlessly integrated into everyday business activities.
  • Compliance programs must reward those who share best practices and improve existing compliance structures. Organizations that foster a collaborative compliance culture encourage employees to speak up about risks, participate in ethics initiatives, and help improve compliance processes.
  • Do It Ourselves (DIO). Employees expect to participate in ethical decision-making rather than be dictated to by top leadership. Empowering employees to take initiative in compliance—whether through peer-led training, ethics committees, or compliance ambassadors—creates a more engaged workforce and a stronger culture of accountability.
  • Organizations must foster open communication about compliance issues, internally and externally. A transparent compliance program builds trust with employees, investors, and customers. Companies that proactively disclose compliance efforts, encourage whistleblowing, and provide clear guidelines for ethical decision-making strengthen their credibility and resilience.
  • Younger employees are less likely to maintain long-term relationships with institutions, making an agile and adaptive compliance function essential. Compliance teams must develop dynamic and engaging strategies to connect with employees, including leveraging technology, social media, and innovative training programs to maintain engagement and adherence to ethical standards.

To succeed in this environment, compliance leaders must embrace these principles and adapt their approach accordingly. Compliance functions prioritized engagement, empowerment, and innovation will be better equipped to navigate the complexities of modern business environments.

Three Steps for Engaging Compliance Leadership

To fully integrate compliance into business strategy, CCOs and compliance practitioners should consider three key actions:

1. Assess Your Role in a Changing Power Environment

A compliance risk assessment has traditionally focused on external threats, but today’s CCOs must also assess their function internally. Where does your compliance program stand on the power spectrum, and where do you want it to be in five years?

  • Conduct an internal assessment to evaluate how compliance is perceived across departments.
  • Benchmark against industry leaders and best practices to identify areas for growth.
  • Engage in strategic conversations with executives and employees to understand their compliance expectations and challenges.
  • Develop a vision for the future of compliance in the organization, ensuring alignment with business objectives.

Organizations can proactively identify gaps and opportunities to enhance their compliance function by assessing compliance through a broader lens.

2. Incorporate Business Unit Interests (The UX)

To be effective, compliance should not operate in a silo or, as Carsten Tams continually reminds us, “It’s all about the UX.” Business units should have a voice in shaping compliance policies. This means:

  • Conduct honest conversations with employees and leadership about compliance’s impact on business operations.
  • Soliciting feedback from business units before imposing compliance requirements.
  • Recognizing compliance as a business enabler, not just a risk mitigation function.
  • Encouraging cross-departmental collaboration on compliance initiatives.

As Heimans and Timms note, introspection and engagement must precede any investment in compliance initiatives. Organizations that fail to engage business units in compliance discussions risk resistance, non-compliance, and inefficiencies.

3. Mobilize Compliance Capacity Across the Organization

Compliance leaders must proactively engage third parties and business ventures, such as joint ventures and supply chain partners, to extend compliance influence beyond internal teams.

  • Establish compliance training programs tailored to third-party vendors and supply chain partners.
  • Implement robust third-party due diligence processes to ensure compliance throughout the supply chain.
  • Develop reporting mechanisms that allow external partners to flag compliance concerns.
  • Build alliances with industry groups and regulators to stay ahead of evolving compliance trends.

For example, compliance expert Mary Jones, former Director of Compliance at Global Industries Ltd., emphasized the importance of training third parties. She traveled to supplier locations to conduct in-person compliance training, fostering stronger relationships and enhancing compliance effectiveness. This proactive approach strengthened Global Industries’ compliance function and positioned their suppliers as allies in the compliance journey.

A successful compliance function does more than enforce rules; it builds a network of ethical partners who actively support compliance objectives.

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12 O’Clock High-a podcast on business leadership

12 O’Clock High, a podcast on business leadership – Leadership Insights from ‘All Quiet on the Western Front’

12 O’Clock High, an award-winning podcast on business leadership, brings together stories from history, the arts, sports and movies, research, and current events to consider leadership lessons. Tom and Richard Lummis return with their fan-favorite series on leadership lessons from Oscar-winning Best Picture movies. Today, we look at leadership lessons from ‘All Quiet on the Western Front.’

Their discussion centers on the graphic depictions of war and how they provide insights into extreme leadership, adaptability, and the disconnect between officers and soldiers. They explore the themes of teamwork and human resilience demonstrated by the characters, especially in challenging situations. A poignant exploration of emotional intelligence and empathy in high-stress environments is also examined, relating these themes to the business world and modern leadership challenges. Join Richard and Tom as they reflect on how these lessons from a nearly century-old text are still relevant today in navigating uncertainty and building resilient frameworks in corporate compliance.

Key highlights:

  • Overview of ‘All Quiet on the Western Front’
  • Themes of War and Leadership
  • Modern Reflections on Military Lessons
  • Emotional Intelligence and Empathy in War
  • Resilience and Decision Making
  • The Role of Data in Leadership

Resources:

All Quiet on the Western Front and Everyday Leadership

Employer Branding Lessons from All Quiet on the Western Front

All Quiet on the Western Front

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Presidential Leadership Lessons for the Business Executive

Presidential Leadership Series – Herbert Hoover’s Rise, Part 1: From Poverty to the Presidency

Who are our greatest Presidents? What lessons can the modern-day business leader learn from our 47 Chiefs of State? Welcome to a new season of this award-winning podcast series with Tom Fox and Richard Lummis to delve into the great and not-so-great Presidents to mine their successes and failures for today’s business executives. In this episode, Tom Fox and Richard Lummis begin a two-part series on the life and times of Herbert Hoover. In Part 1, we look at Hoover’s beginnings and the time up to his presidential election 1928.

We begin with Hoover’s humble beginnings, rise as the first president born west of the Mississippi, and extensive international business and humanitarian efforts. Key questions include the significance of a pre-presidential resume and how one determines the qualifications for leadership without prior experience. Highlights include Hoover’s tenure during World War I, his visionary work in the U.S. Food Administration, and significant contributions to infrastructure projects like the Colorado River Compact and the Hoover Dam. This episode also touches on Hoover’s progressive policies despite being overwhelmed by the Great Depression during his presidency.

Key highlights:

  • Early Life and Education
  • Hoover’s Business Career
  • Humanitarian Efforts During WWI
  • Political Career and Secretary of Commerce
  • Conclusion and Final Reflections

Resources-Herbert Hoover

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SBR - Authors' Podcast

SBR – Author’s Podcast – Exploring the Future of Work, Ethics, and Compliance with Kelly Monahan, Part 2

Welcome to the Sunday Book Review, The Authors Podcast! Host Tom Fox visits with authors in the compliance arena and beyond in this Podcast Series. Today, Tom is joined by his good friend and colleague, Earnie Broughton (Earnie from Boerne), to visit with Dr. Kelly Monahan, co-author of the soon-to-be-released book Essential: How Distributed Teams, Generative AI, and Global Shifts are Creating a New Human-Powered Leader.  (Co-authored with Dr. Christie Smith) We three had such good fun that we went on for nearly an hour, so we have broken up the interview into two podcasts. If you have not checked out our first episode, you can do so by clicking here.

In Part 2, we deeply dive into effective communication tools for conveying corporate values to diverse workplace groups, emphasizing tailored training and gamification. Kelly highlights the importance of engaging, behavior-reinforcing communications through storytelling and public recognition systems. Emphasizing intrinsic motivation over financial incentives, Kelly draws on behavioral economics and the importance of fostering an environment of curiosity and context awareness for leadership roles. The discussion also addresses the nuances of generational differences in the workforce and the importance of diversity, equity, inclusion (DEI), and ESG initiatives for long-term organizational sustainability. Compliance professionals are encouraged to stay ahead of AI developments and promote positive behaviors to align with evolving business and ethical standards.

Key highlights:

  • Effective Communication Tools for Corporate Values
  • Future of Leadership in the Age of AI
  • Suspending Self-Interest and Cultivating Curiosity
  • Importance of Context in Ethical Decision-Making
  • Generational Differences in the Workforce
  • Role of Ethics and Compliance Professionals

Resources:

The Essential Website

Pre-Order Essential: How Distributed Teams, Generative AI, and Global Shifts are Creating a New Human-Powered Leader on Amazon.com

Kelly Monahan on LinkedIn

Earnie Boughton On LinkedIn

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31 Days to More Effective Compliance Programs

31 Days to a More Effective Compliance Program: Day 10 – Leadership’s Role in Shaping Corporate Culture and Compliance

Welcome to a special podcast series on the Compliance Podcast Network, 31 Days to a More Effective Compliance Program. Over these 31 days of the series in January 2025, Tom Fox will post a key part of a best practices compliance program daily. By the end of January, you will have enough information to create, design, or enhance a compliance program. Each podcast will be short, at 6-8 minutes, and will include three key takeaways you can implement at little or no cost to help update your compliance program. I hope you will join us each day in January for this exploration of best practices in compliance.

In today’s episode, we dive into the critical role of senior management in fostering a strong corporate culture of compliance, as highlighted by the 2022 Monaco Memo and the 2020 FCPA Resource Guide, 2nd edition. Emphasizing that corporate culture is vital to a company’s success, we discuss how the DOJ assesses ethical cultures and the importance of senior management’s active participation in compliance efforts. The episode outlines five key factors to guide senior leadership in setting, modeling, and monitoring the right tone at the top. These include clear communication of values, personal commitment to those values, supportive systems, integration into decision-making, and empowering managers to make ethically sound decisions. We conclude with three takeaways: senior management must engage in compliance, the DOJ evaluates corporate culture during investigations, and CEOs should be seen as chief compliance ambassadors.

Key highlights:

  • The Importance of Corporate Culture
  • DOJ’s Expectations for Senior Management
  • Five Factors for Effective Leadership

Resources:

Listeners to this podcast can receive a 20% discount on The Compliance Handbook, 5th edition, by clicking here.

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Innovation in Compliance

Innovation in Compliance – Navigating Leadership and Talent Retention with Pat McNeil

Innovation comes in many areas, and compliance professionals must be ready for and embrace it. Join Tom Fox, the Voice of Compliance, as he visits with top innovative minds, thinkers, and creators in the award-winning Innovation in Compliance podcast. In this episode, host Tom Fox visits Pat McNeil, founder and principal of Chart House Solutions, to delve into his extensive experience in the Navy and his journey into leadership development and organizational coaching.

Pat discusses his transition from the military to civilian life, the creation of Chart House Solutions, and his role in guiding clients through professional and personal challenges. He introduces the EC3 principle for talent retention—expectations, communication, commitment, and consistency, drawing parallels from his military service to corporate environments. He also highlights the importance of structured training and the concept of ‘falling forward’ in professional development. He discusses the Lego Serious Play method, emphasizing the role of serious play in improving corporate settings and engagement. Pat stresses that coaching at all organizational levels fosters effective leadership and a sustainable company culture.

Key highlights:

  • Pat McNeil’s Professional Background
  • The EC3 Principle for Talent Retention
  • Lego Serious Play Method in Corporate Training
  • Falling Forward: Embracing Failure in Professional Development
  • Training with Purpose: Driving Culture and Engagement
  • The Importance of Coaching in Professional Development

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Pat McNeil on LinkedIn

Chart House Solutions

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Blog

The Character Imperative in Leadership: A Lesson for Compliance Professionals

When discussing leadership transitions at troubled organizations, one recurring theme is often overlooked: character’s pivotal role in shaping culture and outcomes. In an MIT Sloan Management Review article entitled “Make Character Count in Hiring and Promoting,” Mary Crossan posited, “Most managers focus on competencies when evaluating candidates—but it’s a character that will transform the DNA of the organization.”

The recent challenges faced by Boeing serve as a cautionary tale for compliance professionals worldwide. Despite their technical prowess and storied history, Boeing’s leadership failures, rooted in compromised decision-making and a lack of character-driven judgment, led to catastrophic consequences for safety, public trust, and, ultimately, their bottom line.

The leadership debate at Boeing has focused narrowly on whether the next CEO should be an engineer or an accountant, emphasizing competencies over character. This approach underscores a persistent failure across industries to recognize that strong character-based judgment is a cornerstone of ethical leadership and compliance success.

This offers a critical lesson for compliance professionals: character matters as much as, if not more than, competence. The organizational culture we build reflects the character of the individuals we hire, promote, and retain. Compliance leaders must champion character as a vital element in talent development and how to embed this principle into their practices.

Competence vs. Character: Understanding the Difference 

Competence concerns what someone can do, their technical skills, knowledge, and experience. It varies by organization, role, and level within the hierarchy. In contrast, the character is about who someone is. It’s universal and intrinsic, shaped over a lifetime, and critical to ethical decision-making.

Research shows that character comprises 11 interconnected dimensions, each manifesting in observable behaviors. These dimensions include courage, humility, temperance, accountability, and judgment. Importantly, character isn’t static; it’s a habit that can be developed and refined over time.

When organizations equate character with a narrow set of qualities, such as drive and accountability, they risk embedding toxicity and poor judgment into their culture. For example, a leader with unrestrained courage may veer into reckless decision-making without the tempering force of humility. Such imbalances ripple through the organization, driving disengagement and turnover among those with stronger, more balanced character.

This interplay between character and culture is a leverage point for compliance professionals. We can foster ethical cultures prioritizing accountability, transparency, and trust by elevating character assessments to the same level as competence evaluations. 

Character Interviews: A Tool for Compliance Leaders

Traditional interviews focus on competencies through structured questions and rubrics. Character interviews, however, require a more nuanced approach. They are conversational and personalized, designed to explore a candidate’s life story and reveal their character dimensions.

Here are key considerations for conducting effective character interviews:

  1. Prepare by Developing Your Own Character. To assess the character of others, interviewers must first reflect on their biases and imbalances. For instance, understanding the dimension of justice requires recognizing how systemic privileges and inequities shape perceptions of fairness.
  2. Engage in Genuine Conversations. A character interview should feel less like a formal assessment and more like exploring the candidate’s experiences, motivations, and values. This approach uncovers the layers of their character organically.
  3. Probing Questions and Observational Insights. Start with broad, open-ended questions and follow the threads of the candidate’s responses. For example, if candidates emphasize their innovative drive, explore how they’ve balanced it with temperance or collaboration.
  4. Cluster Dimensions to Identify Strengths and Weaknesses .Character dimensions are interconnected and should be evaluated holistically. A candidate with strong accountability and courage but weak temperance might struggle to balance ambition with thoughtful decision-making.
  5. Assess the Interviewer’s Character. Character interviews reveal the interviewee’s strengths and weaknesses as well as the interviewer’s. Candidates often assess organizations based on the character of those conducting the interviews.

Character in Promotions and Talent Development

Promotions signal what qualities an organization values most. When those decisions prioritize competence over character, they risk elevating individuals whose imbalances could undermine ethical culture.

One effective approach is integrating character assessments into 360-degree reviews for promotion candidates. For example, an organization identified a highly competent leader whose humility and collaboration needed development. By assigning him to an unfamiliar overseas role, they created an environment where he had to rely on others and build relationships, strengthening his weaker character dimensions.

Compliance professionals can advocate for similar strategies, ensuring that promotions are about past performance and readiness for ethical leadership.

Building Character-Based Cultures in Compliance

Embedding character into hiring and promotion decisions isn’t just about individual roles; it’s about shaping organizational DNA. Here is how compliance teams can lead this transformation:

  1. Educate on the Importance of Character. Host workshops or training sessions on the 11 dimensions of character and their relevance to compliance and ethical decision-making.
  2. Develop Character Assessment Tools. Create structured yet flexible frameworks for evaluating character in interviews, performance reviews, and succession planning.
  3. Provide Feedback for Development. Constructive feedback helps individuals recognize and address character imbalances. Compliance leaders can normalize character development as an ongoing process.
  4. Model Character-Driven Leadership. Compliance teams should exemplify the values they seek in others, demonstrating integrity, transparency, and humility in their interactions and decision-making.

The Compliance Professional’s Role

Character-driven leadership is essential to navigating today’s complex ethical landscape. For compliance professionals, this means advocating for systems that value character alongside competence. It means challenging the status quo in talent management and championing leaders who embody integrity, humility, and balanced judgment.

Boeing’s leadership failures are a stark reminder of what happens when a character is sidelined. By prioritizing character in our organizations, we can mitigate risk and build cultures that inspire trust, accountability, and long-term success.

Your corporate compliance function’s future and your entire organization depend on it.

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Sunday Book Review

Sunday Book Review: December 15, 2024 – The Top Leadership Books from 2024 Edition

In the Sunday Book Review, Tom Fox considers books that would interest the compliance professional, the business executive, or anyone who might be curious. These could be books about business, compliance, history, leadership, current events, or anything else that might interest Tom. This month of December, we will review the top books in some key areas of interest for compliance professionals. This week, we will review four books on leadership from 2024.

  • Atomic Habits by Nick James Clear
  • Start with Why by Simon Sinek
  • Trust and Inspire by Stephen Covey
  • The Culture Code by Daniel Coyle

For more information on the Ethico Toolkit for Middle Managers, available at no charge, click here.