Welcome to Day 1 of 30 days to a better compliance program. Together with a podcast each day, I will be giving you tips to help you create a best practices compliance program in 2017. At the end of January, you will not only have a good summary of the basics of a best practices compliance program but information that you can incorporate into your compliance regime.
Tone at the Top has become a phrase inculcated in the compliance world. The reason it is so important to any compliance program is because it does actually matter. Any compliance program starts at the top and flows down throughout the company. The reason all of these guidelines incorporate it into their respective practices is that all employees look to the top of the company to see what is important.
At the Top
So how can a company overcome these employee attitudes and set, or re-set, its “Tone at the Top”? I once had a Chief Executive Officer (CEO) of a client who described his role at the company as “the ambassador for compliance.” I can think of no better description of the role of a CEO for a best practices compliance program.
In the Middle
A company must have more than simply a good ‘Tone-at-the-Top’; it must move it down through the organization from senior management to middle management and into its lower ranks. This means that one of the tasks of any company, including its compliance organization, is to get middle management to respect the stated ethics and values of a company, because if they do so, this will be communicated down through the organization.
What should the tone in the middle be? Put another way, what should middle management’s role be in the company’s compliance program? This role is critical because the majority of company employees work most directly with middle, rather than top management and consequently, they will take their cues from how middle management will respond to a situation. Moreover, middle management must listen to the concerns of employees. Even if middle management cannot affect a direct change, it is important that employees need to have an outlet to express their concerns. Therefore, your organization should train middle managers to enhance listening skills. This can be particularly true if there is a compliance violation or other incident which requires some form of employee discipline. Most employees think it important that there be organizational justice so that people believe they will be treated fairly. Without this organization justice, employees typically do not understand outcomes but if there is perceived procedural fairness then an employee is more likely accept a decision that they may not like or disagree with the final result.
Tone at the Bottom
Even with a great ‘Tone-at-the-Top’ and in the middle, you cannot stop. One of the greatest challenges for a compliance practitioner is how to affect the ‘tone at the bottom’. To do so, you must work to engage those at the front lines, including training, communication and the tools to accomplish these tasks. A key question is how to tap into this belief system? I think the answer is to engage employees in a manner which allows you to not only find out what the employees think about the company compliance program but use their collective experience to help design a better and more effective compliance program. It is my belief that employees want to do business in an ethical manner. Given the chance to engage in business the right way, as opposed to cheating; will win the hearts and minds of your employees almost all of the time.
The bottom line is that not only must a company ‘talk-the-talk’ of compliance but it must also ‘walk-the-walk’ of compliance. It really is about the culture of compliance in your organization because the real issue is whether or not that culture has embedded itself in middle and lower management. A company’s culture is reflected in the values and beliefs that are exhibited throughout your company. You must find a way to articulate and then drive the message of ethical values and doing business in compliance with such anti-corruption laws such as the FCPA from the top down, throughout your organization.
For more information on this Hallmark, check out my book Anti-Bribery Leadership, which is available through Amazon.com by clicking here.