By: Douglas Allen
The Society of Corporate Compliance and Ethics recently returned to Arizona to host the Scottsdale regional conference. The 2017 iteration conference include an evaluation of changes in the cyber security and privacy landscape, developing an effective program in light of the FCPA pilot program, and how sales incentives impact culture.
Among the standout sessions included “Business Awareness and Mood in the Middle” as presented by Stephen Nehring, CCEP, CFE, Global Compliance Manager, Lex Zerwas, Director Operations Strategy and Controller, and Cynthia David, Director of Global Supply Chain NA., from Phoenix, AZ-based Freeport-McMoRan.
Nehring, Zerwas, and David all emphasized the importance of face time when communicating the importance of compliance across your organization – no matter how remote or inconvenient accessing some employee populations may be. Another hot-button topics was the importance of engaging with your employees at their home sites or locations, instead of a conference room at the corporate headquarters, as to encourage a more open dialog by communicating on their “home turf”.
The Freeport-McMoRan compliance team emphasized that all compliance professionals should be keeping value at the top of mind when engaging with employees of all levels across the enterprise. As is often the case, management will face distraction after distraction from all areas of the business. Compliance professionals need to be prepared to sell management and leadership on the importance and value of compliance every time.
The Freeport-McMoRan team recommended compliance professionals engage in the exercise of asking themselves “why are you here?” and “what value are you adding?” before engaging with leadership to ensure the focus is on value-add and not compliance for compliance’s sake.
In line with Ethisphere’s aim of measuring and facilitating an ethical corporate culture, Charles Laugen, CFE, CFCI, Director, Corporate Investigations at Prudential Financial and David Welsh, PhD, JD, Assistant Professor Management at Arizona State University led a discussion on “Sales Incentives Impact on Corporate Culture”.
Welsh illustrated how misguided incentive systems can result in unintended consequences, as was the case with Wells Fargo aggressively pushing daily and sometimes hourly cross-selling goals that resulted in the creation of over a million unauthorized accounts – and $185 million in fines.
The key to effective goal setting, as explained by Welsh, is to motivate not only performance through goals, but also moral awareness. Over time, high-pressure goals give employees the opportunity to rationalize otherwise questionable behavior in pursuit of said goals.