To help prepare compliance professionals for the year ahead, we’ve talked with industry experts, our colleagues at NAVEX Global, and ethics and compliance professionals from our more than 12,500 client organizations to gather insights on the top issues and trends that will impact compliance programs in 2016. We’ll share each of the trends here over the next few weeks.
You may have already seen the signs of employee cynicism, fatigue or compliance pushback at your organization. Its presence is often indicated by little things. Over the years, some of these signs have become so common we’ve given them names:
- The silent elevator. The all-too common experience of ethics and compliance officers when they enter a room, or an elevator, and conversation stops.
- The eye roll. The expression we’ve seen from employees during live training or focus groups that says: “Here we go again,” “They’ve got to be kidding,” or “I’m missing work for this?”
- The snicker or harrumph. Similar to the eye roll, this is a quick and barely audible reaction by employees as they listen to leaders deliver what are perceived to be insincere messages about ethics and values.
Sometimes we describe the phenomenon as survey, training or compliance fatigue. And it’s not just line employees who exhibit it. Leaders are just as likely to lack engagement and seem to be going through the motions when it comes to E&C.
The anecdotal evidence of compliance pushback is now supported by surveys.
In NAVEX Global’s 2015 Ethics & Compliance Training Benchmark Report, 37% of respondents thought employee cynicism was the top threat to the effectiveness of their E&C training programs.
Over the years, NAVEX Global’s Advisory Services team has seen evidence of this attitude—even in companies with mature E&C programs.
For our culture assessments, we’ve led more than 1,300 in-person focus groups with employees at all levels, in many countries and from every industry, and we’ve heard candid comments about what employees really think about leadership, training, codes and surveys.
While we usually ascribe low helpline call volume to employee belief that “nothing will get done” or a fear of retaliation, we’ve also heard evidence that suggests it may be in part be a reaction to E&C efforts that have gone too far or lost perspective.
As one employee noted: “No, I’m not worried about retaliation…I don’t call [the helpline] because so many of these rules are just ‘gotchas.’ I’m not going to get all involved and get someone fired over a [expletive] gift basket.”
While it’s safe to say that these sentiments are not held by a majority of employees, they do reflect the views of a significant minority. Left unchecked, they can erode even your best efforts.
Key Steps for Organizations to Take
1. Don’t assume “it can’t happen here.”
Remember: Corrosive attitudes foster disengagement. Some cynical employees will tell you so, but others would rather just go along and try to minimize interaction with your office.
For this reason, it’s easy to underestimate the depth of the problem. Long term, the best solution to get a true assessment of your organizational culture is to first build credibility and trust. Only then are you likely to gain the needed access and insights.
But in the short term, rely on your colleagues who may be in a better position than you to take the true pulse of your organization.
2. Focus on leadership at all levels.
Often, leaders don’t realize the impact their behavior can have on shaping organizational culture. An offhand remark or a dismissive attitude can speak volumes and can supply justification to employees who are already inclined to push back. Active participation and engagement by managers helps demonstrate the organization’s commitment to E&C. Helping managers to understand the influence they exert and to avoid sending the wrong message is a good first step.
But sometimes the problem is deeper than just inadvertent statements. In our 2015 Ethics & Compliance Training Benchmark Report, 34% said mid-managers do not display desired compliance behavior. This becomes a dangerous precedent since employees take their managers’ nonchalance as permission to do the same. Holding managers consistently accountable requires support from the top, and is a key element in setting the right tone.
Also, be aware of who you employ to deliver the E&C message. While your options may be limited, be aware that if your message is delivered by a senior leader or manager who is known to be “ethically challenged,” you are throwing gasoline on the fire of cynicism. Do what you can to select credible spokespersons.
3. Start with the most egregious sources that fuel cynicism and compliance pushback.
Our experience has shown that there are four common sources contributing to the problem:
- Insincerity. Employees can spot insincerity a mile away. As noted above, you need to pay attention to who delivers your E&C message. But just as important, watch out for content that is too far removed from reality. If your organization has had compliance lapses, it’s best to address them in a frank and honest way. Value statements are a common way to express foundational principles, but they must be grounded in your organization’s actual culture and should be articulated and developed from the ground up.
- Wasting employees’ time. Nothing frustrates employees more than training, emails, surveys and meetings that are not relevant to their work, start late or are perceived to be unnecessary. In the coming year, if you do nothing else to address cynicism, vow to be more respectful of employees’ valuable time. Develop a multiyear E&C communications and training plan that will help you target your training and communications to specific roles and responsibilities—and don’t be afraid of using your red pen. Edit your training and communications. Short and simple is best.
- Inconsistency. Employees often believe that rules are inconsistently applied. You should make it a priority to demonstrate consistent discipline. Don’t worry too much about the limitations of publishing or announcing personnel decisions. If top producers and leaders are disciplined for ethics transgressions in the same ways that others would be, word will get around.
- Lack of transparency. When employees see E&C in action, they know their organization walks the talk. This may be as simple as thanking employees for reporting issues and letting them know the investigation is closed, or—the most transparent option—publishing summaries of E&C issues and their resolutions. Using sanitized cases from within your own organization can be an excellent tool to bring E&C to life.
4. Long-term: Reposition the E&C office as a strategic risk management ally, not just the people who say no.
One of the underlying sources of compliance pushback is the opinion that the E&C office is not aligned with the organization’s business goals but is instead a “necessary evil,” a “CYA” function or The People Who Say No. Rebranding your office as a positive contributor to the business and a key part of the management team is a long term goal, but moving in that direction will pay immediate dividends.
Begin with small steps. For example, meet with key managers and ask them how your office can help them meet their goals and solicit their suggestions on ways to collaborate and improve efficiency and effectiveness. Focus discussions on risk identification and management strategy. Talk less about the U.S. Sentencing Guidelines and more about operational effectiveness.
The growth of cynicism is not entirely within our power to control. Employee cynicism and the resulting compliance pushback is part of a much broader public frustration on many fronts. In particular, we may be seeing signs that public support for business ethics is slipping. Thirty years have passed since the creation of the first E&C programs and many doubt much progress has been made.
In the coming year, we need to pay more attention to the public sentiment and ensure their support of what we do. Those of you who are members of ethics and compliance member associations should consider encouraging associations to do more outreach to publications and media beyond those that typically serve our industry.
For more expert tips on combating cynicism and promoting a healthy compliance culture, contact us today.
