The Compliance and Ethics Blog

SCCE/HCCA

B is for Bribery (Actually Anti-Bribery)

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Copyright © 2018 by Barney Rosenberg
President, Ethics Line, LLC™
barney@ethicslinellc.com

After a modest dinner with a foreign supplier, you are driving him to the modest hotel you booked for him.  He hops out at his hotel and as he is closing the car door, he says:

‘I left something for you on the back seat.”

You’re puzzled but ignore it and continue on your way. It’s only when you arrive home that you remember what he said and you reach into the back seat and take the small package with you.  Your spouse says: “What’s that?”  And you say: “I don’t know.”

Then, inside, you find a plain white envelope. ‘Is that what he meant?’ you think. And then you see what turns out to be $10,000 in crisp new $100 dollar bills! inside a Victoria’s Secret shopping bag!  I can’t make this stuff up!

Thinking it could not have been meant for you, you take out your mobile phone to call him. But then you pause. ‘Is he for real?’

Before you make up your mind about his intentions, you can’t help but start thinking. That’s a lot of money. It’s bribery. It’s not traceable. It’s a vacation. I’ve got to report this … the thoughts come thick and fast.

Before you ask if this is a bad TV show, let me tell you that no, this happened to one of my colleagues. And yes, it really was a Victoria’s Secret shopping bag. At 6 am the next morning, after what was probably a rather restless night, the colleague called me and asked for advice.

I had him write down the serial numbers of the bills. We returned the cash and fired the supplier, who loudly proclaimed that it was all innocent.  It was meant to cover a holiday lunch for the workforce at the plant.  Uh huh! Right!

It’s a great story because it’s not the kind of thing that happens to any of us every day and there was a very clear choice involved.

Cutting a corner to hit a target or greasing our way to lucrative new business might seem tempting in the short term. Offering or accepting a payment like this one is NEVER ok.  A good reputation takes years or even decades to create and only moments to destroy.

You may quote me on this:  Ethics is what we do when no one is looking!

Think about your company’s brushes with bribery.  What can you say about them?  What can you do to prevent them?

A is for Audit

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Copyright © 2018 by Barney Rosenberg
President, Ethics Line, LLC™
barney@ethicslinellc.com

This is as good a place as any to begin our scan of the ethics alphabet.  Audit and awareness.  Unless we look closely at the impact of our ethics programs, policies and procedures, we are flying blind.

There are two basic kinds of audit: internal and external.  Think about how your organization approaches each one.

A global company I know very well has a robust set of policies and procedures for its domestic and international operations.  High on the list of ethics priorities is how they manage the shark-infested waters of international intermediaries – sales representatives and distributors.  They can’t be everywhere so why not get some sales help with the selection and management of intermediaries?  Key is to understand the law in the foreign jurisdiction and the corruption risk in that territory.  Document the full terms and conditions of the written agreement.  Make sure you can disengage when necessary.  I wrote the policies for that company.  It’s a challenge, as you know.  Some agreements had been in place for 20 years and no one had looked at them since they were executed! [Read more…]

Just Breathe: Connecting Wellness to an Ethical Culture

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By Bonnie Silvestri
JD, CCEP

Recently, Gerry Zack, incoming CEO of SCCE & HCCA and Adam Turtletaub, Vice President for Strategic Initiatives and International Programs for SCCE & GCCA, led a webinar called “How Corporate Culture Impacts Compliance – And What to Do About It!” The webinar got me thinking about all the different ways in which an organization can enhance its ethical culture.

During my weekly yoga class, in between carefully calibrated breaths, I pondered how a well-designed wellness program such as we have in Sarasota County Government can go a long way toward maintaining an ethical culture. Sarasota County has as its mission to be the “most livable and best managed community in the country.”

After our final resting pose, I realized that spending Friday afternoons with a group of co-workers coming together to care for our mental and physical well-being leads to a feeling of trust.

I hope that after over a year getting to know me in a context outside of an orientation session, an all-hands meeting, or even an investigation, employees will feel more comfortable reaching out with questions or concerns.

Additionally, employees are likely to feel a greater level of ease broaching ethics and compliance concerns in a work environment that has placed a premium on their own health and wellness. As Nancy Paradise, the county’s manager for employee health and benefits stated: “We are focused on the total well-being, the entire being.” The County offers yoga, relief and resiliency programs, and even classes in Heart Math, teaching you to slow down and regularize your breathing patterns in a heart-focused way. These offerings and more are aimed at helping employees de-stress and increase their focus.

When you feel your personal well-being is valued, it is far more likely that you will also be concerned about the overall health of the organization.

Zack said ethics and compliance staff should consider “using every possible means to achieve your goals” and to enhance the avenues through which employees can come forward with the simplest questions to concerns about a wide-range of complex compliance issues.

Therefore, it seems that we should consider every tool in our tool belt. This can range from having approachable and engaging materials focusing on aspirational goals, to frequent opportunities to work in a cross-disciplinary way throughout an organization, to employee appreciation and recognition events and even to establishing and maintaining a robust wellness program.

This ensures that as Zack said, we are letting the tone “cascade” from the top through the various levels of an organization. The metaphor of ethics and compliance cascading throughout an organization makes me think of a waterfall where rivulets and streams come together to create a great rush of energy meeting in the same place. Presumably, when everyone is in their flow it leads to a healthy ethical culture, and that is our goal.

Personal Integrity or Corporate Culture?

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Robert Bienkowski, PhD, CIP, CHRC
Director, Office of Research Compliance, Central Michigan University

I was booked on a nonstop flight from Detroit to Seattle to attend a biosafety compliance conference. Everyone had boarded, and we were waiting for the crew to close the cabin doors and push back from the gate for an on-time departure. I was enjoying that rarest of economy class luxuries, an exit row all to myself.

Then the captain came on the intercom and said there’d be a short delay in leaving: a technician was just finishing a repair to something on the first officer’s side of the cockpit. A few minutes later the captain was back on the intercom and said that the repair was completed but the technician, who by this time had already left, wrote on the worksheet that the repair was done on the captain’s side of the cockpit. The captain said he could understand how the mistake happened, but the notation had to be corrected before we could leave the gate. [Read more…]

Ethics not as Simple as Right or Wrong, or is it?

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By Calin Elardi
MBA, CHC, CHPC, CCEP, CCEP-I

We all want to be ethical, that’s part of the reason we are in compliance and ethics, right? But what does it mean to be ethical? What “ethical” means to you may not be the same as what it means to everyone else, and it is essential that you and your company agree on what is considered ethical behavior.

The dictionary defines ethics as “that branch of philosophy dealing with values relating to human conduct, concerning the rightness and wrongness of certain actions and the goodness and badness of the motives and ends of such actions.” There are several schools of thought when it comes to the philosophy of ethics; three main are; formalism, utilitarianism, and fairness and justice. Each of these approaches looks at issues differently and places values on different results, groups or individuals to determine if any given act is ethical. So how do your ethics align with the three main philosophical branches?

Formalism highly values the rights of the individuals and individual liberties. A formalist would want all people to be treated the same way that you are treated. Formalism especially bases its ethical reasoning on the act itself being ethical or not.

Utilitarianism believes that it doesn’t matter what the ethics are for the act itself, just the ethics of the consequences. For a utilitarian, the ends justify the means and what action creates the most good for the most number of people.

Fairness and justice believe that everyone no mater seniority, personal circumstances or any other potential reason should always all be treated the same.

So where do you fall among these three ethical ideologies, and where does your company fall? Quite often in life, it feels like it can depend on the situation. However, if you can identify where you stand and where your company stands as this ethical tightrope, you may be better able to not only understand your decision making but also the decisions of the company.

Dale Skivington and Page Motes on Compliance, Ethics, Mergers and Acquisitions [Podcast]

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By Adam Turteltaub
adam.turteltaub@corporatecompliance.org

It is generally reported that about half of all mergers and acquisitions fail on culture issues.  It’s also well known in the compliance community that the integration of two companies is often fraught with risk.  What is okay in one company may not be okay behavior in another.  Plus, in the chaos of change, there is great danger if the compliance controls get lost in the shuffle.

In 2016 Dell Technologies completed its acquisition of EMC Corporation, which virtually doubled the company’s numbers of employees.

In this podcast two members of the Global Ethics & Compliance Team – Dale Skivington, Vice President of Compliance, and Page Motes, Director of the Strategic Programs Office — share how Dell made the integration work.  They recount the experience Dell had from past integrations as well as some of the specifics that went into this very large undertaking.  Listen in and enjoy some key takeaways including:

  • The importance of making the compliance integration part of the broader integration program
  • The need to communicate frequently, regularly and in a structured way
  • The role that key strategic milestones played
  • How setting key actions items to the milestones helped
  • The value of a collaborative approach

Ethikos Editor’s Weekly Picks: For a Culture of Integrity, Focus on Fairness

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Examining ethics and compliance issues in business since 1987

For a culture of integrity, focus on fairness

By Anne R. Harris for National Defense
Organizational ethics and compliance is about encouraging people to conduct business with integrity. It is also about mitigating risks: the risk that the organization could lose money, that it could face legal liability, that its employees could be injured, that its customers could suffer damages, that its reputation could be ruined and so on.

Business leaders who pursue a strategy to “promote an organizational culture that encourages ethical conduct and a commitment to compliance with the law,” as recommended in the Federal Sentencing Guidelines for Organizations [USSG §8.B2.1(a)(2)], aim to create a work environment that will sustain positive performance and long-term success, partly by reducing the likelihood of ethical or compliance failures. Read more

Biomedical science education needs a new philosophy, Johns Hopkins researchers say

By Barbara Benham for HUB 
Today’s graduate biomedical science education system is in need of comprehensive reform, two researchers at the Johns Hopkins Bloomberg School of Public Health argue in a new paper.

Current programs, they write, are successful at teaching students how to conduct deep research. However, graduates can be too specialized and ill-prepared for a diverse job market. In addition, they are not trained in critical thinking and creative problem-solving. Read more

Employers… are you equipped to handle sexual harassment complaints?

By Terry Gray for Birmingham Business Journal
Doing business in today’s environment is highly risky for employers who can face litigation and lose productivity when workplace conduct issues arise.

In light of the recent frequency of sexual harassment allegations capturing the headlines, now is an important time for employers to understand the significance of having proper policies, training and accountability in place in order to best protect their employees and business. Every company faces complex employment issues, yet many business owners are unaware of the legality of employment related matters. Read more

What do investors value, ethics or returns? Startup bets on both

By Julie Verhage and Rachel Evans for Bloomberg
It used to be a choice: follow your conscience or chase returns. But now one Southern California startup is betting its strategies can deliver both kinds of value — market and ethical.Read more

5 signs your organization might be headed for an ethics scandal

By Alison Taylor for Harvard Business Journal
Corporations often approach ethics as an individual problem, designing oversight systems to identify the “bad apples” before they can turn the organization into a “rotten barrel.” But at places like Wells Fargo, FIFA, and Volkswagen, we can’t fully describe what happened by reading profiles of John Stumpf, Sepp Blatter, or Martin Winterkorn. Bad apple explanations also fail to explain the string of ethical crises at Uber, the long-term impunity of powerful men who sexually harass colleagues, or any of the other ethics scandals we’ve seen this year. Rather, we see a “tone at the top” underpinned by widespread willful blindness, toxic incentives, and mechanisms that deflect scrutiny. These conditions seem to persist and metastasize. They replicate despite changes in leadership and in management systems. Read more
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The most interesting business ethics, culture and leadership articles delivered right to your email every week! Browse selected articles for inspiration, tips and great ideas on how to implement and maintain a healthy business culture. Stay on top of new insights, how-tos, and interviews from around the world—all from the comfort of your desk. Subscribe now.

ethikos is a publication of the Society of Corporate Compliance and Ethics

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Ethikos Editor’s Weekly Picks: Can Business Schools Make Companies Ethical?

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Examining ethics and compliance issues in business since 1987

ethikos e-newsletter will not be published the next two weeks. The next issue will be dated January 9, 2018.

Can business schools make companies ethical?

By Megan Kamerick for Fast Company
Corporate misanthropes are nothing new, but Martin Shkreli is a special case. He became one of the most hated men in America for a while when he gained the rights to a lifesaving drug and then boosted the price by 5,000%, basically because he could. That wasn’t illegal, just casually cruel. Read more

Is the ‘business hug’ headed for extinction? Mixed opinions on when to go beyond the handshake

By Wayne T. Price for Florida Today
When a male colleague recently returned to the University of Central Florida in Orlando from sabbatical a few weeks ago, Maureen Ambrose went to hug him.

“Is this still allowed,” he asked Ambrose, the Gordon J. Barnett Professor of Business Ethics in the College of Business at UCF. Read more

3 A.I. predictions for 2018: emotion, data, ethics

By Rana el Kaliouby for Xconomy
The A.I. age is upon us, and understandably, some are concerned about the social, moral, and ethical implications the technology will have on humanity, from threats to jobs, to concerns with privacy.

In 2018, we’ll see more industry collaboration, like that of the Partnership on Artificial Intelligence, and an open dialogue to discuss things like how we can ensure that people developing and training A.I. algorithms avoid replicating societal biases. Companies will come to understand that building algorithms that avoid bias is not just the right thing to do, but good for business. And, in turn, A.I. ethics will become a fundamental part of computer science education. In the same way medical students must take medical ethics classes, computer science students will be required to take A.I. ethics classes. Read more

More than half of Hong Kong-listed companies do not meet corporate governance requirements

By Laura He for South China Morning Post
A new global report on corporate governance performance has found more than half of Hong Kong’s largest listed companies failed to meet some aspects of the government’s voluntary standards, although the rate is an improvement on last year.

Forty six per cent of the Hang Seng Composite Index (HKCI) constituent companies are now in full compliance with the “Corporate Governance Code” issued by the Hong Kong Exchanges and Clearing (HKEX) in January 2005, according to Grant Thornton Hong Kong’s 2017 Corporate Governance Review, which assesses compliance with voluntary codes in the city each year. Read more
Join SCCE and become part of the compliance profession

Subscribe to ethikos

The most interesting business ethics, culture and leadership articles delivered right to your email every week! Browse selected articles for inspiration, tips and great ideas on how to implement and maintain a healthy business culture. Stay on top of new insights, how-tos, and interviews from around the world—all from the comfort of your desk. Subscribe now.

ethikos is a publication of the Society of Corporate Compliance and Ethics

SCCEnet SCCE's Compliance & Ethics Blog SCCE on LinkedIn Twitter Facebook Google+ YouTube Twitter
SCCE logo Society of Corporate Compliance and Ethics 
6500 Barrie Road, Suite 250
Minneapolis, MN 55435 United States
+1 952 933 4977 or 888 277 4977
service@corporatecompliance.org
www.corporatecompliance.org

Human Trafficking and Modern Slavery Part 2: A Discussion with William Shephard [Podcast]

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By Adam Turteltaub
adam.turteltaub@corporatecompliance.org

In Part 1 of this two-part podcast on human trafficking and modern slavery we explored the scope of the issue and the risks to organizations that they may inadvertently have victims within their supply chain, or even working in their facility.

In this podcast, William Shephard, a partner in the Washington and West Palm Beach offices of Holland & Knight, explains that there are specific compliance requirements already on the books that organizations must include in their compliance plans.  He explains that:

  • There are already two types of laws on the books
  • The first set requires reporting efforts by the organization to examine its supply chain for human trafficking and modern slavery
  • California and the UK already have strong disclosure requirements, and the subsequent California regulations goes well beyond simple disclosure
  • The second set of compliance requirement prohibit purchases by US Federal government entities from organizations that do not certify that their supply chain is free of human trafficking and slavery
  • It is essential to look out for warning signs that the workforce may include victims of human trafficking and modern slavery
  • Warning signs include whether there is a written contract in the employee’s native language with the employer and if the employee must surrender his or her passport to the employer
  • Other red flags to look for include recruitment fees that employees must pay to get the job and substandard pay and housing
  • For those in healthcare, there are already requirements to post information

Human Trafficking and Modern Slavery Part 1: A Conversation with Stephanie Molen [Podcast]

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By Adam Turteltaub
adam.turteltaub@corporatecompliance.org

It seems shocking that estimates put more than 40 million people around the world today working in slavery.  It is a horrifying statistic, but it can seem like a distant problem, one that occurs in isolated parts of the world.

The evidence shows that it is far closer than people think.  It can be found in supply chains of global companies and even in the US, where estimates are that over 14,000 people are trafficked into the country annually.

Stephanie Molen is the Director of Partnerships at the Coalition to Abolish Slavery & Trafficking (Cast).  In this podcast, she explains the scope of the issue of human trafficking and modern slavery both within the US and internationally.

She explains that labor trafficking is quite broad and can be found in a large variety of industries, not just low wage jobs. High-risk industries, she tells us, include manufacturing, agriculture, and hospitality, with domestic care increasingly becoming high risk.

She also takes us through how recruiters defraud workers and create a form of indentured servitude.

Finally, she explains what to do if you suspect a worker in your organization is a victim and how social services organizations can help.

In Part II of the podcast, William Shepherd, a partner at the law firm of Holland & Knight, will explore the increasing number of compliance requirements for organizations to identify potential human trafficking and modern slavery in their supply chain.