Compliance and Ethics: Ideas & Answers. Edition 81

Dear friends,

Welcome to the 81st edition of Compliance and Ethics: Ideas & Answers.

In this edition, Adam Balfour reflects on the ethics and compliance lessons we can learn from Alan Mulally's leadership at Ford. Mulally’s approach to encouraging transparency and speaking up, even in the face of potential criticism, offers valuable insights for leaders striving to build a culture of trust and openness. Adam highlights how recognizing and rewarding those who raise concerns can transform an organization's approach to ethics and compliance.

In our second article, I revisit the concept of "Recognition Certificates" as a small yet impactful tool in your compliance toolkit. Recognizing employees for completing compliance training, whether through a tangible certificate or a digital accolade, can serve as both an incentive and a reminder of key compliance principles. I share ideas on how these certificates can be used creatively to reinforce your compliance message long after the training is complete.

As always, we end with a touch of humor in our regular feature, Compliance Lite.

And don't forget there's more content on our website so please do visit us there to read our other articles.

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Thank you, Joe.

Ethics & Compliance Lessons From Alan Mulally

by Adam Balfour

There is a fairly well known story of a moment shortly after Alan Mulally took over as Ford CEO in 2006. Mulally introduced a weekly leadership meeting with his reports and they had to present updates using a green, yellow or red status. Despite the significant challenges at the time, most of the presenters were showing their projects as green. Mark Fields was the first leader to present a red status update on a project - as he shared his update. most of the other people in the room supposedly went quiet, looked down and waited for what they expected would be negative consequences (there is a good video online where Mark Fields says he “could feel the chairs moving away” from him).

The story goes that Alan Mulally started clapping and celebrated Mark Fields in the meeting for raising the issue. He wanted others to see that sharing concerns and issues provided an opportunity for others to help and address the situation. Presenting a red status update was not a career ending move for Mark Fields - he went on to be Mulally’s successor and served as CEO from 2014 to 2017.

So what are the ethics and compliance lessons here?

1. Leaders play a key role in making others feel comfortable enough to speak up - it isn’t about simply promoting the different speak up channels, leaders need to build trust with others, encourage them to raise concerns and listen when they do;

2. Speaking up is difficult, even for high up executives. Having an important title doesn’t change the fact that most people find speaking up difficult;

3. People should be recognized and rewarded for speaking up, both in the moment (with Mulally’s clapping and public praise) and in the long run (Fields becoming CEO). Speaking up should not be a career ending move (and it wasn’t for Mark Fields), but there are many examples of people who have spoken up and suffered retaliation and blacklisting as a result (if you want to learn more about the human impact of retaliation and blacklisting, I cover this in Chapter 5 “The Speaking-Up Problem” in Ethics & Compliance For Humans); and

4. If issues are not being raised, it does not mean that there are no issues - it might mean there are issues, but people do not feel comfortable raising them.

Recognition Certificates – a small but memorable compliance reminder

by Joe Murphy, CCEP

In a book I wrote for SCCE, 501 Ideas for Your Compliance and Ethics Program (2008; SCCE), I listed as idea #170 “Recognition Certificates” for those who have completed compliance training.?This could be for a specific course, or it might represent completion of the year’s training.?

Recognition and an incentive. A recognition certificate would fit in well as part of your compliance program to meet the incentives element of an effective compliance and ethics program.? Of course, there should be much more relating to incentives; compliance should play a role in very serious matters like bonuses and promotions. But small or symbolic rewards also have a place in your program.? And what may be small to an outsider may be very meaningful for an individual employee. Getting some form of recognition may be a nice lift for someone.??

Recognition could also be shared with the supervisor.? So the boss who is most successful in making sure everyone attends the training could also receive a certificate of recognition.?

I tend to think of a certificate as paper, suitable for framing.? But in today’s environment it could also be a very cool digital offering. This would make it easy for the employee to share with others or post in their own social media.? ?

Refreshing the message. In doing work for a client where I provided antitrust training, I took this one step further.? Training is important, but not the only means of communication for compliance messages.? In an antitrust training certificate that we arranged to have provided to employees I prominently included a list of key compliance points, right on the certificate.? That way we had double duty from the certificate:? it recognized the employee’s accomplishment, but also promoted the specific compliance message.? The points covered important substantive aspects of antitrust law that applied to the trainee’s work activities – these were things we wanted to be sure the employee remembered.?

Continue reading on our website...

“Good judgment comes from experience – And experience comes from bad judgment!”

I was just reminded of this saying by a Wall Street Journal book review relating to neurosurgeons. I have always found this saying to be clever and funny. But it goes to the truth that the only way to avoid mistakes is to do nothing. If we do things we will make mistakes. Of course this is not a license to do bad things, but it does mean that we all have much to learn throughout our lives. We learn best by doing, and when we do things we have to expect to make mistakes.

Personally, I find that it is certainly true that bad judgment teaches you things. However, for purposes of learning I find it much more enjoyable to learn from reading the Wall Street Journal every day than from making embarrassing mistakes.

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