implementing ethics in the workplace: creating the process (abridged version) a program of the...

Implementing Ethics in the Workplace: Creating the Process(Abridged version) a program of the Greater Omaha Business Ethics Consortium

at Creighton University

Sponsored by

The Seven Sentencing Guidelines

1. Having Standards

2. Assigned Responsibility - Adequate Resources

3. Due diligence in Hiring

4. Communications and Training

5. Monitoring, Auditing, Reporting

6. Promotion and Enforcement of Ethical Conduct

7. Reasonable Steps to Prevent Misconduct

The Challenge is Doing More with Less1. Have a Plan - preferably a long range plan2. Have support at the Top and an “Ethics Team”3. Get an Ethics/Compliance Committee Chartered4. Put in place a “Code of Conduct”5. Get a Helpline Set Up6. Communicate to Managers/Employees7. Do Some Training - E-Mail,Web,Video, 8. Attend Other Meetings or Training Sessions9. Give Leaders Ethics Messages to Send Out 10. Use the Company Website Extensively11. Follow in the Wake of Critical Events12. Regularly Report on Numbers, Issues to Mgt.

Every Company is UniqueLeadership

History

Culture

Policies

Practices

People

Regulatory Environment

Gallup Organization Findings Tone at the Top

VALUES

One of the Seven Demands of Leadership

GOBEC www.omahaethics.org

Gallup Research Based Findings

During nearly forty years of research and tens of thousands of interviews, Gallup

has determined the Seven Demands of Leadership.

These are behaviors of individuals who are perceived as leaders within their

organizations, communities and nations.


WHAT GREAT LEADERS DO MOST- the most commonly expressed demands

Gallup Organization

VISIONING

MENTORING

CHALLENGING EXPERIENCES

KNOWING SELF

MAKING SENSE OF EXPERIENCES

STABILIZING VALUES

BUILD A CONSTITUENCY

7DEMANDS


Allocation of TimeFor Creating Alignment

Gallup Organization

Typical

Drafting & RedraftingStatements

IdentifyingCore Values

CreatingAlignment

Desired

IdentifyingCore Values

CreatingAlignment

Drafting & RedraftingStatement

s

0-5% 90-100% 0-5%

0-5%10-20% 80-90%

Organization and Personnel


How to Manage Organizational Ethics?

1. Create a formal program w/resources

2. Put someone in charge of it• General Counsel• HR director• Internal auditor


Report to…

• CEO

• Board of Directors

• Committee of the Board of Directors

• Senior Executive


Support for Managing Organizational Ethics Programs

Ethics and Compliance Officer Association http://www.theecoa.org/

http://www.theecoa.org/

Compliance and Ethics Program

Compliance with Laws

Ethical Behavior

SWEET SWEET SPOTSPOT


BCBSNE Compliance Organization

Board of Directors

Audit & Compliance Committee

Corporate Compliance Officer (VP Level)

Compliance Department (with dedicated Staff)

Compliance Cross Functional Team Members


Responsibilities1. Provide Guidance and Answer Questions

Create and Assist in Creating Policy & Procedure

Develop and Deliver Training

Foster Awareness & Encourage Ethical Behaviors

2. Respond to Auditors and Regulators

3. Respond to Complaints (Receive/Investigate/Document/Resolve)

4. Liaison with the Board of Directors

Listen

Report

5. Keep Current on and Facilitate Compliance with Laws and Regulations

Communication & Training

Getting the right message out


What is communicated?Ethics Materials: Mission

ValuesCode of conduct/ethicsPoliciesDecision methodsYour culture

Ethics program: Who is the Ethics Officer? How to make contact?

Senior Management Commitment to Ethics:

Why organizational ethics matters?


Methods of Communication

Evaluate current ethics communication lines– Formal and informal– downward, upward, and two way

Clear, consistent, credible messages across communication lines


More about Methods of Communication

Hiring Announcements Website Email Brochures Meetings – Formal & Informal Orientation sessions Newsletters Manuals Code Handbooks w/certifications Badges and Wallet Cards Key Fobs


Ethics Training

Design for individual groups

Groups:– new recruits – existing employees– top management– local management


Ethics Training

Live

Computer based

Trainers

Certification

Helplines/Hotlines

Getting Started, Outsourcing, Case Management, Operational Flow,

Processes, and more

Factors and Features


Introduction• What – is a helpline/hotline and what do you need to do

to establish one?

• Why – set up a helpline/hotline?

• Who – should answer the line?

• How – does a helpline/hotline work?

• When – can you expect to fully implement a helpline/hotline?

• Free Advice –vendor selection, positioning, themes, questions


What…. A Helpline/Hotline Is and Some Alternative Reporting

Mechanisms

• Helpline…. a confidential toll-free telephone number for employees or others to report suspected violations of law or company policy and to answer policy questions

• Hotline – focuses on the reporting of suspected violations and emergencies

• Consider departmental needs/requirements (Safety, EEO, Audit, Environmental, HR)

• Evolution of reporting channels– From post office boxes– To confidential faxes– To voice mailboxes– To confidential e-mails– To web-based reporting systems


What …. You Need to Establish a Helpline

• Senior Management Support and some Money

• Understandable Guidelines for using the Helpline that Reflect your Organizational Values and Policies

• Multi-function support (Communications, HR, IT, Law, EEO, Operating, Audit, etc.)

• Designated Support Personnel

• Accountability and follow-up

• Communications and Employee Awareness


Union Pacific’s Values Line

• Established in 1994 and is outsourced (third-party service)

• Covers 55,000 employees

• Is a “business conduct” report line

• Does not primarily support Safety, Emergencies, Environmental, Payroll or HR services (internal lines)

• Supports EEO, Audit, Policy and Employee Relations reporting


Why….Set up a Helpline or Hotline?

• Understand the objectives

• Increased emphasis on organizational ethics and compliance– carrot and stick incentives

• Establish formal monitoring, auditing and reporting systems

• Provide anonymous channel for reporting suspected violations (which may otherwise be unreported)

• Raise awareness of commitment to ethical conduct

• Establish a proven, effective tool for protecting company


Why… Set up a Helpline or Hotline? Legal and Regulatory Requirements

• Federal Sentencing guidelines – One of seven steps in an effective ethics and compliance program

• SEC implementing rules

• New York Stock Exchange proposed listing requirements

• Sarbanes-Oxley Act (enacted 2002)– Sections 301 and 806


Who …. should answer the line?Decision Process

• External– 24/7/365

– Anonymity

– Multilingual

– Perceived confidentiality

– Vendor Features

• Internal– Staffing/budget– Time constraints– Employee trust– Knowledge of Policies– Translation services?– Training/Turnover– Software


Who?….Analyzing Vendors• Vendor Selection Process

– Talk with people who have lines

– Visit Vendor Websites

– Review intake process/procedures

– Request proposals, review best practices

– Include your IT department

– Perhaps absorb existing call system(s)

– Consider hidden costs, extra reporting


How…. Does a report line work?

- Call is placed to the UP Values Linedesignated toll-free number (800-998-2000) OR shared toll-free number

– Helpline personnel records information according to general protocol or your specific design (EEO, FMLA, etc.)

– Classifications, information, key issues

– Case is reported to you and/or others via e-mail or web links

– Case management data is summarized each month or through ad hoc reports


Operational Key Points

• Spread Out the Work• Expect 1-2% of Employees to call/yr• Who Calls the Line?• Types of Calls, Categories• Anonymous versus Identified (20/80)• Sufficient Investigation Resources• No Retaliation for good faith reporting• Confidentiality to extent possible• Follow up is essential


Types of Values Line Reports Jan. 1 - Aug. 31, 2006

Discrim./Harass.3%

Policy11%

Smoking1%

Union/CMS/Discipline6%

Safety4%

Pay4%

Other1%

Theft & Drugs1%

Job Perf./Fitness0%

Threats/violence3%

Supervision/Relations66%

Supervision/Relations

Discrim./Harass.

Policy

Smoking

Union/CMS/Discipline

Safety

Pay

Theft & Drugs

Threats/violence

Job Perf./Fitness

Other

Butch Ethington Ombudsman 402-544-2113

595


Questions?

• Cost – $1,500 to $30,000+ per year + your time

• Reports – see handouts

• Vendors – The Network, EthicsPoint, Lighthouse,– Allegiance, and many more.

– See handouts of hotline best practices

• Helping to maintain a culture of integrity

EnforcementEnsuring Observance

Putting into practice

Making it happen


Enforcement

• Reality: Codes and rules without enforcement and adherence are useless.

• Question: How do we ensure compliance with legal rules and corporate policies?


Why should you enforce?

You have Two Choices:

• Corporate Enforcement

• Government Enforcement

• The best enforcement is self-enforcement!

• Better your company do it than the EEO, SEC, IRS, court, etc.


Types of EnforcementThe best policy is to prevent wrongdoing

1. Getting Compliance (preventative)• Training and Education (‘I didn’t know’)• Review: Audit for compliance and quality • Incentives: compensation and recognition • Model: Leadership talks, and walks the talk

2. Punishment (responsive)• Clear Sanctions in place• Ethics Committee (method in place)• Someone with oversight responsibility


Implementing Enforcement

• Consistency is Important across Firm– Cross-check from HR for termination issues

• Codified Policy is helpful

• Yet, Flexibility is important also

• Realize Firing is sometimes correct action for sake of firm.

• Unions usually have process/expectations


Correcting Problems

• Sentencing Guidelines also require that you have a method of remedying ethical problem areas in your corporate culture

• Examples:– Ethics committees– Ombudsman– Ethics Officer– Stated Corporate Policy On Correction Procedure

The Seven Sentencing Guidelines

1. Having Standards

2. Assigned Responsibility - Adequate Resources

3. Due diligence in Hiring

4. Communications and Training

5. Monitoring, Auditing, Reporting

6. Promotion and Enforcement of Ethical Conduct

7. Reasonable Steps to Prevent Misconduct


Wrap Up Discussion

implementing ethics in the workplace: creating the process (abridged version) a program of the...

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