What To Consider When Planning, Developing And Implementing An Enterprisewide Business Ethics Training Program

Transcription

1 What To Consider When Planning, Developing And Implementing An Enterprisewide Business Ethics Training Program Iain McLeod is Head of Compliance (EMEA) at SAI Global, an international business that helps organizations implement effective compliance and business ethics training and awareness solutions. In this whitepaper he reflects on recent experiences in the business ethics field and considers some best practices to consider when planning, developing and implementing an enterprise-wide employee awareness program. Recent surveys in the USA, Canada and the UK have revealed a major disconnect in business ethics training. For example, in a survey by the London based Institute of Business Ethics, 179 of the larger UK companies (known to have ethics programs e.g. a code of business ethics) were asked why having a corporate code of conduct was important to them. The prime motivation was that of giving guidance to staff on how to respond to ethical dilemmas, however, ironically, the survey also concluded that 59% of companies did not offer any training to members of staff on the meaning and use of their corporate codes of conduct. So, while organizations are increasingly recognizing that business ethics has an important role to play, they are failing to communicate this to staff. And how can staff possibly be expected to make the right decision on ethical issues, if they have little or no guidance from the company itself? These findings were echoed by surveys conducted by the US-based Ethics & Compliance Officers Association (ECOA) where the gap is perceived to be even wider. Past experience in working with organizations worldwide has proved that most companies and government agencies are genuinely concerned about ethics and want to make it a high priority. Unfortunately though, the mindset of many organizations is that creating a corporate code of conduct (which is an undertaking in itself) and publishing a version of it (i.e. printed booklets / or via the intranet) is a job well done. Many also have audit and certification procedures, but their failure has been to recognize that they need to gain employee buy-in to ethics, and that this requires a much more imaginative and proactive training approach. If an organization is serious about making an impact with corporate codes of conduct, they must ensure that all staff: Understand why ethics is important Are aware of their own responsibilities for ethics Feel capable to make decisions on basic ethical dilemmas Know who to refer to for advice on ethical issues. 1

2 But how do you communicate ethics in a coherent way, and avoid overload on the one hand and lip service on the other? And in a time of budget squeeze and tough competitive environments, what is the best way to get the ethical message to stick? Issues to Consider when Embarking on the Development of an Ethical Training Program Over the past two years, with the advent of corporate scandals and substantive new legislation targeted on governance, the intensity of activity has increased enormously. What have been the key lessons from the field in this area? The human element. This is the most important and by far the most neglected factor in corporate codes of conduct management. The first step is accepting that good ethics is good business, and that reputation management can be a source of real difference in a competitive market. The real challenge though is getting these messages across in a way that is truly effective and makes them stick, but at the same time delivers rigorous adherence. Anecdotal evidence reveals that this area remains the last agenda item and rarely considered in the development of rules, policies and procedure. Issues are often dealt with in pieces. They are either subject driven (whistleblowing, conflicts of interest, abuse, privacy, health & safety, and so on) or owned by divisions and business units who perceive they have different issues and priorities. The uneven treadmill of legislation has also not helped. For employees, this often creates internal communication overload with competing demands for time and attention. There is a profound lack of clarity about expectations and priorities. There is considerable confusion between information and understanding. Compliance professionals and legal departments generate substantive policies and procedures, as they must, but for the majority of employees the issue is simple: they need the answer to three basic questions what is it, why is it important and how does it apply to me? We have seen numerous cases of policy and procedure monsters that overwhelm employees and can result in, at best, confusion and, at worst, business paralysis. Generally less is more. After all, it is not necessary for everyone to become experts but they do need to know the key principles and be able to recognize when they need help or are required to report or refer. Diverse training approaches and methods contribute to a lack of unified and effective compliance programs. Combinations of offline, online and other forms of training are desirable but these need to be managed in context and as a whole. Often, important subjects are treated to superficial approaches or alternatively lengthy classroom monologues unrelated to roles or responsibilities. Training needs to be consistent with policy, procedure and culture. Rollout needs to be managed, and time and effort should be related to the importance of the subject. Too often, courses are delivered with a fire and forget mentality, without being positioned or explained to users and without consistent follow up. 2

3 Below par internal coordination on training and awareness is endemic. Large-scale organizations have a widely distributed workforce. Business ethics training requires cohesive internal coordination between various departments and business lines. As a result, there must be visible emphasis on good internal project management. The field experience is not encouraging; neither vendors nor organizations have been consistent in this area. Managing exposure and training on an international basis is a major worry. For global or even regional organizations, business ethics oversight can be a patchwork quilt. Vulnerabilities have a tendency to increase away from the center, and stand-alone offices and specialist subsidiaries may need quite particular approaches. Compliance standards can vary enormously and policies need to be integrated and matched to local needs while maintaining minimum standards. Vendors that have true international capability are not easy to find. Technology is seen as an obstacle to be overcome not as an aid to education and awareness. Only rarely do large organizations have consistent and current technology environments. Browsers, desktop builds, server environments and bandwidth all vary enormously. As a result, many online training initiatives flounder or deliver less than comprehensive coverage because of failures to coordinate technology with training. Poor courseware, canned offerings and uneven implementation have hindered effective employee awareness and education. The number of vendors offering online training is now considerable. On the other hand, good courseware needs to combine skillful instructional and graphic design. Many courses are little more than polished clip art plus PowerPoint formats. Canned offerings may work, but these rarely combine with business needs and cannot always accommodate different audiences. The business case for truly effective training and awareness is often poorly articulated. This is partly because immediate metrics are not usually available, or are highly subjective, and thought is often required to develop them. The ROI on online training versus offline is clear, but the value of training in itself is frequently overlooked. It is an easy budget line to cut! Measurement of awareness and understanding is vital. Even before embarking on the development of a training program, carrying out an awareness audit can provide important indicators on the knowledge gaps that exist. More importantly, it is crucial to test awareness and understanding, post-training, to ensure that knowledge gaps have been filled effectively. Most online training solutions provide an audit / tracking system, or a Learning Management System (LMS) that will automatically track participation and understanding. These records can help to pinpoint risk areas, and could also help mitigate any potential fines or penalties imposed if charges are filed against your organization for non-compliance with external regulations. A word of caution though look beyond the glossy vendor brochures. Many Learning Management Systems fail the test of utility and have limited ability to manage different types of courseware. 3

4 10 Key Principles Despite this, many organizations have produced very effective and elegant solutions. The best examples have combined on and offline techniques, have been positioned and managed within an overall internal communication context and have been skillfully managed to handle the needs of different audiences, business lines and jurisdictions. Two case studies are included at the end of this paper. Here are 10 key principles for making business ethics training and awareness truly effective: 1. Clarity of ownership & executive buy-in clear and visible executive buy-in lends credibility and avoids gaps between words and actions what may be termed the Enron principle. Within the organization, there should be clear and unequivocal ownership of the project to ensure that it meets organizational objectives, but can accommodate the needs of different business lines. 2. Integrated compliance getting each business line or policy area to create its own solution may be a way forward but for the most consistent, cost effective and comprehensive solution, an enterprise-wide approach generally yields the optimum outcome. 3. It is about understanding, not information; less is always more we do not all have to be experts in Sarbanes-Oxley, the Federal Sentencing Guidelines or the Gramm-Leach-Bliley Act. Sensible, relevant and clear information to deliver clarity of understanding is what is required. Reference material is fine but keep it to be used only when needed. If any training is much more than 45 minutes to an hour long, you should be asking some very hard questions about its effectiveness. Studies show user retention and commitment plummets after more than 60 minutes on screen. 4. Value, not cost a canned solution may be the answer; a swift PowerPoint presentation may be less expensive, but bear in mind that costs relate to scale (generally the more users there are, the lower the cost per head) and that the real measure is the effectiveness of the outcome. Fines for regulatory breaches have never been higher, to say nothing of the real cost of an impaired business reputation. Beware when there is excessive focus on cost rather than benefit or applicability. 5. The right combination of spirit and structure don t bore users into submission. Engaging and memorable content is critical. Reinforce personal responsibility, the corporate commitment to making this happen and getting it right. 6. Relevant context setting nothing turns employees off more quickly than irrelevant, inappropriate or unrealistic case studies and contexts. Actual examples or situations are best. Training needs employee buy-in and an understanding of how it fits into their daily routines and provides guidance on future behavior. 7. Continuous process once-a-year training or one-offs generally do not work. Reinforcement, updates, campaigns are all part of the mix. Senior executives and regulators usually expect to see annual statistics but making it stick requires a continuing effort. 8. Consistency make sure messages are consistent and that the way training and awareness is delivered runs with the grain of organizational culture and style. 4

5 9. Technology should enable training should work within the context of what is possible within your organization and what will most benefit, and not frustrate, the learner. It is the content that makes the difference; IT needs to be involved but always consider the art of the possible. A good partner will always have plenty of solutions and fixes for working around technology glitches. 10. Project management, project management, project management above all else the key ingredient and the real reason why most implementations fail. Ensure both you and your chosen partner have good project management capabilities, and ensure all parties are on board. Before starting anything you should have clear internal ownership and accountability. As a minimum insist on a detailed and comprehensive training needs analysis. SAI Global has implemented numerous solutions in Europe, the U.S., Australia and around the world. Here are two abbreviated case studies. To learn more or to discuss your own training and awareness plans, please contact SAI Global directly. Creating an Innovative Web-based Business Ethics / Code of Conduct Program for a Leading Global Spirits Company. This program, created in both English and Spanish, covered general themes as well as specific topics relating to the client s business, including fraud, conflicts of interest, insider trading, brand protection, and health and safety. The style and design of the program had to accommodate a strong existing brand image. The technical connection challenge was to integrate within the client s existing AICC compliant Learning and Content Management System. Graphics picked up themes and images from the corporate marketing and branding side of the business to create a good fit and reinforce corporate values as well as strategic positioning. The aim of the learning content was not only to raise awareness of the client s Code of Business Conduct among employees, but also to bridge the gap between the policies themselves and their practical application on a day-to-day basis. To this end, the focus of the program was on the use of realistic case studies and scenarios to illustrate how the policies should be applied. The Outcome: The launch of the program was highly successful. The resulting feedback has generated strong internal debate with a direct feed to enhancing procedures, policies and standards. This has raised the whole profile of integrity issues and helped improve overall compliance as well as employee buy-in. 5

6 Creating a Global Web-based Code of Conduct Awareness Program for a US Client Operating in more than 100 Countries. Consulting closely with subject matter experts from within the business, and using a combination of text, graphics, animation and streaming audio, SAI Global created a comprehensive e-learning program made up of scenario-based modules that used actual case studies of ethically challenging situations. Students were able to develop a practical understanding of each policy area by identifying good and bad practice within each scenario with feedback provided. The complete program comprised of 13 modules with a total learning time of between 90 and 180 minutes. The course has been converted to a number of languages. The program was delivered via the corporate intranet to over 250,000 users globally, and was fully integrated with a customized corporate LMS. The business had numerous divisions operating in very different business environments. Selection of case studies and scenarios required particular care. The Outcome: The first global project of its kind in this area, the program has affected every level of the organization, as well as helping launch a new Code of Conduct. The course has raised levels of debate and awareness within the organization, helping to highlight the critical importance of reputation management. SAI Global SAI Global is one of the world s leading business publishing, compliance, training and assurance organizations with operations in North America, Europe and Asia Pacific. The Compliance Division of SAI Global works with organizations worldwide helping to build a culture of compliance. Using our international experience, we deliver effective solutions to help manage risk, achieve compliance and promote ethical behaviour. We offer a flexible range of risk and compliance solutions and services, which engage staff at all levels of an organization. Europe, Middle East and Africa 42 The Square, Kenilworth, Warwickshire CV8 1EB, UK Tel: +44 (0) , Fax: +44 (0) info.emea@saiglobal.com Asia Pacific Normanby Road, Southbank, Melbourne, VIC 3006, Australia, Tel: , Fax: info.asiapac@saiglobal.com Americas 101 Morgan Lane, Suite 301, Plainsboro, NJ, 08536, USA Tel: SAIG (7244), Fax: info.americas@saiglobal.com 6