In the July-August issue of the Harvard
Business Review, in an article entitled "Are You a
Collaborative Leader", authors Herminia Ibarra and Morten Hansen
discuss how great Chief Executive Officers (CEOs) keep their teams connected.
The authors' basic thesis is that the hyper-connected business world of today
demands a leadership style which harnesses the power of connections. I found
that the article had some excellent suggestions for the compliance practitioner
regarding communication with employees outside the Compliance Department and
indeed throughout the world. The authors had five general points which I
believe, if incorporated into your overall compliance program, will strengthen
it by increasing communication and cooperation with the compliance department.
I. Play Global Connector
My colleague, Mary Jones, often talks about her
experiences in going out across the globe to perform training. This experience
also has the great benefit of allowing her to meet the business development
people in the field, to put a name with a face and talk privately with persons
away from the dreaded 'home office'. The authors state this type of person as a
"connector" who gets out in the field makes themself personally known.
Connectors want to find out what people think and why they think that way.
Sitting in the home office and waiting for the phone to ring is not always the
best way to determine this. You have to get out in the field to gain
credibility but to also be known as the person in the compliance department
that someone in the Far East (or Middle East or Central Asia-name your
location) can call anytime with an issue.
II. Engage People at the Periphery
As much as companies try to make all employees conform to
one compliance program across the world, it is simply not possible to do so.
This does not mean that bribery and corruption is acceptable in some places but
not in the US (or the dreaded 'it's just the way business is done here'
syndrome). Customs and relations are different across the globe. There needs to
be some cultural sensitivity. As a compliance officer you can be firm about
upholding your overall compliance goals but do it in a much more sensitive
manner than simply saying that is the policy and you had better follow it. I
once heard a Chief Compliance Officer (CCO) answer a question about how he
explained to an Vietnamese employee about how corruption in his country hurt
everyone and the company's compliance policy was one way in which the employee
could 'move the ball forward' regarding bribery and corruption.
III. Leadership at the Top
The authors define this as "depoliticizing senior
management so that executives are rewarded for collaborating rather promoting
their individual agenda." The clear reason this is important is that in the
area of compliance, as with all other areas, tone at the top is critical. If
compliance is seen as valued at the top, it will cascade down. Every compliance
officer knows that without the support of top management, a compliance program
is doomed to failure. This also means that the goals of compliance need to be incorporated
into overall leadership goals. If goals are simply performance based, employees
will understand that is what the company values. In other words if senior
management only talks the compliance talk but grades everyone on quarterly
perform, guess what employees will understand is important.
IV. Show a Strong Hand
This translates into allowing employees across the
organization to make first-line compliance decisions, after appropriate
training. While a company can centralize all compliance functions in the US
home office (remember the dreaded'home office' scenario); if the compliance
department can get out into the field and train, it will make the organization
more agile in compliance. Compliance leadership should assign clear rights and
responsibilities to employee sponsors or advocates but allow them to do their
jobs without watching over them or second guessing every decision. The point of
decentralizing is to do just that but do not require that every decision be
committed to death or agonized over. There is plenty of time for that with much
bigger compliance decisions.
V. Loosening Control without Loosing Control
Collaboration does not necessarily mean consensus. The
power of this model is to allow a wide range of views across different silos
within the company. As with point IV above, you can make a decision when
required, but take the company's pulse. Interconnectivity is certainly a
by-word with all international Fortune 500 companies now so take advantage of
all of the resources. Even if you cannot get out on the road or head over to
China when a question or issue arises in China, you can tap into those
resources which you have cultivated through connectivity.
Even after such a decision is made, be sure to follow-up
with your connected resources. Now is the time to get out of the home office to
visit your foreign in-country connections. This demonstrates a clear commitment
to the persons involved and also demonstrates to all the employees around them
that compliance views them as resources which the compliance department will
tap into.
The clear thesis of this article is to connect with
employees outside of your Compliance Department to assist you. If you do so,
these connections will be some of your strongest advocates to do business the
right way in your company.
Visit the FCPA Compliance and Ethics Blog,
hosted by Thomas Fox, for more commentary on FCPA compliance, indemnities and
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This publication contains general information
only and is based on the experiences and research of the author. The author is
not, by means of this publication, rendering business, legal advice, or other
professional advice or services. This publication is not a substitute for such
legal advice or services, nor should it be used as a basis for any decision or
action that may affect your business. Before making any decision or taking any
action that may affect your business, you should consult a qualified legal
advisor. The author, his affiliates, and related entities shall not be
responsible for any loss sustained by any person or entity that relies on this
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the author. The author can be reached at tfox@tfoxlaw.com.
© Thomas R. Fox, 2011
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