Corporate compliance programs rise or fall depending on how much employees trust that the company will follow through on promises it makes in its policies, Code of Conduct, and ethical values.
Above all, compliance officers need employees to have trust in the investigations process. Or, to flip that sentence around: employees need to trust that when they bring a concern to the company’s attention, that issue will be investigated promptly, objectively, and fairly.
When employees trust the investigations process, they fully engage with the company’s compliance program. That, in turn, allows you to build a more responsive and effective compliance program, which can drive higher standards of corporate culture.
That’s the goal. So let’s consider how compliance officers can put the right foundations in place to achieve.
Why Is Trust So Important?
It’s easy to say that employees should be able to trust the compliance program. Less clear, however, is what “trust the compliance program” means in practice for the compliance officer and other senior executives — but if you want a strong, successful corporate culture, understanding those implications is crucial.
The truth is that while compliance officers constantly say they want their employees to embrace a speak-up culture, employees already do speak about misconduct and other issues they see. They just don’t necessarily speak upward, to senior management. Why not? Because, as many studies have demonstrated over the years, employees fear that their internal reports will either (1) be ignored; or (2) bring retaliation down on their heads. (Most recently, a study from research firm Gartner found that only 38 percent of employees trust that internal reports they file will be treated fairly and transparently.)
In other words, employees don’t trust that their reports will be taken seriously. The problem isn’t that employees don’t embrace a speak-up culture; it’s a lack of trust that management embraces a listen-up culture.
So when compliance officers talk about building trust and boosting employee engagement, they really need to be thinking about how to demonstrate a listen-up culture. Only from that starting point can you then devise practices and goals for your compliance program that truly support more employee engagement.
Ultimately, employees want to see that the company’s actions match its promises. That’s the proof they need to believe the company is serious about the ethical values in its Code of Conduct and about workplace policies against fraud, corruption, discrimination, harassment, or other forms of misconduct. They need to see actions resulting from their reports, to believe that the company listens to them.
As a practical matter, that means handling all internal reports fairly, objectively, and efficiently. It also means communicating about issues in a transparent, non-threatening way.
If your investigations and case management process can’t achieve those things, employees won’t trust it — and any hopes you have for employee engagement will fly away.
How to Make Investigations ‘Engaging’
Compliance officers who want to make their investigations process more trustworthy, so that employees will engage with it and bring matters to your attention more often, can take several practical steps.
Start with an easy internal reporting process. Internal reports are the raw material that investigation and case management systems consume; the more internal reports you receive, the more this means employees want to bring matters to management’s attention. That is a good thing, and one that correlates to better business performance.
So before you look at your case management efforts, start with your internal reporting system. Is it easily accessible to employees? Does it exist in various formats, to match the communication methods they use? Do you train employees on what issues they should report, and why internal reporting is welcome?
Appreciate the power of marketing. Employees are the compliance officer’s customer base — and like any customer base, they have competing demands for their attention, including unethical or corrupt actors who don’t want them to report. Compliance officers need to combat those competing pressures with de facto marketing campaigns.
Those efforts can include strategically placed advertisements (posters in the breakroom, emails from the compliance team); market research (surveys on how much faith employees have in investigations); and even “celebrity endorsements” such as messages from the CEO or the board about the importance of ethical behavior and trust.
Explain how investigations typically work. People rarely trust what they don’t understand. The more transparent you are about the basics of an investigation and what employees should expect, the more employees will trust the process. Consider short videos explaining investigations, or hypothetical case studies, or other vehicles to illuminate the process.
Present data and show how investigations make a difference. Remember that employees often decline to report misconduct because they assume nothing will happen — so, as much as possible, disprove that notion with evidence that investigations led to change in corporate behavior.
For example, consider disclosing vignettes about specific incidents: “We received a report of kickbacks offered to managers by certain vendors, and thanks to that tip we ended that abuse.” Or talk about how internal reports led to broader change: “We received lots of reports about harassment last year, and as a result we’ve implemented new training for managers and now interview more candidates for possible promotions.”
What a Strong Investigations Process Should Do
In addition to the above suggestions, compliance officers can also take several other steps to build an effective investigations function. After all, without an investigation function that actually works — one that efficiently and reliably leads to clear results — employees (including your board and management team!) will never have much trust that the company is acting in good faith.
The investigation process should be structured, but also flexible. Your investigation or case management system should have pre-existing routines for how a case is investigated, and those routines should be tied to your biggest legal, financial, operational, and compliance risks. At the same time, however, those procedures should also be flexible enough to allow investigators to follow new evidence or facts as those things arise.
Stress objectivity and collection of evidence. Investigations should follow designated procedures to assure that issues are explored objectively and that the company gathers sufficient evidence for whatever conclusion it reaches. Your case management system should be designed with those points in mind: to guide investigators clearly and to be repositories for evidence, so that management can make better decisions.
For each case, communicate with the reporter. Even updates as simple as, “We are still investigating,” or “This has resulted in discipline against certain offenders, but we can’t say more” will show internal reporters that the company values the role they play. Communicating to the reporter helps them feel heard — and that’s the listen-up culture that builds trust.
Conclusion
Employee engagement is critical for success in the modern business world. Just consider the converse: a disengaged, distrustful workforce, that couldn’t care less to alert the company as wrongdoers leave the organization exposed to all manner of legal liability, compliance infractions, or reputation harm. No management team wants that.
Simply put, the business case for building more employee engagement and trust is clear and compelling. The challenge for compliance officers is to develop the specifics of that effort — and a strong, effective case management system will be a crucial part of it.
When your investigations function offers clarity, efficiency, and transparency, employees will feel more comfortable taking that leap of trust. The benefits that come afterward will be felt across the whole enterprise.
Matt Kelly is an independent compliance consultant and the founder of Radical Compliance, which offers consulting and commentary on corporate compliance, audit, governance, and risk management. Radical Compliance also hosts Matt’s personal blog, where he discusses compliance and governance issues, and the Compliance Jobs Report, covering industry moves and news. Kelly was formerly the editor of Compliance Week. from 2006 to 2015. He was recognized as a "Rising Star of Corporate Governance" by the Millstein Center in 2008 and was listed among Ethisphere’s "Most Influential in Business Ethics" in 2011 (no. 91) and 2013 (no. 77). He resides in Boston, Mass.