Building an Effective Compliance and Ethics Program: Open Lines of Communication

Analiese Fusner

A culture that fosters open and honest communication is one that proactively and promptly identifies and responds to issues. In the process, it also mitigates risks. The Federal Sentencing Guidelines (FSG) for Effective Compliance and Ethics states: “The organization shall take reasonable steps to have and publicize a system, which may include mechanisms that allow for anonymity or confidentiality, whereby the organization’s employees and agents may report or seek guidance regarding potential or actual criminal conduct without fear of retaliation.” Providing a safe and professional environment for employees to report possible violations of law and wrongdoings is crucial to having an effective compliance and ethics program.

In order to understand how to create an environment where reporting concerns is second nature, we need to visit some of the top reasons employees do not report issues:

Fear of retaliation
Belief that nothing will be done

How do you know if your employees feel the lines of communication are open? Asking them is a great place to begin: spend time with employees and ask how they are doing. Or, conduct a survey. Obviously, results of surveys need to be studied in order to focus on the right things.

Other areas to consider when evaluating your culture are as follows:

Do you have a policy regarding how to report and where to report?
Do you have a non-retaliation policy?

The non-retaliation policy should be clearly documented and communicated to employees. Few things will destroy a compliance program more than if employees feel they will be punished in some way for reporting problems or asking for guidance. Remember, employees may not remember what exactly was said, but they will remember how you make them feel. Keep in mind, employees may be reporting on themselves for an inadvertent error. If employees feel good about working through the little issues, they are that much more encouraged to report serious matters.

Have the employees been trained on these policies?
Are the policies effective? Understandable? Accessible?
Do you have an ethics reporting hotline so employees can report anonymously?
Is the reporting hotline promoted and managed?
Do you have campaigns and slogans that provide tips and techniques as reminders to report concerns?
What about your company’s meeting norms? Do they include standing agenda items such as soliciting feedback for areas of risks/concerns?
Make transparency comfortable and not controversial – employees should feel safe
Reward compliant and ethical behavior publicly
Most importantly, do not assume silence means there are no problems

Compliance programs operate most effectively in organizations that encourage employees to report concerns, which can be investigated and properly addressed. By fostering long-term, trusted relationships with your employees, you are inherently cultivating a culture that is open and honest in its communications and dealings, which is at the very heart of an effective compliance program.

This post is part of a series of articles that started in 2013. You can review earlier posts on building an effective compliance and ethics program here. If you are seeking a full comprehensive guideline, click here to review a comprehensive overview, “Building a Transformational Compliance Program.”