Creating a Speak-Up Culture

An important gauge of the success of any company's compliance training and communications program is whether the company's efforts have created an environment where employees readily raise questions and concerns about the way the company is conducting business.

Since the passage of the Sarbanes-Oxley Act in 2002, much has been written about the different avenues companies should take to ensure that potential problems are being escalated internally. With the passage of the Dodd-Frank Act in 2010 and its whistleblower bounty provisions, working to ensure that employees are escalating issues internally has become more important than ever before.

We live in a complex world with many laws and regulations that can complicate the job of compliance officers. Finding ways to encourage a “speak up” culture, however, is an exercise that should be relatively easy, provided companies are willing to devote the time and effort needed to create such a culture, and that companies have the intestinal fortitude to make difficult, but necessary decisions.

Creating a speak-up culture begins with ensuring that your company has the correct tone at the top. The commitment to foster an environment where employees feel comfortable escalating concerns must begin with a company's board of directors and executive management. From there, it cascades down through the organization. Furthermore, having the correct tone must manifest itself in visible ways, well beyond the words in a code of conduct or other company documents or policies. Executives and senior managers must take the time to remind employees of the methods available to them for raising concerns, encourage them to speak up, and react appropriately and professionally when concerns are raised.

Companies must also ensure that they are providing multiple avenues for employees to voice their concerns. At CA Technologies, for example, we point employees to a number of different resources, including: direct managers, the human resources and legal departments, the company's business practices and compliance team, and a confidential telephone helpline and Webline. Other companies may rely on an ombudsperson or have compliance councils as added resources for employees with compliance-related issues. The important point is to ensure employees have multiple places to turn when they have questions or concerns.

Once the tone-at-the-top is correct and the avenues for issue escalation have been established, companies must spend time and energy effectively promoting these as well as the company's expectation that employees raise issues and questions whenever they have concerns about the way the company is operating. This can be accomplished through a variety of internal channels, including posters, Web campaigns, newsletters, blogs, speeches, meetings, informal water cooler talks, e-mail, and employee focus groups.

At CA Technologies, for example, workplace posters advertising our helpline and Webline can be found in every office around the world. These posters are updated every few years with a new look and supporting awareness campaign. The company also advertises avenues of escalation through a quarterly compliance newsletter and highlights these avenues in all of its mandatory compliance training courses and in its annual code of conduct attestation and conflict of interest disclosure. Business leaders also advertise these avenues of escalation on a regular basis in team meetings, e-mail communications, and in broader, companywide meetings. The point is to continually find new ways to convey this information to keep these escalation avenues and the company's expectations on the minds of employees.  

Barring Retaliation

For marketing to be effective, it must clearly convey the company's prohibition of retaliation against anyone who raises good-faith concerns about the company's business practices. Compliance professionals well understand concerns about retaliation. Many surveys confirm that one of the main reasons employees don't escalate concerns is fear of retaliation. Employees would often rather lay low than report an issue, with the hope that someone else will report the problem.

Reminding employees about the company's prohibition of retaliation is a good first step, but it is not the only step. A far more important step is ensuring that if retaliation rears its ugly head, the company reacts swiftly, harshly, and in a very transparent way to address the situation.

Allowing toxic employees to remain in your organization will seriously compromise your ability to create a speak-up culture because employees who exhibit these behaviors provoke fear in others, and fear is the main reason employees don't speak up when they have concerns.

A compliance program that does not immediately address concerns about retaliation is doomed to fail. While many lawyers eschew the practice of “public hangings” out of litigation concerns, companies should carefully consider this issue. Is the threat of a single lawsuit more important than the underlying credibility of your global compliance program? If you've done a thorough investigation and are comfortable that you have strong evidence to support your conclusions that an employee acted in a retaliatory manner, isn't this a fight that is worth having?  Isn't it important to point to real-life examples to illustrate to employees that you mean what you say when it comes to prohibiting retaliation? While different companies may answer these questions differently, it is our job as compliance professionals to ensure that these questions are being asked and debated so the best possible decisions are being made for the long-term success of the company and health of the compliance program.

Employees who do not live the company's values are often well-known within the company. Unfortunately, companies are not always as vigilant as they should be in addressing these employees until after something has gone wrong. Good business leaders understand the damage that these types of employees can inflict upon a company and its culture. In fact, some have gone so far as to espouse a rule about the type of people they will not allow on their teams.  Jim Kilts, the former CEO of Gillette, for example, very simply referred to this philosophy as the “no jerk” rule. In his view, no matter how talented an employee may be, he understood that a bad employee's actions could create a toxic environment that would otherwise undermine the things the company was trying to accomplish. Kilts believed that he could find someone equally talented who would succeed in the job while espousing the company's values.

Several years ago, Stanford Business School Professor Bob Sutton wrote an essay titled, “The No Asshole Rule: Building a Civilized Workplace and Surviving One that Isn't.” In his essay, Sutton profiled the types of employees who are problems and who do things that undercut the company's efforts to promote a speak-up culture. Sutton identified tactics used by problem employees, including: humiliation, belittlement, bullying, threats, intimidation, and treating others like they are invisible.

Allowing toxic employees to remain in your organization will seriously compromise your ability to create a speak-up culture because employees who exhibit these behaviors provoke fear in others, and fear is the main reason employees don't speak up when they have concerns. When there is smoke in your organization, how quickly do you move to put out the fire? As compliance professionals working to create effective speak-up cultures, it is our job to ensure that management is addressing problem employees before they create compliance issues or otherwise undermine the company's efforts in creating a speak-up environment. We should also be training our managers and leaders on the right and wrong way to react when someone voices a concern to them or even files a formal complaint against them.

Like many other large companies, CA Technologies conducts employee surveys several times each year and includes questions about the quality of our internal corporate culture, as well as the overall effectiveness of management.  The feedback is thoroughly analyzed and changes are made in response to the feedback we get from employees via these surveys, including removing employees who are not living the company's values. If an organization gathers this type of data and does nothing with it, it misses an opportunity to address obstacles to creating a robust speak-up culture.

In some respects, the speak-up culture is the Holy Grail of compliance. If you've successfully created this type of culture in your company, it means you have won the trust and confidence of your employees; they have bought into the company's values and understand the value of compliance; you are learning about issues in real time and you are being given the opportunity to address issues and problems yourself, without any “friendly” government assistance.

Creating a speak-up culture is not easy, but taking the time and devoting the resources necessary to do so is an investment that will pay huge dividends for your company.