A thoughtful and well-drafted Code of Conduct is the cornerstone of any strong corporate compliance program. Making that cornerstone strong enough to support a compliance program worldwide, spanning all manner of cultures—that’s the tricky part.
Some companies take a values-based approach, where they lay out a set of principles in their Code as a guide that maintains flexibility for distinct local cultures. Others follow a more prescriptive approach, spelling out both the company’s core values and then delving into specific rules of law. (Highly regulated businesses may not have much choice but to adopt the latter.)
“We follow a values-based guide, the idea being that compliance is more than just about rules and regulations. It’s about doing the right thing,” says Christine Stickler, chief compliance officer for global technology giant TE Connectivity, which has more than 80,000 employees around the world.
“What people really want are examples. Broad abstract principles are not enough.”
Scott Gilbert, Chief Risk & Compliance Officer, Marsh & McLennan Cos.
TE builds its Guide to Ethical Conduct, which is translated into 20 languages, on four core values: teamwork, integrity, accountability, and innovation, Stickler says. “Being that we have employees from all around the world … we feel that having a unified system of values brings us together,” she says. “Those values are the foundation of our policies and procedures articulated in our guide.”
Newell Rubbermaid, which revamped its Code in 2011, takes a similar values-based approach. Many perceived the old Code of Conduct as too “U.S-centric,” says Robyn Farmer, chief ethics and compliance officer at Newell. Therefore one aim of the revised code was to give it global relevance, she says.
Newell came up with a set of values that it wanted to apply in every country where the company operates, Farmer says. To help make the code more relevant to its global employees, Newell incorporated interactive elements into its Code, such as real-world examples and Q&As.
Scott Gilbert, chief risk and compliance officer of Marsh & McLennan Cos., agrees that “what people really want are examples,” he says. “Broad abstract principles are not enough.”
“One thing we learned through focus groups, and through talking with people, is that they really want to see examples in the Code of the kinds of situations that are likely to present themselves, and some suggested outcomes for those situations,” Gilbert adds.
Focus groups serve as another effective way to ensure that a company’s Code of Conduct maintains global relevance. “You really need to get a sense of what people think of the Code, how they use it, what would make them use it more,” says Julie Moriarty, general manager for training and communications strategy at The Network.
Compliance and ethics officers stress that a written Code of Conduct is only one component to implementing a set of values that resonates on an enterprise-wide level. “Anything that helps bring the Code and the messages in it to life are incredibly important,” Moriarty says.
Marsh & McLennan has a training documentary, for example, that it produced itself and runs 50 minutes. The film helps give the Code global relevance, Gilbert says. Subtitled in 12 different languages, the film spotlights the daily experiences of employees in London, Santiago, Tokyo, Dubai, and New York.
Newell Rubbermaid’s Code of Conduct
Below is a summary of Newell Rubbermaid’s Code of Conduct.
THE CODE APPLIES TO ALL OF US.
Our Code is designed to provide guidance for the kinds of ethical situations you may encounter and to guide you to resources you can access when you’re not sure of the proper course of action. The Code applies to:
All employees of Newell Rubbermaid;
All members of our board of directors when acting in their capacities as directors;
Agents, representatives, independent contractors and consultants, where applicable, when conducting business with, or on behalf of, Newell Rubbermaid.
EACH OF US HAS A SET OF RESPONSIBILITIES.
We encourage all of our employees to take responsibility, to take action and to grow with integrity.
Take Responsibility: As an employee, you have a responsibility to yourself, your co-workers and our Company to conduct business legally and ethically. Make sure you read the Code and understand the rules that apply to you. If you are not clear on your responsibilities, just ask. You will be required to certify regularly that you have read and complied with our Code.
Take Action: Sometimes you can prevent misconduct just by taking action early and speaking up if you see someone about to do something questionable. If you see a co-worker about to do something which may violate the Code, try to stop it. It is always easier to avoid making a wrong decision than to respond to it after the fact. If something has already happened which may violate our Code, we need to deal with it, so let someone know. [W]e have many resources available to you. Ignoring problems only makes them worse and can damage the trust we’ve built with our stockholders, consumers, customers and with each other. When you take action, you help us address problems before they harm others or our company.
MANAGERS HAVE A GREATER RESPONSIBILITY.
Managers set the tone for an ethical workplace. If you’re a manager, we look to you to set a good example and be available to your employees when they have concerns. You have a responsibility to read and be familiar with the Code and the laws and policies that apply to your team. You also have a responsibility to listen to your employees and promote an open dialogue about ethical and compliance issues. When ethical issues are brought to your attention, we rely on you to report concerns through the appropriate channel. As a manager, you also have a duty to make sure your employees know about the Ethics Hotline and other resources available to them for speaking up about potential misconduct. You must never respond in a retaliatory manner or allow retaliation by others.
Source: Newell Rubbermaid.
Threaded throughout the film in subtle ways are specific messages about issues such as insider trading, contractual limitations of liability, and the importance of individual responsibility. The documentary is followed by guided discussions about how each issue applies to employees’ daily work activities.
In a similar vein, TE and Newell also supplement their Codes with both online and live training. “Part of the live training we do is through our Ethical Connections program,” Stickler says. “The Ethical Connections program engages managers in dialogues with their employees about ethical dilemmas.”
How that works in practice; once a quarter during a staff call, routine meetings, or a “lunch and learn,” managers will introduce a prepared scenario that sets up a hypothetical ethical dilemma, Stickler says. “The team has a chance to talk for 10 or 15 minutes about how to manage a difficult issue. The goal is to make sure our employees are empowered and well informed, so they will know how to address ethics and compliance issues and where to go for help.”
Farmer stresses that having the support of middle management is just as important (if not more important) than tone at the top. “One of our key areas of focus right now is how to better support direct line managers so that they feel more comfortable providing guidance with respect to the Code of Conduct and sharing ethical messages with employees,” she says.
Some of the ways Newell provides better context around its core messages is by incorporating “more regional messaging in the training we give to employees by using regional managers,” Farmer says. In part, that involves listening to the feedback offered by those regional managers on what unique issues and concerns they face, she says.
“We’re constantly trying to figure out better ways to deliver our message, while keeping the message consistent, taking into consideration all of those differences—cultures, legal obligations, mindsets—everywhere that we operate,” Farmer says.
Lost in Translation
Ensuring that the Code and training materials are conveyed in a way that all employees understand is a work in progress for many companies. “Translation is really an art,” Stickler says. “We always seek to get the message right, and we always encourage feedback so that, if we’re not getting it right, we can do better.”
In addition to enlisting the help of a third-party translation service, for example, both TE and Newell also have a thorough internal review process for quality purposes.
“Making sure you have a multinational, multicultural team helping with the review of the Code is incredibly important,” Moriarty says. “You want to make sure you have somebody who is reading your Code translations who understands the purpose of it and has been involved enough in the initiative to understand the tone and message you’re trying to get across.”
At Newell, the ethics and compliance team—made up of leaders who sit in the company’s Asia Pacific, Latin America, Europe, and North American offices—reviews the Code and takes a deep dive to assess, “Does this translate well? Does this make sense?” Farmer says. From there, the Code is circulated to middle managers in various parts of the world, “who are very supportive of our program and are willing to read over the messages that we are delivering,” to make adjustments as needed.
Moriarty further stressed the importance of localized training, especially when trying to reinforce behaviors that may not be understood outside the United States.
“You can’t tell employees in every part of the world, for example, ‘You’re an unethical person if you pay a bribe,’” she says. “In the United States, we can say that and get away with it, but in countries where that may be a cultural norm, you need to make sure that the language is not offensive, or that it’s so contrary to cultural norm that it just drives the behavior underground.”