The FCPA Guide states that, “In addition to evaluating the design and implementa­tion of a compliance program throughout an organization, enforcement of that program is fundamental to its effec­tiveness. A compliance program should apply from the board room to the supply room—no one should be beyond its reach. DOJ and SEC will thus consider whether, when enforcing a compliance program, a company has appropri­ate and clear disciplinary procedures, whether those proce­dures are applied reliably and promptly, and whether they are commensurate with the violation. Many companies have found that publicizing disciplinary actions internally, where appropriate under local law, can have an important deterrent effect, demonstrating that unethical and unlawful actions have swift and sure consequences.”

This means you need to have recognized incentives for doing business under your Code of Conduct and in fulfillment of your compliance policy and procedures. Incentives can be immediate (such as cash bonuses or other awards) or more long term (such as promotion within an organization). Yet, recent research has suggested that such things as a good word or two for an ethical job well-done can also go a long way toward incentivizing not only similar ethical behavior, but compliance as well.

There are some general ideas around incentive, which you can implement, as compliance incentives do not have to be extravagant or groundbreaking. Even rather plain vanilla incentives can work if you deliver it consistently, if you make the rewards visible, and make certain that your compliance incentives can be implemented on all levels within your organization.

Another important part of an incentive program is through promotion of employees up to senior management. Human resources can help compliance by working to promote only employees who demonstrate a commitment to doing business in compliance. If your company is seen to advance and only reward employees who achieve their numbers by whatever means necessary, other employees will certainly take note, and it will be understood what management evaluates, and rewards, employees upon.

I have often heard a common tale told by some regional managers: “If I violated the Code of Conduct, I may or may not get caught. If I get caught, I may or may not be disciplined. If I miss my numbers for two quarters, I will be fired.” If this is what other employees believe about how they are evaluated and the basis for promotion, you have lost the compliance battle. 

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