Ethisphere and Convercent recently collaborated to release a survey about aligning business goals with ethics and compliance programs. The report provides many insights about ethical behavior at work.
The two most interesting include the different kinds of data metrics companies are using to measure compliance program effectiveness and the role managers play in creating successful ethics and compliance programs.
Different Types of Compliance Data Metrics
“Activity” Data Versus”Performance” Data
Companies are sitting on enormous mounds of data, much of which can help”to detect and anticipate ethical issues in real time before they become a real problem.” According to the report, the most common data companies collect is:
- Training Completion Rates (78%)
- Hotline Statistics (74%)
- Investigation Statistics (70%)
- Likelihood and Severity of Top Risks (60%)
However, while important, the report calls this data more or less”activity” data, which is less valuable than”performance” data. Performance data is an”excellent measure” of ethical behavior and culture, is tracked marginally well, and comes in the form of:
- Audit Results
- Risk Assessment Results
- Third-Party Due Diligence
- Conflicts of Interest Disclosures
- Culture Surveys
Difficult to Track”Desired” Metrics
The report also identifies”desired metrics” that chief ethics and compliance officers (“CECOs”) want to track, but find doing so difficult:
- Open-Door Reporting
- Behavioral Root Cause Analysis (behavioral factors that lead to an incident, such as the effect of incentives on an unethical sales decision)
- Campaign and Engagement Effectiveness
- Ethics and Compliance Value
Additionally, even if compliance and ethics professionals have this data, they may not use it:
- 65% of CECOs struggle to aggregate and analyze data due to lack of time and resources
- 55% indicate that data are housed in disconnected and unintegrated systems
- 44% say the data simply isn’t available to them.
Apparently, many CECOs feel are not properly equipped to measure the effectiveness of their compliance programs. But one major resource CECOs have for information is their managers.
How Managers Help Ethics Programs Succeed
Managers hold a lot of power over people in an organization. According to the report, 73% of employees indicate they raise concerns primarily with their manager, their manager’s manager, or human resources.
On one hand, this is good news — the vast majority of employee survey respondents are comfortable addressing at least some issues with management (known as”Open-Door Reporting”).
On the other hand, it puts a lot of responsibility on managers, some of whom may not know it’s their responsibility to collect and capture data from their teams. They may be given lukewarm instruction to keep track of complaints or issues, or not given any instruction at all.
According to the report, gathering data begins with good policies. Employers must hold their managers accountable to company policies and values. Accountability is one sign of an ethical manager.
Second, managers should receive training on best practices to not only address real problems, but work with ethics and compliance teams to fully use data and information that’s reported to them.
The report concludes with the observation that successful companies are built not only on financial goals, but also on fundamental values and ethics. In other words, good ethics are good for business. Utilizing real data, and supporting managers, are important ways that companies can improve their ethics and compliance programs.