When we think about compliance training, we typically conjure up the popular topics: sexual harassment training, anti-bribery training, code of ethics training…the superstars, the popular kids. The courses that most employees take because they cause the big pains, the big headlines and the even bigger fines. But we don’t hear about other topics, like antitrust training, quite as often. I’m not sure why it’s not as popular, but given some recent headlines like “Antitrust Regulators Stepping up Investigations into Google” that may change.
When you think about it, antitrust training goes hand in hand with ethics because it is, at its core, about playing fair. The concept of antitrust is about promoting a free, open market and avoiding business practices that either violate or step into the grey areas of antitrust or competition laws.
What is Antitrust?
So, before going further, how about a little “Antitrust 101?” When we refer to “antitrust law” it’s really a collection of several US federal and state laws, which regulates the conduct and organization of business corporations to promote fair competition for the benefit of consumers. The main laws, the Sherman Act, the Clayton Act and the Federal Trade Commission Act, restrict the formation of cartels and prohibit other collusive practices regarded as being in restraint of trade. They also restrict the mergers and acquisitions of organizations which could substantially lessen competition and the creation of monopolies. (Fessing up: that last part on monopolies is really the only part I remembered from school until I started working in ethics and compliance.)
That’s a pretty high level summary of antitrust, but employees need to understand more than just the legislation. Antitrust training needs to communicate to employees how they should navigate everyday situations in practical terms. They need to understand why they can’t engage in price-fixing, bid-rigging, collusion on products and/or market allocation and capacity planning agreements. Anything around exclusive dealing, price discrimination and even now the most-favored-nation clauses can come under the antitrust umbrella.
Best Practice: Tailor Your Antitrust Training by Functional Area
I found a great article on Lexis Nexis that succinctly summarized the thoughts of several panelists in a webinar on antitrust compliance and training.
The panelists focused on document retention and how key it was to ensure that documents didn’t contain language that even hinted at violating competition laws. You can only do that if your employees understand it. One of the great suggestions the panelists make in the article relative to antitrust training was to tailor it. Specifically, the article notes,
“With so many potential problems, several compliance training approaches are necessary, from basic to specialized… training should include a mix of substantive law and the process of how to identify and resolve potential antitrust conflicts. Ideally, training should be tailored to the audience, with different presentations that address the various jobs and their risk profiles.”
The experts were all in agreement on this – tailoring the training to ensure that it was specific to the employees in each functional area. This resonated with me because I’m in marketing, and we like to use colorful language, which can be problematic. The example in the article was using a word like “dominate” within three words of “market.” The sales employees must be trained to not discuss present or future prices or other terms of sale, or agree to divide customers or geographic areas with other companies.
Senior executives can be unpredictable and they have decision-making authority – and often do not want to partake in training. However, for any antitrust training program to be effective – like with most other compliance training programs – there has to be buy-in from the top.
How can an employee understand if a document is a ‘bad document’ that might not pass the antitrust test? One of the panelists suggests using the The New York Times Test.
“Would the person you are talking to want to see their quote or email in The New York Times on the front page above the fold? Are you embarrassed to see what you have written? Would you embarrass the company with what you have written?”
Gathering Competitive Intelligence
Another aspect of my job as a marketer is to understand the competition. Of course, in order to stay compliant with competition law it’s critical that I gather competitive intelligence in an above-board manner. The internet really changed the way we study competition; there is such an abundance of information available and it’s become so much easier to find and share it. It’s more important than ever that organizations conduct competitive research appropriately.
The experts in the article strongly advocate that antitrust training instructs employees who gather competitive intelligence to stick to public sources, such as trade press and customers, but anything from customers must be documented. They caution not to gather any intelligence from competitors, whether at trade association meetings, other gatherings, or online forums, former employees of competitors, legitimate communications with competitors covered by NDAs that limit use of confidential information, such as mergers and acquisitions, toll manufacturing, or other collaborations.
This quote from the article really stood out to me because it’s so similar to what I wrote in the beginning of this blog.
“In the end… remember that a company is not just managing risk but is adhering to its own code of ethics.”
That really sums it up for me; competing fairly is doing business ethically.
Does your organization give antitrust training? Do you tailor it by function?