Walking the Walk and Talking the Talk – A CEO’s Commitment to Ethics and Compliance

by Michael Volkov

The phrase tone at the top is becoming trite. Compliance professionals use it over and over, and few people explain how to apply the concept.   Speakers and webinar presenters always gloss over tone at the top, emphasizing its importance but providing little practical advice. In some sense, it is hard to define in specific actions since the context and the actors can vary with respect to personalities, role in the company, and overall corporate culture.

No two companies share the same culture. By definition, a company’s culture is specific to the company, its history, its roots, its leadership and DNA. So, how should we start to explain helpful principles and practices?

I am skeptical of complex explanations, programs and advice. Compliance professionals and corporate leaders want suggestions, direction and some bottom line advice.

Depending on the range of corporate clients, and the number of clients, there are some common traits that can help to define practical actions that appear to work, or at least advance a company’s ethical tone.

CEO and senior leadership commitment: I know this falls into the category of obvious and general characteristics bear with me as I explain what I mean.

When a CEO and senior executives make video, annual or company meeting statements of commitment to a company’s culture — that is nothing really special. The true test of CEO and senior executive commitment is whether they express these same values in day-to-day activities, internal discussions, meetings, and interactions with outside parties. I know this sounds obvious but if the only time you hear about the company’s ethical principles is at corporate organization-wide or sector-wide meetings, there is more work to be done. To me, the absence of a commitment each day to a company’s ethical principles reflects the lack of a true embrace of the importance of trust and integrity.

Beyond articulating ethical values and principles, there are a number of steps and activities that demonstrate a real commitment. These include:

  • Integration of ethics and compliance at business meetings
  • Specific decision where CEO or senior executives explain that ethical principles transcend short-term financial gain from a business opportunity
  • Commitment to training and certifications by volunteering to complete training before other managers and employees
  • Speaking before small groups (e.g. new employee orientation) to emphasize importance of ethics and compliance
  • Written newsletters, videos, postings on intranet portal, and updated materials (more than once a year) explaining importance of ethics and compliance and commitment to hearing and responding to employee concerns, questions and comments
  • Symbolic acts of commitment to ethics and compliance such as small group meetings to listen to employee concerns, follow up on issues learned from employees, and communications of efforts to address employee concerns
  • Familiarity with company’s code of conduct, citation of provisions in company meetings and statements of support
  • Sympathetic expressions to managers and employees that reflect empathy and understanding of challenges they face working in the company and validate their desire to advance and improve in the company
  • Specific action steps to improve facilities, quality of life for managers and employees, and overall working conditions as part of commitment to ethics and compliance
  • A personal story of sacrifice of personal benefit to advance a common company goal or improvement of management and employee working conditions and opportunities.

This list is not meant to be exhaustive and can easily be modified to address other opportunities. Whatever actions are taken, a CEO and senior executives who are committed to advance a company’s ethical culture will find plenty of opportunities to demonstrate such commitment.

If the commitment is lacking, there is a little you can do as a compliance professional. After all, you can lead a horse to water, but in the end, you cannot make the horse (CEO and senior executives) drink the water.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Michael Volkov, The Volkov Law Group | Attorney Advertising

Written by:

Michael Volkov

The Volkov Law Group on:

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