Philip Morris International

Transcription

1 Managing Regulatory Compliance in a Global Environment Robert Mascola, Director Compliance LA&C Philip Morris International SCCE s 9 th Annual Compliance & Ethics Institute Chicago September 14, 2010 Philip Morris International Sells tobacco products globally, except U.S. Seven of the world s top ten cigarette brands Offices in 68 Countries Small HQ in U.S. Operations Center in Switzerland Decentralized affiliates 59 manufacturing facilities in 32 countries Products sold in 160 countries Over 75,000 employees, with over 95% in the markets 1

2 Regulatory Environment General Competition law FCPA Sanctions Labor Environmental Data protection Records management Industry Specific Marketing Packaging Ingredients Illicit tobacco trade (Fiscal Compliance) Child labor Compliance Department Chief Compliance Officer Director Compliance Director Compliance LA&C Director Compliance Asia Manager Comm s, Training & Research Analyst Training Director Communications, Training & Research Director Compliance EU Director Compliance EEMA Manager Risk and Planning How do 10 people manage compliance in a global environment? 2

3 Managing Compliance in Global Environment 1. Get the Keys to the Business Assign risks to business function Business runs Compliance Program for assigned risk area Responsible for trainings, communications, risk assessment, program audits (but not investigations) Single Program Director as global head for each risk area Compliance Department role limited to facilitation and coordination 3

4 Program Ownership Structure FUNCTION HR Law Operations Marketing Finance IS Compliance PROGRAM AREA Employment Privacy Competition Law FCPA / Anti-Bribery Intellectual Property Product Regulation Environmental Health & Safety Marketing Fiscal Compliance (KYC, AML, Sanctions) Information Security Records Management Speaking Up Affiliate Org Chart - Compliance Records Management Employment & Privacy Advertising & Marketing Competition Law & Intellectual Property Product Regulation Managing Director Compliance Manager Regional Compliance Director Fiscal & Trade Contributions Gifts/Entertainment Government Relations Customs Director Compliance EHS Program Directors Reporting 4

5 2. Help Affiliate Heads Lead Affiliate Head as CEO Affiliate Head priorities are affiliate priorities Get beyond implicit support of compliance to active leadership Train new Affiliate Heads on their role in compliance Give Affiliate Heads tools to measure performance Embed Compliance into Affiliate Head performance appraisal Use inter-affiliate competition? 3. Get a Seat on Management Team Affiliate Compliance Manager is ideally part of management team Select someone who is seen as trusted advisor to Affiliate Head Able to credibly measure performance of affiliate business owners Requires seniority Successful recruiting requires commitment 5

6 4. Encourage Use of Written Plans Resources are limited Maximizing resources requires planning Central Program Directors should develop plans in writing Affiliate program owners should also develop annual plans in writing Shared with Affiliate Head and Compliance Manager Embed Compliance objectives into business plan 5. Align Accountabilities Affiliate Program Owners must be and feel accountable Embed compliance role into their job descriptions Owners to include compliance in annual objective setting Ensure that good performance is reflected in their performance appraisal Avoid pushback on accountability back to Compliance 6

7 6. Coordinate HQ-Affiliate Ownership Program Directors must get buy in for the expectations they set for affiliates PDs cannot rely on own reporting relationships Program Director should audit affiliate implementation of program for discipline and as feedback tool Centralize tasks where it makes sense Data protection, sanctions vs. competition law, marketing Encourage working groups 7. Make time for critical reviews Study available data Training completions Compliance reports and investigation outcomes Identified risks Opinion survey data Focus groups Incentive structures Employee exit interviews External data Draw connections, identify patterns and trends Redirect resources and implement corrective measures 7

8 8. Embed Communications into Business Get business owners to be the spokesperson for compliance Give function heads talking points to incorporate into business contexts Have management team members attend introduce, or deliver, compliance trainings Avoid white noise 9. Focus on Culture Without right culture, business will find ways to work around compliance Accommodate cultural differences without varying key principles Measure culture Give feedback on their performance Support lagging affiliates and reward high performers 8

9 CIS Findings Demographic Predictors My Company's culture supports reporting potential compliance violations (Code of Conduct, Compliance Policy or the law). (% Agree) 100% 95% 90% 85% 80% 75% 70% 65% 60% 55% 50% Gender SG Level Location Function Market Anonymous Affiliate CIS 2006 & Culture Handling 9

10 10. Make Risk Assessment Meaningful Make business owners accountable for defining risks and implementing mitigation plans Leverage HQ Program Director role in identifying risks Affiliate Compliance Managers role limited to coordination quality assurance update Affiliate Heads on status Get results embedded into business plans Design Risk Assessment and Management Global assessment refreshed annually, market by market Program Directors drive risk assessment Markets manage their own, specific risks Results drive global program improvement 10

11 Top 10 Learnings 1. Give the keys to the business 2. Help Affiliate Heads lead 3. Get a seat on the management team 4. Encourage use of written plans 5. Align accountabilities 6. Coordinate HQ-affiliate ownership 7. Make time for critical reviews 8. Embed communications into business 9. Focus on culture 10. Make risk assessment meaningful Questions or Comments? Robert Mascola Robert.Mascola@pmintl.com