Empowering Leaders to Build a Culture of Compliance. INTEGRITY: Everyday, Everywhere, Everyone. Foundation of leadership engagement.

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1 Empowering Leaders to Build a Culture of Compliance Courtney Mcburney Andrew Baird February 25, 2013 Utilities & Energy Compliance & Ethics Conference INTEGRITY: Everyday, Everywhere, Everyone One thing at GE remains as true today as a hundred years ago: GE s reputation for unparalleled integrity is its most precious asset. ~ Jeff Immelt 2 Foundation of leadership engagement GE Strategy UK Ministry of Justice Adequate Procedures Six Principles : 1. Proportionate Procedures 2. Top-level commitment Due diligence 5. (including training) 6. Monitoring and review 3 1

2 Leaders Shape Drive Own Culture Risk assessment 5 One example of leader engagement The challenge: learning of potential compliance issues and risks in highly distributed workforce GE Energy businesses: Large workforce: 100,000+ employees Highly distributed: >80 countries; thousands of locations, including small outposts Wide range of activities: line workers in plants, sales reps and field engineers traveling the globe, executives in offices 6 2

3 Global Bottoms-Up Review Annual review with all employees to identify and address ethics & compliance questions and concerns Every manager in the business required to meet with direct reports, review ethics & compliance policies, and ask for questions. Standardized training materials available for managers in 13 different languages. Questions not answered in the manager meetings were escalated and addressed. 7 Benefits of Bottoms Up tool Issue resolution: Key Compliance issues have been identified early and resolved. Risk assessment: In addition to answering individual questions, business leaders use the database to track trends and identify risk areas, gaps, and needs for process improvements and training, across the business and in specific geographic areas, demographics, and product lines. Message to employees: Ensures direct managers on site set aside time at least once a year to emphasize importance of ethics & compliance and open reporting. 8 reporting and resolution 9 3

4 Leaders and Open Even with a number of ways that employees can raise concerns... a large number of concerns are raised to managers Ombuds Manager Complianc e Legal Human Resources 10 Open reporting guidance for leaders Engage: create a safe environment for raising concerns; make time to listen to employees Evaluate: Assess and categorize concerns Escalate: Connect quickly with relevant experts Ensure: Communicate policy of non-retaliation; thank employees who raise concerns 12 4

5 Online Compliance Core curriculum for all employees Leaders can assign courses to their team based on role 13 Managers Tools Leaders can follow up with employees using on line tools Use the tools to understand current status of training goals 14 Tracking Metrics by Leader Organization/Function Total Population Course 1 Course 2 Course 3 P&L % 99% 100% P&L % 100% 100% Function % 100% 100% Function % 100% 100% Function % 100% 100% P&L % 99% 99% Function % 100% 100% P&L % 99% 99% P&L % 81% 92% Total P&L % 98% 99% metrics given to leaders quarterly Business and function data provided to all leaders Peer comparisons... no one wants to be in the red! 15 / GE / 18 February

6 Presentations for Leaders Materials readily available on line typically done in staff meetings or huddles Compliance communication tools Pre-packaged messages focusing on various topics Such as: How to Handle an Integrity Intellectual Property Revenue Recognition Doing Business with Gov ts Supplier Relations Risks in Emerging Markets FCPA <<Regional leader Header Here>> Over the past several months we ve been looking at Compliance topics that are critical to the Energy business growth and success. The topics included: Foreign Corrupt Practices Act (FCPA) Compliance Risks in Emerging Markets Intellectual Property Compliance If you haven t taken the opportunity to discuss these topics with your employees yet, I encourage you to do so without delay. As a manager and leader in our region, you should be the first person our employees turn to if they have an Integrity or Compliance concern. Currently, we will be focusing on Conflicts of Interest. Please click on the link to access the manager s package, and spend some time getting familiar with the content. You can use the tools presented in this pitch to help your employees understand what counts as a Conflict of Interest, what the implications are and how to avoid them. <<SPACE FOR LOCALIZED REGIONAL MESSAGE>> If you have any questions about anything in this package, please don t hesitate to contact our regional Compliance leader <<INSERT NAME AND ADDRESS>> If you would like more information on any Compliance topic at any time, you can always visit <<Compliance site>> Always remember to reinforce with your teams, acting with Integrity and Compliance is everyone s responsibility, at all times. Thank you for your support Best regards, <<EXECUTIVE NAME AND TITLE>> 18 6

7 All-employee communications Tailored local events at sites worldwide Posters, banners, stickers Social media Tools for site leaders & managers Local, Business, and Region Approach : Recognize & Reward Leaders encouraged to reward employees for compliance Process varies by GE business Peer Nominations through compliance website Top-down leadership nominations Awards given during high-profile business update meetings Both plaques and monetary awards Compliance awards even given to suppliers & customers! Leaders measured by awards given in Goals & Objectives 21 7

8 22 How do leaders evaluate? Compliance metrics (training, etc.) Number of concerns raised by business, region Employee opinion surveys Attendance and other indications of employee engagement in compliance processes or 23 Summary... Courtney Mcburney Andrew Baird February 25, 2013 Utilities & Energy Compliance & Ethics Conference 8