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Dec 28, 2014

Taking compliance training and reporting to the next level

More efficient data collection and analysis, plus more savvy communication with employees, can help make complaince programs more effective

On December 22,, the US Justice Department announced that French power and transportation company Alstom has agreed to pay $772 million to settle bribery fines in many countries it’s done business in around the world.

Alstom’s settlement is still a shade lower than the record-setting $800 million that Siemens paid in 2008 but bribery settlement costs are far above the maximum $400 million paid in 2010 and keep growing each year.

‘[Board] audit committee members are looking at their chief compliance officers and saying How is that not going to be us?’ says Patrick Quinlan, CEO of Convercent, which provides a software platform to help companies better manage their compliance programs.

In view of increased scrutiny of compliance programs by audit committees, traditional end-of-year reports from chief compliance officers to the board – focused on tactical events such as the number of hotline reports or training results versus last year -- won’t cut it anymore.

Boards now want to know what the business intelligence is behind all these individual actions, says Quinlan. Compliance management software needs to be able to analyze the intersections between company policies and fluctuations in results. For example, how many more investigations are being conducted as result of an update of a major expense reporting policy tied to prevention of bribery? An increasing number of investigations is not necessarily bad news, given that most occur around gifts and other unintentional acts that employees aren’t aware count as bribery, Quinlan says.
End-of-year compliance reports to the board need to say ‘here are the things we’re doing proactively, here’s what we’re finding reactively, and when you put those two together – here’s where we think we’re going to be next year,’ says Quinlan. ‘You have to have good data to do that.’

When it comes to the response rates from employees to compliance policies, companies must take a harder look at how they disseminate information. Being able to deliver compliance policy updates to employees and third party vendors in a mode that’s easy for them to consume it is critical, according to Quinlan, as is the tone from the top.

‘If you have a huge number of Generation Y employees, they can consume all that information via their mobile phone rather than have to do it on computers, which is the status quo of our industry,’ he says. ‘If you can do that via mobile device, then for a whole generation of your employees you’re going to have much deeper acceptance of that message than [you would by] forcing them into a place that they just don’t operate in as much.’

In addition, the ability to communicate about compliance via mobile phone allows employees that don’t work as much on computers, such as at fast-food restaurants and trucking and shipping firms, to be more aware of company policies. That can be more reassuring than when companies had to hope that store managers would provide training to disconnected employees. Convercent’s platform lets employees not only consume training materials via mobile phone but even attest to having been trained, much like signing a document that says so, Quinlan explains.

So, as compliance officers prepare their end-of-year reports, it’s a good idea to review what kinds of data they are sharing and what insights they are gleaning from it. While you can get that data by exporting information from a siloed system, it’s much more efficient to use a platform that integrates it for you, says Quinlan.

And that’s likely to help ease the worries of audit committee members.

David Bogoslaw

Associate Editor and Online features producer for Corporate Secretary