Webinar: 2022 Benchmark Report Insights, Part 2

August 26, 2022

For the next part of this webinar go to 2022 Benchmark Report Insights, Part 1

To get a copy of the 2022 Ethics & Compliance Hotline Benchmark Report for yourself, download it here.

Transcript for 2022 Benchmark Report Insights, Part 2

Nick Gallo: Everyone, welcome to Part Two of the E&C Hotline Benchmark Report. We are here with the one, the only, Kristy Grant-Hart. If you don’t know Kristy Grant-Hart, time to get familiar. Kristy is probably one of the people that I’ve learned the most from in the ethics and compliance game. Her books, well, yeah, I mean, all of the books are phenomenal. We’ll be talking about those more in a bit. But we are here to dive into the second part, Part Two of the Hotline Benchmark Report. The woman who needs no introduction, Kristy Grant-Hart, she is a thought leader.

She runs Spark Compliance Consulting, and has really built a really great business and has so many great tips. Every time I spend some time with you, Kristy, if you hear me on something after that, I end up saying something that you said and people are like, “Wow, he sounds pretty smart.” So, so glad that you’re here. I always love doing these with you. Thanks for making Nick sound smart. Yeah, I appreciate that.

Kristy Grant-Hart: My biggest skill. Thank you.

Nick: And then Gio Gallo, co-CEO of ComplianceLine, and I am Nick Gallo, and welcome to the EthicsVerse. Each week, we come together to provide you with some great insights and some great conversations about the ethics, compliance, and human resource game so that you can elevate and you can do your job better and you can be more efficient and be ultimately more effective, because that’s really what the name of the game is in this last or in this next chapter of ethics and compliance.

Quick word, on ComplianceLine, we have a suite of corporate integrity products, which everybody should be well familiar with here, ranging from Issue Intake & Case Management, Credential Monitoring, Compliance Training that doesn’t suck. It’s nowhere near what Kristy’s really cool program is. If you haven’t seen that, you should reach out to her and check it out. Why don’t you give us a quick blurb on Competitor, Kristy, because I freaking love this thing. I wish I’d thought of this thing. Okay.

Kristy: Thank you. Compliance Competitor is a business simulation software game for high-risk teams where you can facilitate with no correct answers, which makes it incredibly interesting. You’re supposed to get the least worst one and it’s incredibly engaging. We’re happy to show it to you.

Nick: Like life, right? There’s no…

Kristy: Like life. Yeah.

Nick: …actual correct answers anywhere. So, today we’re gonna be diving into the Ethics & Compliance 2022 Hotline Benchmark Report. This is about investigations, this is about substantiation rates, and all those kinds of things. As we’re getting started during this intro session, I’d like everyone to drop into the chat, where you are from. Also feel free to drop into the chat, your LinkedIn, you know, URL. And really, our greatest asset in the ethics and compliance game is the community that we’re all a part of, and it only will work for you if you engage in it.

So, drop those connections in. Let’s get connected with each other. And as always, we are doing our world-famous EthicsVerse book giveaway. And what’s really great is that we have one of our authors of two of our books. Oh, Jack, the chat is disabled, so let’s go ahead and turn that chat on, please. We have an author of two of our most famous books on the panel with us today. So Kristy, your book How to Be a Wildly Effective Compliance Officer which is really required reading for everybody in the game, that is gonna be what our giveaway is.

And then also tell us briefly, I know we’re getting a little bit off-track already right out of the gate, but I’d like to also hear a little bit about this other book that you wrote. It’s not pictured here, but the one that you wrote with Joe and with Kirsten.

Kristy: Yeah, sure. It’s called The Compliance Entrepreneur’s Handbook. And if you are interested in creating a business, particularly in our amazing space, I think that’s required reading to show you everything from starting a business to succeeding in it and marketing it successfully.

Nick: When we get the chat turned on, so as always, the people who ask the best question, so it looks like the question piece is working right now. We’ll get the chat fixed in a second. But please drop in questions, we want this to be very interactive, if you want us to dive deeper on something. What’s great about having Kristy on and Gio on is that we are really gonna be sort of tactics-forward today. So, if you have questions, tips, techniques of your own, please drop those into the Q&A and we’ll try to incorporate those into our talk track.

And also, you can drop that into the chat now or into the Q&A now. If you’re interested in a custom Hotline Benchmark Report, we’re happy to do that. We’re gonna be choosing five winners today for that, which is a great thing. So, anyways, let’s get moving here. So, we talked about our methodology. If you wanna hear more about that from last time, go back and look at it, but long story short, we have a big dataset. We don’t do a lot of smoothing. We do a lot of… We wanna present the most conservative information we can and we wanna show you kind of the whole picture of what folks are seeing across the board.

So, today we’re gonna be talking about this framework where, you know, we try to slate this whole thing out around the main KPI that your investigation process is largely judged on, and that’s about closing cases faster. So, you’re gonna see a common theme of talking about good employee engagement, we’re gonna be talking about empathetic intake and adaptive intake to try to get that good information, and talking about systematic follow-up that’s going to be a repeatable process that we can work on from a continuous improvement perspective.

So, with that, let’s dive into this first group. So, this is Data Point 4, and this is one of the things that we track across the board all the time, and this is about issue categories. So, why don’t we start with you, Kristy. What did you find from this that you found interesting?

Kristy: So, you know, we’re always told that most issues are HR issues. And I think that to a certain degree, this really bears that out. So, if you look, you did a fascinating thing that I’ve not seen before that I will comment on in a sec. But if you look at HR resources, unfair management issues, unfairness that tends to be in the same category and discrimination, harassment, retaliation, you put those together and that’s about 36%, which seems either right or actually low to me. But I love this breakout of unfairness and management issues because I think that it gives you such insight into culture.

When you group HR as one big thing, you don’t really get the sensibility that, you know, my manager is being a jerk, my culture is toxic. That’s a really specific thing that you’re calling out individually. And I think that people who can track that year on year, it’s gonna be hugely beneficial to them as an adjunct to their culture survey to give them a much stronger indication of what is actually going on.

Nick: Yeah. That’s a great point. Gio, anything to add there?

Gio: Yeah. I think Kristy is hitting it on the head there that I think if you’re in a Compliance 1.0 environment, you might look at these and say, “Hey, that’s not my problem. There’s no regulation that says that, you know, managers can’t be jerks.” But if you’re moving through Compliance 2.0 to Compliance 3.0, where you understand that all of these things impact, you know, how much people trust the compliance team, how much people think that they’re likely to get retaliated against, what they’re, you know, propensity to be part of a speak up, listen up culture is.

Those things that maybe, you know, have not been codified by Congress that they’re, like, auditing you to make sure that no one’s a jerk, those things really drive your compliance culture and drive whether people are gonna participate in this thing called ethics and integrity. And those are great things to, you know, really have an eye on and be able to dig deeper into. You know, there are challenges with data clarity and, you know, your capacity and things like that. And obviously, if you have burning fires, you have to take care of those.

But if you’re on this benchmark webinar, you’re probably the type of person that wants to be in a continuous improvement environment, and you’re looking for ways to be better, not ways to just check the box and say, “All right, well, we’re probably not gonna be thrown in jail for this.” If you’re looking to kind of move past those kind of base cold requirements, these are great places to look for improvement. I think outside of that, we can have some discussions around these other categories, but there wasn’t a lot of kind of action in where these things were other than the privacy and InfoSec piece, which I think we’ve all seen concerns around cybersecurity and phishing attacks and all of that ransomware and all of that go up over the past few years.

So, not surprising. I think that would just note for our leaders here that, you know, there is an increasing need and demand and pull for you to collaborate with whoever is in your CIO office because those things are all of our problems.

Nick: Yeah. They’re all of our problems, and I think what’s interesting is how that jumped in the work from home environment, which I know we’ll talk about some more later. The thing I would add to this conversation about the categories is really that, you know, everyone’s categories are a little bit different. You know, tying those categories on your issue intake and in your case management system back to the thing that is the sort of source of truth, which in most cases, is your code of conduct, having consistent categories across and especially if you can map those back to trainings, that can get you that flywheel going, so you can see which areas need improvement, which areas you might need to double down on, or what might be some hot zones.

At the end of the day, I think you need to be able to make your categories work for you on two levels. One, there should be some representation of what you care about tracking. And on another level, as categories change over time, it’s a best practice to go back across your case management system and make sure that you’re updating those so that as you’re pulling analytics out on a longitudinal basis, you can see how particular things have changed. So, maybe you used to have discrimination in one category and harassment on a different category and this year, you turned them into one collective discrimination and harassment.

Well, go ahead and go back and try to change all of those historical categories and combine those things so that when you pull out, you know, your reports, you can actually show how those fluctuations have changed over time.

Gio: That’s great.

Nick: Okay. Let’s talk about this. Oh, and we were talking a little bit about, in the pre-show, Kristy, we were talking about retaliation. And you came up with this really great idea about categorization from a primary or secondary basis about retaliation. Why don’t you share that with us now?

Kristy: I think that it’s just really important to be paying attention to when you’re following up with people and if they are feeling retaliation. Some people have actually, like, created a separate category for that, which can help you understand whether or not this is happening and to be able to track it more closely. If you’re doing proactive tracking, then you can also have this reactive tracking. It can be really useful.

Nick: Yeah. So, just having a secondary category or an additional category for these kinds of things, particularly in the context of an anti-retaliation campaign that you might be driving forward in order to, you know, drive more speak up inside your organization can be a great little hack to drive that forward. So, a lot of what we’re talking about, in general, is the role that ethics and compliance can play in, you know, showing its value in the organization. I think we’ve all seen over the last couple of years, especially over the last year as the Great Resignation has really taken hold of our economy, that so many people are changing jobs because they don’t feel engaged at all.

And what this is supposed to show you is that every single organization is… So, this is some, like, hardcore econ modeling. I’m an old econ nerd as some of you may know. The point of this thing, to show you, is that this triangle, this light blue triangle in the mix here, exists in every single organization where there’s someone giving less than 100% effort, which is probably every single organization. So, if you think about the level of disengagement, which across the economy has been shown to be about, I think in the United States, it’s at 68% and 65%, you know, globally, this exists all over the place. And there’s, Kristy, I think you brought up an interesting other data point on sort of the cost of disengagement.

Kristy: Yeah. So, I was looking at a Gallup survey and the disengaged employee is incredible. It’s 37% more absenteeism, 18% lower productivity, and 15% lower profitability for that employee, which means that as a whole, each disengaged employee is 34% less beneficial. And if you put that into real terms for every $10,000, that’s $3,400 of loss, which is massive, massive amount of money.

Nick: So, you’re paying somebody $100 grand, you’re losing…

Kristy: $34,000.

Nick: …$34,000 is being… It’s a silent killer to the bottom line. So, why do you care about this? Well, you care about this because if you think about what the root cause of disengagement is, and Gio, you and I have talked about this a lot, talk to us a little bit about the root cause of disengagement and how that feeds into this speak up conversation that we’re in today.

Gio: Well, I mean it’s a few different things. Like, to me, it ultimately comes down to hope. It comes down to trust. It comes down to is it worth me putting in this effort. And if you don’t have any trust in your organization, then you’re not gonna put in the extra effort, because maybe it won’t go recognized or maybe you’ll do it and someone else will get the credit or whatever it is. If you don’t trust the organization you’re with, and you could zoom that out to the logo in, you know, the employee brand or you can zoom that into the manager and the person with sharp elbows sitting next to me.

But if you don’t trust that your work is gonna lead to results because it’s not gonna be recognized, you’re gonna be retaliated against, something’s gonna be held against you because of some, you know, identity that you have or something like that, well, then you’re gonna hold back and then you’re gonna go into, you know, that classic line from the movie, “Office Space” of, you know, just doing as much as you need to do to not get fired. That’s what drives all of this. And that can come from a bunch of different places, fear of retaliation.

You think that all these nice words that your CEO says or all this greenwashing from the marketing department are not really backed up by actions, but ultimately, it comes to this thing that, surprise guys, it’s this thing called integrity. Are all the different facets of your culture in your organization integrated into something that’s identifiable and reliable? If there’s not integrity, then people are gonna find a bunch of reasons to kind of step back and come in late or be a little absentee or take too long of a lunch or not put their heart into it or whatever. It comes from all those things, but it really comes from one thing, a lack of trust.

Nick: So, if we can engage people on a more authentic basis with this culture of integrity, give them a voice in their organization and persuade them that their voice actually matters, then we can directly pull this line, S1, toward the supply line and start to shrink that blue triangle. As that blue triangle shrinks, that $3,400 per $10,000 of salary that Kristy just talked to from that Gallup poll, that all falls directly to the bottom line. So, as we get more integrated into the knowledge-work economy, where we are our work, the efforts that we place and the efforts that we expend with our organizations with the programs that we administer, we have the opportunity to point to the value that we create in a much more direct way.

So, I love this kind of stuff. I love that this is part of the conversation now and I love that we can sort of affect this disengagement on a direct level. So, as you can tell, I get a little passionate about this. Gio, why don’t you talk…

Gio: And hold on, Nick, just to, like, tie that back in, what we’re talking about, we’re talking about culture and trust and integrity and stuff like that. But ultimately, we’re talking about it in this webinar because the things that you do with your intake, with your case management, with how you substantiate, with how you follow up and close cases out, those things are such a tangible, high-impact effect on people’s perception of your trust and your integrity in your culture. So, it’s a little bit ethereal and it’s a little bit, like, okay, you know, we’re talking about culture again.

But the things we’re talking about today, if you’re off the benchmark on these things or if you’re awesome at them and wanna keep getting better, these are the ways that you keep putting, you know, keep putting deposits into that culture bank and that trust bank. You do it by taking action on the cases that come up, by rewarding the people who speak up with the respective response or the respective action. This is intrinsically tied to the very tactical data-driven things we’re gonna be talking about the rest of the webinar.

Nick: So, Kristy… So, everybody, the chat is disabled on this webinar for some reason. We’re having some technical difficulties. Please dump your questions that you want us to speak to into the Q&A function that’s at the bottom of your screen. Kristy, we have a great question that came in, which is, what’s your opinion of this, will disclosing data in a transparency report be helpful to gain trust across the workforce?

Kristy: A hundred percent. A hundred percent. And people are afraid of it. I know they are. We have found that with our clients, those that actually walk the walk and that put the data out there, what happens is that people start feeling like they’re in a vacuum, right? If they feel like no one else is reporting, that they’re gonna be the one who’s in trouble, or that everyone’s gonna know about it, or nothing ever happens anyway, how do you counteract that message for me as a compliance officer saying, “We totally investigate everything. We’re really good at this.”

You know, nobody cares. No one’s paying attention. But actually, if you see statistics that say, “No, 300 people reported this year, 100 of them, you know, we know that they’re true. And of those,, you know, this percentage got terminated, this percentage got workplace plans,” whatever. When you show results in a way people can relate to them, that’s where people start to have trust in the system. You need the data to show that. And I don’t know why people are so scared of it. I think that they’re afraid it makes them look bad, that there’s 300 reports that bad things happen. But it’s the counter truth. People feel more confident knowing they did.

Nick: Well, yeah, I mean, 300 is a big number, right? And so, if you’re like, “Wow, there’s 300 other people in this organization that have chosen to speak up, well, then I can too,” there’s so much value in that. And again, we can’t talk about having a culture of integrity without having transparency as part of the equation. So, I would challenge everybody to lean more into the transparency and watch a lot of the magic unleash. So, let’s talk about some…

Gio: Yeah. I know we gotta get into this, but I think there’s another element to that other than the it might make us look bad. I think it’s this kind of very Compliance 1.0 myopic view of there might be some risk in disclosing some things that we have. And if that’s how you’re looking at risk, you gotta wake up to the multifaceted, you know, approach that a Compliance 3.0 leader takes of, yes, there’s some risks that we disclose something and someone, you know, to Kristy’s point, it makes us look bad or something, but look at all the positive externalities that are gonna come by us talking about this openly.

You know, if your meetings with your compliance and ethics team are just around anybody find something that has some risk and let’s shut it down, well, that’s how you become, you know, the island of “Dr. No” or, you know, the place where ideas go to die. You have to be able to look at this and say, “Hey, you know what, I know there’s some risks that might happen. Let’s figure out how to manage around that perception risk and let’s find out how to get some of these benefits of that engagement, that transparency, that trust.” And I think that when you kind of zoom out from that, hey, one thing might go wrong and say, “Hey, you know what, but there’s a lot more to gain from this,” you can find ways to communicate that, you know, you can redact data or whatever it is.

Nick: So, Issue Severity, the point here is that you’re gonna have a different severity level across your organization given the, you know, idiosyncratic risks that you’re coming into contact with. I think you wanna be partnered with a tool and partnered with a solution that allows for you to identify or you to have brought to your attention, the needles in the haystack, and you’re not trying to identify those things yourself. So, talk to us a little bit about, you know, Kristy, you had some really great takeaways from this EHS concerns thing.

And so, what this graph is showing you, all this stuff is much more articulated in our benchmark report. So, if you don’t have that, feel free to drop a 1 into the Q&A section and our team will aggregate those and send those things out at the end of this webinar. But what this is showing is how we have human resource concerns in the blue line and we have environmental health and safety in the red line. And we see a massive pop of that in early 2021 and a statistically significant elevation of that on through last year.

Kristy: Yeah. So, obviously, the intersection of environmental, health, and safety and HR concerns shows up in April 2020, right, where suddenly everybody is trying to work from home, we’re figuring these things out. But then, you have this steady decline over the course of the year, which I think is really when you start to get into the vaccine place. So, December really through sort of May and June of 2021. And then we’ve got this Delta spike. So, then we have, again, oh my gosh, you know, we need to manage this thing.

And interesting to me that we have an Omicron spike, right? So, that’s the beginning of 2021. But we don’t see that spike again in those EHS calls. And I think that’s probably due to the fact that Omicron is less virulent, but also that we have that vaccine environment for many people and many workplace mandates. So, I just find that really interesting that we’ve kind of gone away, I think, from that, that peak fear and are managing it in a much more consistent way now.

Nick: Yeah. I wish I’d sent you an early draft of the report because I would have loved to incorporate that insight. That’s pretty good. Okay. This is the granddaddy, not the granddaddy, this is a granddaddy. Issue Rate Substantiation. So, what we’ve seen here is a drop in substantiation rate over the last few years, which obviously makes sense, right? We are now in a work from home environment in many cases. There is a much bigger proportion of unsubstantiated or unsubstantiatable, you know, reports, right?

Like, if somebody is working from home and there’s no witness or things like that, you’re gonna have a natural sort of headwind for that. I think the key here is understanding, making sure that people understand not only the hotline’s purpose, your intake channel’s purposes, but also, what that whole reporting process looks like. That helps you… You know, you have to exhibit some agency over what you’re responsible for in order to kind of drive the types of outcomes that you wanna get. When you think about issue rate… Thank you for all these 1s, folksy.

We’re just making do with what we have. We’re not letting tech issue stop us. We’re just gonna keep charging forward. So, Kristy, when you’re thinking about substantiation, you have so many great takeaways and so many great sort of actionable tips on driving higher substantiation rates, what would you share with folks who are really kind of dealing with the substantiation rate, you know, well below that 50% mark that we’ve been seeing?

Kristy: So, I think that some of this may relate to trust in the organization. Because if you made… So, I know we’re gonna talk a little bit in the next slide or maybe just drive to it. The next slide is about also this issue of substantiation. One of the things that you’re talking about here is meaningful start point. And if you’re getting…if you’re not getting enough good information, that might actually show a lack of trust in the system, fear that confidentiality is not gonna be kept, anonymity at higher rates, meaning that people don’t want you to know what they are, who they are, because they’re afraid of retaliation.

So, I think that you need to really look at this as a trust issue potentially and I do think that when people are working from home, you don’t get that, to drop by, see the paper, see the weirdness in the behavior thing. And I think that that really does affect issue substantiation, as does the ability to do interviews remotely. I think that that also creates challenges, especially when it comes to things like document review. And just having things on the desk that look weird is half the battle. I’m telling you, that’s a big, big deal.

Nick: That’s a good point. Anything to add there, Gio?

Gio: Yeah. I mean, it’s just like this… This is such a complex one because part of why this is so important is because it’s the result of so many other things you do, right? So, it might be hard to troubleshoot and it might be hard to say, “Hey, my number is kind of off. Is that good or bad? You know, which of these 15 things should I do for it?” But, you know, to me, I would just encourage everybody not to shy away from this because it’s complex, but realize that, you know, this is something like, I don’t know, like your blood pressure or something.

You know, if that thing is in line, then a bunch of other things are healthy and if it’s not, you gotta figure out what’s wrong with it. Because it might be that people don’t trust you or it might be that, you know, people don’t know the process and know what they should be telling. It might be that your intake is just kind of middling and you’re not really getting good data because people aren’t prompted properly to share it or any of these different things. But if this is, well, you know, if this is healthy, then there’s a bunch that you can do with it, and if it’s not, you kinda gotta figure it out just because it might be one of six different things.

It doesn’t necessarily mean that you should look at the easier stuff. This is probably something worth, you know, checking quarterly and trying to parse out and trying to see if you can change it because this summarizes so much activity from, you know, how you advertise and promote to engage people and how much they trust and how you do your intake and all of that stuff. And so, how you follow up, right? Like, if you’re not good at substantiating issues, you might need to retrain your team on like how to get that substantiation out. But, you know, if you’re hitting this kind of 50% or above, then you should feel like you’re pretty healthy and figure out what you’re doing well on. And if you’re not, I think you gotta dig in on it.

Nick: So, we had a great question in the chat, and Kristy, I’d love for you to weigh in on it. And the question is from Miguel. And the question is, would you recommend calculating substantiation based on reports selected for investigation or on all reports received? And he says, “No, we do the former as all reports may indicate duplicates or near duplicates. Thank you. And then, I’d also love you to talk about what does it mean when we have to educate/create more awareness in the face of a declining substantiation rate?”

Kristy: Okay. So, to the first question, I think when you have reports that you absolutely can’t do anything with, where they’re, you know, incoherent or there’s nothing that you could substantiate or not substantiate, I think it’s worthwhile to take those out of your calculations because what use are they, right? You can’t substantiate anything because they’re not helpful. Where you get the ability to make a decision where you can do some sort of investigation, even if it’s very, very light-level and being like, “No, our CEO isn’t a gorilla,” you know, I think that, like, that’s not true, I think that that, you know, you can count that. It’s you investigated, he’s not a gorilla. So, I think that that’s where that usefulness is. And what was the second question?

Nick: In the face of falling substantiation rates, does it mean or would you recommend that we have to educate and create more awareness? And if yes, what was different pre-pandemic?

Kristy: Face-to-face training, right, and the face-to-face conversations, especially with managers being able to…if you have manager talking points a lot of times with code of conduct or with rollouts of the new, you know, ethics and compliance week, whatever it is, if you have manager stand up meetings where you’re actually hearing from your manager, that’s very, very significant and very, very helpful. I think that, for me, call numbers are more important than substantiation rates because that shows awareness more than anything else that people are calling.

So, substantiation is important but I also think that… What you wanna look for is trends of things like the kind of calls that are malicious. If you’ve got a bunch of malicious calls or not good faith calls, that’s something to consider from a culture perspective and that’s maybe something that you need to consider. But in general, I think that numbers are more important than substantiation rates.

Nick: Interesting. So, I know we have to keep moving because we have so much to cover, but I think what I would add to what you just said on the last slide, Kristy, is that calculating both types can give you different insights, especially when you cut this against what you mentioned at the end, which was, you know, valid report, you know, count on a on a per head basis, right? Like we said in the last episode, if you didn’t watch that, it’s worth spending some time running through it, but many of these data points or these metrics that we’re looking at must be looked at in concert with other ones to really get a better picture of the story that you’re trying to tell or the story that you can sort of, you know, conclude on.

So, with that, there’s this really interesting story. I think it’s a great article. Our team wrote for the Benchmark Report called “Gorillas in our Midst.” And it’s about that thing where there was that study where you’re supposed to watch, you know, five people pass a basketball back and forth and only to find out that somebody in a gorilla suit walked through and 90% of people didn’t even notice the gorilla. The point being that something that’s top of mind, whatever is in the headlines, that’s what tends to influence what’s coming through your hotline and what people are talking about, and so forth.

And Kristy, when we were talking about this, and you had this really great hack on how to leverage this sort of recency effect that is a cognitive bias that all humans have in the context of training. Tell us more about that.

Kristy: Sure. Well, first of all, that’s why your CEO was confused with being a gorilla. It’s there in the background in a suit.

Nick: There it is.

Kristy: There it is. It explains everything. So, this effect can also be seen in training, right? So, DOJ has told us to measure our effectiveness, one of the hardest things to do, frankly, of whether or not our training was effective. And when you look at this recency bias, one of the things that you can see is if your training was effective, then frequently you will have a spike in those kinds of calls, right, or a spike… So, if you can see that spike happening, you’ve done anti-trust training and suddenly, you’ve got a slew of anti-trust calls that really can help you to prove effectiveness in a different measure of your program.

Nick: Huge point. Huge, huge, huge point. We as E&C and HR folks, we have to be students of behavioral science, we have to understand how folks are wired because that’s what we’re driving. We’re driving influence on the behaviors of the human beings within our organizations. And only when we can get down to that level and understand it’s not just a bunch of words on a page, it’s human beings acting underneath the umbrella of our organization, that’s our only hope of, you know, crowdsourcing risk management where all the magic is available.

I’m gonna come back to this question that Trish just asked at some point. Hold me to it, Trish, if I don’t, you can give me a demerit. Okay. I wanna talk about reporter types and the insights you see, Gio, on how those have changed over time, particularly from a work from home environment.

Gio: Yeah. Is there a key for this?

Nick: Yeah. Oh, yeah. It’s hidden. It’s hidden at the bottom.

Kristy: Can I jump in on this one.

Nick: Yeah. Go ahead, Kristy.

Kristy: I feel really strongly about this. That’ll give you a minute to catch up. When you’re looking at this, look at this biggest trend here, is this customer and related party reporting, right, 35%. This is another place that I see so many companies fall down. They’re afraid to get that number out into the world. They only have internal reporting capacities. They only have the numbers inside. Don’t do that. Parties that are frankly unaffected, unafraid of retaliation, those that are telling you because you need to know, those are the most powerful ones. And so, this is another place where I think, you know, if we can harness the power of outside parties telling us what’s really going on, that is a huge benefit and this trend, I think, can show us that.

Gio: Yeah. Good point.

Nick: Gio, you had said something where you were like, “Who cares where the reports are coming from? There’s probably a ton more reports than you’re ever even getting.” You know, this is when this report was being built.

Gio: Yeah. Sorry. My view was kind of blocking the key at the bottom. But yeah, I mean, you know, that point that Kristy brought up, you gotta understand that our job spans the entire organization. It’s not just we only care about the things that employees report, right? So, like, you gotta zoom out from that and say, okay, if something is going on, like, if fraud is happening and a vendor tells me about it, do you wanna know about that fraud? Yes, I’d love to. You know, if a manager is, you know, harassing an employee and a customer tells me about it, do I not care about that because it’s a customer?

No, like, I wanna find out about these things, right? Because they ultimately impact your employees anyways and they impact your company and your brand and your overall success as both a risk manager and someone who cares about the mission of your company. So, if you can engage those other parties, listen, like a lot of the stuff that we’re talking about, if you wanna make your benchmarks better, it’s probably not do less work, it’s probably try to work smarter, not just harder. So, you may have to do something and, you know, try to get engaged with those third parties or try to, you know, open up your intake to, you know, welcome, you know, customers or patients or clients or vendors or somebody into it.

But if you can do that, it can really be some kind of rocket fuel into your organization because as, you know, things, you know, as systems just kind of behave, trying to get… You know, if you’ve been beating that drum with your employees for 10 years of like, “Hey, you know, speak up, we’re listening,” all of that, and you’re doing pretty well on that but you’ve done zero effort on your third parties, well, you could probably put some effort into your third parties and get a big pop from that, you know, while also being in kind of continuous improvement mode.

I would just also note on here, sorry, can you go back, that this anonymous and withheld has kind of normalized back to kind of pre-2020 levels. And that may be because of the pandemic and maybe because of people kind of being back in office or something like that. But we’ve seen this be around that kind of three and a half to four and a half place, and it jumped up in 2020, and in the past year, it kind of came back in line. So, I had been wondering, you know, where that line was. You know, if you block out the 2021, it looks like maybe that was just kind of spiking generally. But in context here, that kind of anonymous/withheld identity piece kind of seems to be settling back in that three and a half and four and a half range that we’ve seen, you know, for years before 2018.

Nick: And look at this. Look at this trend. I mean, this is wild, right? So, what this is showing you is reporter awareness. How are people finding out about the avenue that they’re reporting through? In the past, it was only a third that was coming through the internet. And you can see over the last few years, this is like more, you know, almost doubled to about two out of three. Two out of three reporter awareness sources were just the straight internet, Google. So, how did you see this, Kristy, as an opportunity for us?

Kristy: So, we spend so much time focusing on our code of conduct, on our policy, on our training. And if you look at the awareness version, that isn’t where it’s coming from. It’s coming from your intranet page. And I think that if we can actually publicize that more and really focus on micro-messaging around that, that it’s really important. Even things like having the link to that in the email addresses of the compliance department and maybe some others as well. This is where people are going. That’s where you need to be putting your efforts.

Nick: Yeah. So, you have to take advantage of that. Obviously, we’re not saying, don’t put it in your code. Absolutely do that. But you should be able to test it. Go on to Google or Ask Jeeves, if you’re still using that, and say, your company name hotline number or ethics line or, you know, ethics report, and see how many pages down and how many entries down there are until you find that link. You have to get people when it’s top of mind. You have to get ’em when they’re thinking about it. I mean, there’s just, like, some limit of the amount of effort that the average person, which is where our battleground is, there’s some limit to the average effort that somebody is going to expend and you have to do everything you can when you have that fish on the line to reel them in.

That means answering the phones live and making it simple for them to report. So, if you don’t have some kind of a portal page that causes your code of conduct and your FAQs in a way for them to do a web report or a way for them to just call straight up on their phone, it’s worth spending a couple of bucks because the insights you get from it, not only from a direct risk mitigation perspective, but the insights you get from it and from the benefits you get from it from collapsing down that light blue triangle that we had a few slides earlier from an engagement perspective to say, “Wow, they really are making it easy for me to speak up. Wow, they really do care about it.”

And you freaking add a page to that portal that says, “Here are all the changes that we made from people speaking up and here’s a little article about speak up hero.” These are all different things that can, you know, reinforce the type of environment, this culture of integrity that we’re trying to create every single day.

Gio: Yeah. I would just say, you know, you gotta kind of zoom out from, you know, you know that saying that, like, if all you have is a hammer, then all the world is a nail? Like, if all you’re thinking about is these are my tools, I send out emails and I have a code of conduct and I have training and that’s how I need to make people aware, you gotta realize that there’s at least a two-front battle, right? There’s, like, the generalized awareness of someone knows that I can report that, right? Like, I can’t tell you how many people I’ve, like, told about, you know, what we do or I’ve interviewed people and they say, “Oh, I don’t know if my company has that.”

I’m like, “Okay, your company is Fortune 50 company. I’m sure you have it. The fact that you don’t know is, you know, a problem for someone else to solve.” But there’s that generalized awareness of like, okay, if this thing ends up happening in the next five years, there’s somewhere to go for it. And then there’s the, hey, that thing happened, what should I do about it? That second part is where a lot of the battle can be fought. Because I imagine it’s in your code and it’s in your training and it’s already happening, and if it’s not getting the job done, well, then you should think about, can…

You know, if five different people have different lifestyles and preferences, can they find out how to report within two tries? They’re gonna google it and they’re gonna search their email or something. Are they gonna be able to find that that easily? If not, then maybe instead of 3 places, it needs to be in 10 places. And it’s probably not that hard to do, but you just gotta kind of put, you know, the link in a few places.

Nick: That’s right. Okay. So, we’re gonna spend, you know, a quick minute here on the ESG thing. Kristy, you have so much to say about this topic. As ESG intersects with or subsumes ethics and compliance, what are your thoughts about using this as an opportunity on any sort of point of the ESG sort of maturation spectrum?

Kristy: First of all, don’t let it subsume ethics and compliance. That’s my number one thing to say about that. I think that we have a huge danger in that happening and we really need to fight for the fact that we have a profession that is not this. But we do have a role to play in it, which is different. And I think that us being the leaders of it, and the place where it all comes together as the hub, is a really, really important thing that we can do. I think that we’re in a really dangerous crossroads right now. “The Wall Street Journal” had a fascinating article called “The Many Ways ESG is a Loser.”

And it was specifically talking about fund rates, but also the failure of ESG funds to actually have companies doing better things. And sometimes, it’s such a…well, you know, we call it in Spark Compliance, ethics washing. I think that you need to be… It is dangerous. Another survey I read said that 56% of CEOs are talking about it but 28% have a budget dedicated and 31% have a person even nominated. Okay. Come on, right? That data is gigantic. We’re talking about it, but no one is in charge and there’s no budget. So, I think that this is still absolutely an opportunity, but you need to focus on it as something that’s real and not just pretend.

Nick: Agree. Anything to add there, Gio?

Gio: I would just say that if you’ve been frustrated by anything over the past decade about how compliance is perceived, about how much budget you get, about how seriously people take you, about, you know, what it takes to get new tools adapted or to build your team, then you should look at ESG as one of the several things that you can be doing in order to change your lot in life and to get your company to the place where you know that you need them to be. People in our market, you know that this stuff matters, you know that this is not just like your pet project.

The company needs the things that we, as ethics experts, do in order to not just stay out of trouble, but to take care of employees and to thrive and achieve our mission. This is one of the keys that you can use to unlock that because it’s easier to show ROI. It’s easier to get, you know, marketing or ops to care about it. It’s easier to get the CEO to say, “Hey, you know what,” to Kristy’s point, “I hear you talking about this thing. I bet you’re one of these,” you know, whatever, you know, the majority of people are talking about, “I bet you’re one of those. I think we’re not one of the ones that have a strong plan in place, I can help you.”

But you gotta, you know, to this point, become the MVP and just take a step into it because, you know, it’s like everybody is starting, nobody knows exactly how they’re gonna do this. If you just start getting involved in the conversation and suggesting one of the next steps in that ABZ framework, hey, I don’t know all the steps to Z but I know what step B is, if you just do that, then this can be something that can help you address a bunch of those compliance woes and really allow you to get a better position of leadership across your organization.

Nick: So, the reason we love talking with Kristy, well, I’ll speak for myself, although I think I’m pretty on point for Gio, is you’re just so opportunistic and you get this sort of corporate sort of persuasion game that we all have to play to be successful. Because no one is gonna tap you on the shoulder and say, “Hey, you wanna do this thing? Hey, here’s a promotion.” You have to kind of go and take it and you have to go and get it to some degree.” And I think your book, not just “The Entrepreneur’s Handbook,” which seems like kind of an…

That’s kind of like an ethos undercurrent to that entire book, which is how to be a wildly successful compliance officer. There’s so many pages and there’s so many sort of like sprinklings of that seasoning throughout. And using that kind of a mentality to take advantage of the internet thing, or take advantage of the bystander effect, or take advantage of the recency effect, to take advantage of the ESG opportunity in your organization, those are the things that are gonna allow you to reframe your role if you’re, you know, God forbid, in this sort of back office, you know, cost center, you know, label to shed that and turn a light bulb on at the top that, wow, this department has so much opportunity and we need to take advantage of it.

Kristy: And if you’re gonna do that right now, this is one of the reasons that’s driving this slide. The European Union is really, really pushing for common taxonomies for the way to do ESG disclosures. The SEC, we’ve heard a lot about it. That may be undermined by what’s happened with the Supreme Court and the EPA. But it’s not clear yet what that’s gonna do. So, without a doubt, the EU is moving on this thing. If you’ve got EU operations, you know, we’ve got the supply chain law, this directive that keeps coming, and I believe it’s coming, period, that we’re going to have to be looking.

That supply chain law looks at both sort of the modern slavery human trafficking elements of things in your supply chain, but it also looks at carbon emissions and all the different scopes for ESG. So, you’ve got ammunition on several sides. You’ve got the marketing ammunition, you’ve got the fact that you should be the center of it and volunteer for that, and you’ve also got EU regulations and SEC that’s coming in. If you can use all those things together with the marketing pitch, you’re in really good shape.

Nick: So, your homework, anybody who’s listening, is to download the replay of this, edit on your phone or on your…whatever Kristy just said for the last five minutes and put that on a loop underneath your pillow for the next couple of weeks to really take some action on this. Because this is an opportunity that we have the risk of letting it slip through our fingers. So, issue sequence, this is the proportion of our reports that are follow-ups relative to initial reports. So, you can see, relative to the traditional comparison, folks in the compliance line system, they’re having, you know, about 80%, almost 90% of the total reports, you know.

It’s a very small proportion of follow-up reports. Kristy, you had a really interesting takeaway on this and I’d love for you to share that with our team and with everybody who’s listening because I think there’s some really good action that we can effectuate in it.

Kristy: Right. So, there’s a couple of things. The first one is you need good intake, right? We’ve covered that. But the second thing is, if you can’t get follow-ups, if people aren’t responding to your second calls and they’re not giving you more information, if you know who they are, you should look for retaliation. Because this means that the investigation has started and that people are aware of it. And if you need follow-up information, it’s probably because you’ve done interviews or because you’ve been asking for emails or documentation.

So, that’s the first thing, is to really ask those questions. Even if you can’t get more information, try to get that sensibility or look for it yourself. And the second one is that the EU directive on whistleblowing requires follow-up to tell people what’s happening within three months or at the very most, six months, right? So, we know that this is not only good practice. It’s required in Europe. So, we need to take that on as something that we do, period, because people stop trusting when they don’t know what’s happening, and that black hole effect gives paranoia.

I turn this thing and I have no idea what’s happening, nobody is telling me. So, that transparency of the investigation, even if you can’t give outcomes yet, simply saying we’re doing it, that we’re doing interviews and we expect to close this in the next however many days, we’ll let you know everything we can. That reassurance makes people so much more likely to keep participating. So, keep that door open. Set expectations that you will be following up, I’m gonna call you in a month, so that they know to expect it and they feel more confident in the process.

Nick: We have some clients who have, you know, that ethics portal I was talking about and they have a link in there for an FAQ. And on there, is a flowchart of what the investigation process looks like. Because someone is gonna sort of put a little bit of weight on the ice to see if that pond is really frozen through and they wanna get some insights in, like, is this a waste of time? Retaliation is a risk. You know, that ECI report which we always talk about, 82% or something of people who spoke up had actual retaliation.

So, there’s odds that there’s some retaliation going on in your organization, what a way to fight against that directly. So, I’m gonna pull a little bit of an audible here, because we have a great question with respect to our last slide, and I’d love for Gio and Kristy to kind of briefly weigh in on this. Along the ESG lines, what other advice could you provide to show the value of your ethics hotline from a qualitative or even a strategic point of view beyond just a number of reports, days to close, etc.?

Kristy: How that relates to ESG?

Nick: Yeah. From an ESG perspective, how can we show the value of our hotline in the context of an ESG framework?

Kristy: Well, let’s see. Let’s say you’re a manufacturing company and you have any sort of environmental report, those things can be quantified more easily in terms of how much damage that could have done, say, if you have environmental damage, if you have health and safety issues that relate to the environment. I think that that is a really powerful way to say, you know, had this not been caught, we would be looking at potentially, let’s say, the Environmental Protection Agency has fines on this up to however many millions, and that our individuals could have brought tort actions that would have cost us a huge amount of money or even a class action. So, you can quantify that more specifically in saying this hotline is the reason that we know about that. And the more of those you can kinda put together, the more that you can quantify what could have happened.

Nick: Anything to add to that? So, apply that to your industry if you’re not in manufacturing. That’s such a phenomenal answer. Gio, anything to add to that?

Gio: Yeah. I would just add two things. One, you can pull anecdotes out of the issues that come in. So, you know, any report that you do, you should be making the case for this, right? You should say, “Look how strong we are about this.” You gotta put a bit of your marketing hat on or lean on some of your friends who know how to tell a story in this way, you know, to a broad audience through written materials and say, “This thing came in and this happened and look, we caught this thing.” And then you can leverage what Kristy said and say, “This probably saved us. You know, this eliminated the 20% risk that we would get a million-dollar fine or something.”

You can put that on there and, you know, it’s not gonna be part of the audit, right? Like, that claim is not something that has to be verifiable and, you know, covered by an actuary. But you can pull those stories out and those anecdotes and say, “These are the kind of things that we do because we’re the type of company that cares about the environment and social issues, etc.” So, you can pull those anecdotes out. And I would also just highlight that this ESG framework is a data game that’s part of the reason why so many people are kind of nerding out on it.

And you can get a lot of data out of your hotline but it’s probably not gonna be the same data you’ve been looking for for the past 15 years. And what I’ve seen, you know, I helped manage a foundation and we kind of do some ESG-angled investing. And, you know, I’ve heard people kind of talking about how this is changing the view, you know, this ESG movement is changing the view of how executives and CEOs and boards view this. Right now, the data that you need to collect, not only, like, isn’t defined, can be defined by your company and say, “Hey, these are the things that we’re going to care about.”

And if you have that framework of here’s how we’re gonna define the environmental impact for our company, that’s obviously gonna be super different for like a timber and logging company versus a software company. So, you gotta pick your stats and then, you know, pick those and then figure out how your hotline can help support that. Do we have a category for that? You know, can we search for issues that have, you know, this word in it or something like that? But, you know, I think part of what makes people reticent to jump into this, among other things, is it’s not really clearly defined, but you can use that to your advantage and say, “Well, here’s the data that we have and here’s the way we can report on,” or “we’re gonna pick the metrics that seem relevant to our company and we’re gonna see if we can feed that through our compliance cycle and then get some of that information out of it.”

But, you know, the things that come in through your hotline, through your web intake, the things that end up in your case management and issue management system, there are a bunch of data in there. It’s probably gonna take a little bit extra work, but if you have a team or you have a partner in your vendor who can help you do that, there’s a lot better data here than someone in the marketing team who’s just gonna kinda make it up and try to do a survey and then imply it.

Nick: Marketing be damned. Just kidding.

Gio: I’m just saying, if we wanna run…I think that all of us, regardless of what we think about ESG, we would say, if my company is gonna be involved in ESG, they should run it with as much integrity as the ethics and compliance department is run. And if you want that, then you gotta be part of building that future.

Nick: All right, we’re getting toward the end here. Thanks for those comments both you guys. There’s so much opportunity, there’s literally opportunity everywhere if we’re just willing to sort of be bold, step out with some, some boldness and take advantage of it. So average reports per 100 employees, traditional comparison, somewhere around one and a half, ComplianceLine, average, somewhere around four. You see it across these different buckets. I think the big takeaway here… Well, nobody cares what I think. Kristy, what do you think about all of this?

Kristy: I think that people still don’t believe that more is better.

Nick: Yeah. That is nuts.

Kristy: We have CEOs and CCOs at, like, major, major, major companies, name brands that we work with, that still say, “Oh, thank goodness, it’s going down, or, “thank goodness we don’t have as many, you know, reports and we’re so much…” But they’re just afraid to hear them and they’re afraid that it means that they’re doing a bad job. I think they genuinely believe it looks bad on them to have more reports. So, we have to fight that. We have to fight the battle and we do it with numbers.

Nick: Yeah. And also, just think about how far away we are from the natural limit of reports. I saw a study that said something like 40% of people saw wrongdoing at work. That would imply, if everyone felt safe enough with no fear of retaliation, that would imply that there was 40 reports per 100 people in your organization. And we’re talking about four. So, even if you’re getting 4, even if you’re getting 6 at a relatively smaller organization, there are still 5, 6, 7, maybe even 10 times more reports out there than you’re getting. So, more is absolutely better. The science is there, the studies are there. You know, this has been totally falsified at this point.

So, you can lean on that. And if you don’t believe it’s better, I don’t know. I don’t know what to tell you at that point. What would you add about sort of speak-up rates, Gio, and how we can see the impact of our culture in numbers like these?

Gio: I mean, I think you gotta celebrate the wins, guys. So, if this has been moving up, you gotta say, “Hey, you know what, it just moved up 0.2 but we’re doing something right, and let’s do some of that.” You gotta motivate your team. The Compliance 3.0 leader is gonna be the leader that communicates and coordinates and motivates, you know, not just the Compliance 1.0 kind of legal focus stuff. So, you gotta celebrate those wins if it’s going better. And then, you know, you gotta kind of break it down.

You know, I think that most, contrary to what, you know, someone with their head in the stand might wanna believe, most organizations are relatively far away from the ideal where you wanna be. And I think that you gotta… You know, if anyone around you is saying, “Hey, great, we’re not hearing anything so everything should be fine,” you have to have an honest conversation with yourself and hopefully, them, about like, are we really the ideal organization or is there someone on our team who should be treated better and, you know, we’re not figuring that out?

Because, listen, like, these numbers could be at 10% and we still wouldn’t be there. To your point, Nick, they could be at 40% and we’d say, “Okay, 40% of our employees are speaking up.” Obviously, that’s like a very different type of program that you’re running to handle that volume and all of that. But you have to be…you have to get to a point where you’re not afraid of reality, you’re not afraid to hear feedback, and you’re not afraid of the work that it’s gonna take to do that. I don’t say that softly or easily because I know how busy everyone in our market is, doing the hard work that’s necessary to get as much done as they can.

But, like, this is not a battle that’s gonna be won in the next three months, it’s gonna be won in the next 33 to 30 years, and we gotta push for it. Because at the end of the day, like if your numbers are, you know, in that 2% range, unless you’re just so confident that nothing is ever…nothing bad is ever happening, you gotta figure out how to get it up.

Nick: Well, the average retaliation rate is 82%. So, there’s definitely more. Okay. We should have a whole webinar just on this particular topic because it’s such an opportunity. I mean, again, you’re gonna hear this refrain over and over and over again. There’s so much opportunity for us to effect and really actualize the types of cultures that we all wanna be a part of. And it starts with this thing, right? Any relationship you have that you feel disengaged with, you know, when we were talking about this in the show flow, Kristy, any relationship that you feel disengaged with, it’s because you don’t feel like the other party understands you.

Well, our relationship with our employees is no different than that. And part of that understanding is gonna come through a conversation and people feeling like their voice matters and their opinion matters and that somebody cares to hear about it and all of that. So, that can be done through an operation like this, but you gotta test your line, you gotta make sure that that customer experience, so to speak, is a good one, and that you’re doing everything you can to reinforce the fact that you actually do care.

There’s a ton of people in ethics and compliance and human resources who actually care about this stuff, but you’re not getting any credit for it if your SpeakUp rate is below 2%. I mean it’s wild. So there’s opportunities everywhere here. Okay, Kristy, you had such a great takeaway from this. This is sort of the seasonality of reporting. And you had a really kind of high-level strategic view on how to use something like this to your advantage. Can you share that with us?

Kristy: Sure. So when you look at this and you look at the ways that the reporting changes over the year, one of the insights in your report is that in Q1, we have this big bump, right, and in Q4, we have what they call the winter low. So, if you already know that you’re going to have reports in the early part of the year at a much higher level than any other time, you need to build slack into your program at that point with the expectation that that is what’s going to happen and this gifts the winter low, meaning that toward the end of the year, everyone’s pushing, they’re busy that training, they didn’t get out, they need to get it out right now. That’s actually really beneficial to know because you can plan that seasonality into your work plan to allow those investigations to go quickly and well getting your case closure rates down faster and knowing that at the end of the year, you can make up some of that.

Nick: Super smart. Use your situation to your advantage. And there’s always conclusions you can draw from the data that you have at your fingertips. I mean, what a way to really kind of get the bang for your time buck by slotting and planning on a sort of annual level to take advantage of this law that that so many folks seem to see. So, Gio, wrap us up with these actionable steps. Folks, we’re getting close to the end here. So I’d love for if you love Kristy, if you’ve loved this chat, or if you’d love this conversation, drop a 5 into the Q&A so we can know what you want to see more of. We’re always open to hearing more ideas of different topics. Gio, take us away on the actionable steps before we show folks what’s coming up down the road.

Gio: All right. Well, I don’t think I can get into Q&A but I’m gonna give two 5s because I love Kristy, and she’s been showing me…

Nick: Two 5s for me too.

Gio: Listen, at the end of the day, it’s great to get the data, right? We hope that you download this benchmark report, that you go through it, you compare it to your data, and you make your team better. But at the end of the day, the action is what matters here, right? Knowledge is power, but knowledge and action transforms the world. So you gotta recognize…Like it says here that your employees are your first customers, right? Like these are the people that you rely on to do your job that you need to cooperate with you and collaborate with you in order to do this. And this is a whole cycle. This is not just your reporting rate. This is not just the investigations that you do. This whole thing cycles back…this is really important, it cycles back to all the employees you’d never interact with, right? If you’re getting two or three or 4% of your issues reported, probably 90%-plus of employees are not really actively interacting with your compliance program throughout the whole year.

But the way that you take action through this very public interaction forum, through your hotline, through your web form, through your case management, through those investigations, that ends up rippling out to the rest of your organization. So it’s the start of a conversation but you got to do the follow-up, you got to do the substantiation, you got to let them know what’s coming. And I’m telling you guys, like if you are not having these conversations with your employees, be it through exit interviews, or just by doing town halls or just walking around and building friendships with people, there is a culture and a mindset in your organization, whether you created it or inherited it or whatever, there’s a culture of the mindset around compliance and we got to work on making that better.

I have this conversation with people when they come on for us, we’re interviewing and they say, “Oh, well, I would never do that. Because my friend they told me that this happened to them and I’m never speaking up or whatever.” Those things are out there regardless of what you put in your newsletter. There are new people coming into your organization all the time that you have to let them know that, “Hey, things are different here.” But you can use it in creative ways to get that engagement and I’m moving down through the circle.

Do that intake the way that first bite of your interview and investigation process taste can really kind of set you off on a good or a difficult path. Make sure that your intake whether it’s digital or kind of in-person through a hotline or whatever, that it’s empathetic and adaptive. And then when that follow-up is not just in the interest of what your compliance team needs to figure out but in the interest of, “Hey, what are these employees care about and how do I get a win?” even on this kind of obscure type of issue, if you can get that cycle going, it can be a virtuous cycle where those new employees come in, and they say, “Oh, well, I’m not gonna say anything.” And two or three other employees say, “Oh, no, we do that different here. This is culture. That’s how we do it here.” “Hey, over here, you can speak up. I did and my friend did and someone else did and it all went great.”

But it’s a resource for your whole organization, your hotline, your issue and take the data that you can get for ESG. And this is, like I said, a very public forum for interaction, and really a great way where you can engage people at these critical points in their life as an employee and really make a positive impact for them. And I just want to encourage you that regardless of where you are against these benchmarks, in the maturity of your program, in your maturity in your career, we’re all leaders because we all have an influence on the people around us. And I hope that there’s something in what we’ve gone through today that can help you become a better leader and have a better impact for good on your team.

Nick: We have a bunch of great episodes coming up. We’ll obviously do more with Kristy Grant-Hart anytime we can. We love having you on. Round of applause for Kristy. Phenomenal ethics first episode today. There are a thousand 5s. Look like people created ghost accounts to drop more 5s into the chat because people love this session. So thank you so much. Every Thursday at this time 12:00 Eastern, we have an ethics first episode.” So here’s a couple of the ones coming up. Valerie, I see your hand raise and we’re gonna allow you to talk in one sec.

But thank you all for staying through the end. The replay will be available, certificates, and all that stuff as well. So, Valerie, go ahead. It looks like you’re on mute if you’re talking, Valerie. We’ve never done this before. This is amazing. Okay. All right. Well, it doesn’t look like it’s working. Valerie, if you want to drop that in the chat. It looks like you’re on mute. Drop your quick question in the chat. If you want, Kristy, do you have a quick sec to see if you can answer this question?

Kristy: Yep. And, Trish, she didn’t answer Trish’s question either.

Nick: I know you held me to it. I said Trish could hold me to it. So I’ll take the demerit, merit or we’re not doing that? I’m getting the demerit. Give me the demerit. That’s fine. So her question was about…Yeah, her question was about, “How do we deal with substantiation when we’re referring things over to HR?” I think that was kind of the question. Yeah. Do you refer HR issues to HR and then how do you substantiate? How do you deal with the substantiation loop there?

Kristy: I think that you have meetings monthly if you’re getting a lot of HR issues, every other month if you’re not that you actually train them on what substantiation means. And you review what they’re…if it’s a hotline call you review what did they do and how did it end? And I think that one of the ways that you can make it look like it’s not quite so critical is to say that you’re trying to track disciplinary actions across the company, because that’s really required. And so when you look at substantiation and say, “Okay, this was substantiated. What do we do about it? It’s been a framework that I’ve seen really effective, so that HR doesn’t feel like you’re second-guessing them, but that you’re actually like taking that data and doing something with it. But you can use it as a learning opportunity as well to try to talk about what substantiation means and how to determine it.

Nick: Yeah. We should be not siblings with a tape-down the middle of the room. We should be good siblings. We should be working together because we’re fighting the same battles, right? Like we’re trying to drive a culture-forward. They care about employee experience where we’re fighting the exact same fight. So the more harmony between these departments and if their silo walls built up because you stepped into that organization, you stepped into kind of a tape in the room, you can be bold and you can reach out across the aisle and you can start to build those relationships. There’s such a separation, Kristy, I think NGO between organizations where ethics and compliance and HR are like friends and they’re running and stuff together versus the horror stories we hear about them fighting with each other.

Kristy: Yeah.

Nick: Okay. Well, we ran over a little bit. Thank you all for joining. Thank you all for staying. Great episodes coming up. Thank you, Kristy, for coming. We’ll have the book giveaway. The book giveaway is going to be limited to just Kristy’s books because anytime Kristy is on we just have to give away just your books but love your work, Kristy. Thank you all for coming. And we’ll see you next time.

Kristy: Thank you.

Gio: Thanks, everybody. Bye-bye.

Nick: That was a pretty good one, you guys.

Gio: Yeah. Thank you, Kristy.

Nick: Pretty good one. All right. Do I have to end this?

Gio: Amazing.

Nick: Okay. All right. I’m gonna end it. Thank you so much. This was a lot of fun. Talk to you soon.

ComplianceLine is now Ethico!