A Hands-On CEO and Support for Compliance

ceolead2A compliance program without CEO support is almost doomed to be ineffective. We all live by the standard of an “effective” ethics and compliance program. I am always reluctant to embrace a dogmatic expression but the support, and hands-on participation of a CEO, can be the difference between an effective and ineffective compliance program.

A CEO not only has to embrace the importance of an ethics and compliance program but the CEO needs to “lead” the ethics and compliance program. The CEO’s role is not to make sure that checklists, rules, procedures and policies are in place. Those tasks can be accomplished by the CCO with the assistance of compliance and legal staff.

What is more important in the scheme of ethics and compliance is for the CEO, senior managers, and everyone at the company to understand how their actions influence behavior of company managers and employees. This is a critical point – what really matters in the end is the personal connection between managers and employees.

The framework and ultimately the success of those relationships depend on leadership by the CEO, commitment to fostering such relationships, and requiring business leaders to take ownership of compliance. As long as compliance interfaces with the business units as a separate and wholly distinct function from business, a compliance program will always depend on compliance chasing business people to comply with internal compliance policies.ceolead3

The transformation of compliance into an organizational value requires the CEO’s commitment, and then accountability of the CEO’s leadership team. To carry out this process, communications and awareness of the impact on employee behavior becomes key areas of focus. Business leaders have to communicate the importance of compliance, demonstrate their commitment to compliance, and educate their employees on the value of compliance.

To help business leaders with the compliance function, the CEO’s message needs to be clear: “the company is committed to compliance, we already are working to ensure compliance and they need to pay more attention and make more effort in compliance.”

The CEO and the CCO have to provide support – tangible and intangible for business leaders. In other words, they have to provide them training and support documents, services and resources to business leaders to enable them to carry the message forward.

Underneath the message, the CEO, with the assistance of the CCO, has to define the values and behaviors that they expect from their employees. Getting buy in from the senior business leaders is the first step in rolling out an effective ethics and compliance program. From there, the message and commitment has to be pushed down throughout the organization – down to the next level of business managers and so forth.

CEOThe rolling out of the compliance program, the pushing “down” of the message to business leaders, and the execution of this requires the CEO’s time and commitment. The CEO must speak or communicate the company’s commitment to this new and exciting ethics and compliance approach. In doing so, the CEO has to make it clear that the business depends on this new and effective ethics and compliance program.

Compliance needs a strong leader and when the CEO positions him or herself as the leader, business managers will follow. If compliance is a priority to the CEO, business leaders will want to participate and support the mission. The more the CEO speaks about the issue, the more the business will buy in.

All of these points may sounds rather obvious these days, but if you want to take a temperature on your compliance program at your company, just ask yourself questions concerning your CEO’s commitment and participation in your company’s compliance program. The answers (and perhaps the solutions) will become rather obvious.

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