Monitoring and Measuring A Company’s Ethical Culture: Relevant Survey Strategies (Part I of II)
Chief compliance officers play a key role in managing a company’s ethical culture. Most companies fail to pay proper attention to its culture because it is difficult to define, measure and monitor. Such an approach is short-sighted.
CCOs have to embrace this issue and develop appropriate techniques to measure a company’s culture. All too often I observe companies that rely on annual or semi-annual company-wide surveys of employees to measure the company’s survey. While such surveys may be helpful, CCOs should partner with Human Resources to develop a more robust survey program. Surveys are not the magic bullet to learning about a company’s culture, but they can be an important tool in a culture management program.
Before discussing the types of questions to include in such surveys, two important issues have to be addressed.
First, the target audience for surveys should be defined to permit quick surveys, perhaps by limiting the survey to a relevant, high-risk country, office of division. CCOs should establish a quarterly goal of conducting a brief survey each quarter, or no less than four per year. A CCO can then report to the board on the reason for the survey, the results and any remediation plan.
Second, CCOs have to design each survey carefully to assure employees of confidentiality and anonymity. Employees may not respond to a survey if they lack confidence their identities will remain anonymous. In addition, the survey introduction should explain the purpose of the survey and the manner in which the results will be disclosed and ultimately used to assess a company’s culture.
Everyone is familiar with the important elements of an ethical culture. At ethical companies, employees are engaged and productive; employees believe that their feedback and concerns are valued; and employees understand the company’s mission, the specific role they play in achieving that objective, and the importance of their ethical performance at the company.
Employee engagement is a central aspect of an ethical culture and a significant factor in successful financial performance. When employees are engaged, companies perform better over the long run. Employees who are motivated and committed to teams are more productive and less willing to leave the company.
A company’s ethical culture includes an effective speak up program to encourage employee feedback. Employees are encouraged to report concerns to their supervisors, HR, legal, compliance and employee reporting systems. Confidential and anonymous surveys can be an important part of a speak up culture.
Employee turnover can be costly to companies. The cost to replace and train an employee can add up and can result in significant losses in employee productivity. Employee retention rates are an important indicator of a company’s culture. HR and compliance vendors offer automated survey programs that can be tailored to a company’s culture program.
Employee surveys are a quick and effective technique to measure the company’s culture health. Targeted surveys can provide valid indications of morale and potential disruptions in corporate culture. The surveys can be used to measure engagement, perception of ethical commitments of the CEO and senior management, feedback on operational and strategic issues, as well as overall employee satisfaction and loyalty.
A regular targeted survey program has important advantages over an annual or bi-annual employee survey. Employee perceptions and morale can move up or down quickly. If the CCO & HR leaders conduct a survey only annually or bi-annually, the results may be stale or an important trend may be missed.
A targeted survey program can be designed to address high-risk areas or operations. Further, the survey program can provide real-time results about company operations. Such surveys can identify an important trend that may reflect a deterioration in employee engagement. In response, companies may be able to minimize any deterioration by adopting proactive strategies to improve employee engagement and morale.