FCPA Compliance and Ethics Blog

March 6, 2012

The President and Lin-sanity: Lesson Learned III For Your Compliance Program

Lin-sanity still reigns and it may well now have reached its penultimate level. What evidence do I have of this cultural phenomenon? It is that both US President Barack Obama AND Sarah Palin are now on the Lin-sanity bandwagon. Palin, who played basketball in high school, is pictured at the left with the highly coveted Lin gear outside her Manhattan hotel. Not to be outdone, last week on the B.S. Report, a weekly podcast hosted by the Sports Guy Bill Simmons, held at the White House, President Barrack Obama talked about Lin-sanity and his fellow Harvard alum Jeremy Lin.

The President made an interesting comment, which I thought spoke to an ongoing issue in the compliance world. His observation was that Lin’s in-game success did not happen overnight, so question for you where were all of the ubiquitous NBA coaches all through his practices during the 15 months he has been in the NBA? The President thought that some coach, should have seen something, which indicated Lin had some talent. While we can ponder the wisdom of the 30+ coaches, between the Warriors and Rockets, who all blew that one, one of the things that the President’s comment brought up for me is the role of training in any best practices compliance program. Why you might ask? The answer is because one of focuses within an organization is to not only develop talent, but to evaluate talent in everyday work situations; similar to evaluating a basketball player in practice. So the Lin-sanity Lesson III is that one of the areas of training is to teach business unit employees to coach and evaluate compliance talent in an organization.

This is an area that Human Resources (HR) can be of great assistance to the Compliance Department. Compliance can take the lead in training on the substance of compliance. However, HR can assist in training managers to evaluate and audit employees on whether they conduct themselves within a culture of compliance and ethics. This is the traditional role of HR. While there is a training requirement for any minimum best practices compliance program, based upon the requirements in the US Sentencing Guidelines, I would submit that there is an opportunity to bring additional and more focused HR based training to bear which would enable a company to develop leaders who are thoroughly grounded in compliance and ethics.

Under the US Sentencing Guidelines, companies are mandated to “take reasonable steps to communicate periodically and in a practical manner its standards and procedures, and other aspects of the compliance and ethics program, to the individuals referred to in subdivision (B) by conducting effective training programs and otherwise disseminating information appropriate to such individuals’ respective roles and responsibilities.” This requirement would also suggest that training results should also be evaluated and once again HR can fill this role. As part of this evaluation, a candidate for promotion can be assessed in not only their interest in the area but their retention of the materials going forward. Lastly, HR can evaluate how a candidate for promotion incorporates compliance and ethics not only into his or her work but how the candidate might help to foster a culture of compliance in the company.

President Obama’s remark about Jeremy Lin and what he may have shown in practice brought up the day-to-day work that any NBA player must go through which is watched by numerous NBA coaches. This concept is the same in a business organization. The day-to-day practices equate to how employees comport themselves whilst doing the routine and daily business of their companies. It’s a good bet that if an employee acts in an ethical manner in his or her routine dealings, they will do so in a situation which requires conducting business through a culture of compliance. HR is a part of the corporate organization that can evaluate these day-to-day scenarios. HR can also train business unit employees to evaluate personnel on compliance and ethics issues. You should not miss this opportunity to watch and evaluate your employees!

This publication contains general information only and is based on the experiences and research of the author. The author is not, by means of this publication, rendering business, legal advice, or other professional advice or services. This publication is not a substitute for such legal advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified legal advisor. The author, his affiliates, and related entities shall not be responsible for any loss sustained by any person or entity that relies on this publication. The Author gives his permission to link, post, distribute, or reference this article for any lawful purpose, provided attribution is made to the author. The author can be reached at tfox@tfoxlaw.com.

© Thomas R. Fox, 2012

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