FCPA Compliance and Ethics Blog

April 9, 2014

Tales From the Crypt: Rule No. 8 – Even Sailors Behaving Badly can get Promoted

Tales from the CryptEd. Note-the Two Tough Cookies are back with today’s guest post on the toleration of bad behavior…

It is no secret that “sailor’s mouth” is an acronym for someone who liberally uses foul language in even the most formal situations. There was a time in my life when I was known for dropping the “f-bomb” a bit too frequently, but age, experience and just plain civility has given me the presence of mind to be sensitive to others in a way I was not early in my career. I don’t even use that particular term in casual conversation with friends any longer without feeling a tinge of regret as soon as the word crosses my lips, acutely aware that it’s a bit “unseemly” of me, and doesn’t reflect the person I’ve grown into. I am less “familiar” with people, as I have come to realize that familiarity does indeed breed contempt, particularly in the workplace. I don’t even relax in casual get-togethers with friends, as many of my friendships are the direct result of my work relationships and, as we know from prior posts, appearances matter. When you are an Integrity and Compliance professional, people look at the whole person, not just the person who shows up to work, and personal conduct outside the workplace can result in just as damning a judgment from peers as conduct within workplace walls.

I was less than a month on the job when I was handed the work files pertaining to the hotline calls that had come into the organization before I was appointed to the compliance function. I had met with the HR professional who handled the lion’s share of the investigations, but one stood out – instead of the file name being labelled by the implicated party accused of wrong doing (as most were), this file was labelled under the name of the accuser. What I found within was nothing short of extraordinary, and, in hindsight, gave me crystal clarity to what lay ahead. What puzzles me (and many of my colleagues) to this day is how individuals such as those we describe in our Tales seem to consistently percolate to the top of their organizations, landing one plumb assignment after another, and those of us who keep our heads down, demonstrate respect and do our jobs with professionalism and dedication seem to get shunted off to the side again and again. We’re missing something important and this Tale from our Crypt spotlights one of the worst of the worst…

The time of my appointment was one of change. The CEO, unbeknownst to me, was preparing for retirement, planning on “ruling” his roost for only a few short months before turning his mantle over to one of the senior level executives who had steadily risen through the ranks and was now in charge of the largest revenue segment of the company. The Chief Human Resource Officer (CHRO) had “resigned” only a few months prior to my arrival, and I could not get a straight answer as to why. The interim executive in charge of the human resource function had only been at the organization a short time, overlapping the prior CHRO’s tenure by only a month.   He already had business cards printed with the title CHRO under his name, even though the board had not officially sanctioned his candidacy for the role and there was still an active executive search underway. By all rights, I should have been clued in then and there, but I was happy to have a job, having just left a rather unsavory position at a privately held company that made “hostile work environment” sound like a Hawaiian vacation in comparison to the draconian employment tactics they routinely used that forced me to stop and meditate every morning prior to crossing the threshold into the office.

The file that I had open before me told a story of foul language, abusive behavior, threatening gestures, lack of sensitivity for “personal” needs (such as terminal illness resulting in a death in the family), disrespect towards subordinates, and falsified work history. Was this guy for real? And to have him as “Charles in charge” of the HR function for a large, global company? I was shaking my head in disbelief. To further compound matters, the company had already hired a “coach” to work with him on his foul language…. and still, there was no apparent change of behavior.

The person who filed a complaint against this individual was so intimidated by his language, threatening gestures, and workplace violence (he once threw a pencil at her from across the room, saying people’s actions weren’t going to stick, just like the pen didn’t stick to the wall) that she asked to be demoted and lose pay in order to not work for him any longer.

Shortly after our new fearless CHRO took the reins, I caught wind that not only was the CHRO being snickered at behind his back for his outrageous behavior, word had it that he had actually falsified his work history, claiming a higher level HR executive position on his resume than was true. I had it on “good authority” from another HR professional that when both the CHRO and my “source” were colleagues at this same company, our new CHRO had established himself firmly as a “buffoon” and had risen no higher than a manager at his prior organization. Yet he managed to convince our hiring folks that he was “leadership” material…. and it was no wonder when we looked at the new hire due diligence process (coming up later)…

A really quick way to percolate talk around the coffee pot (and erode the respect your employees have for the organization) is when a company bends over backwards to accommodate an executive’s special needs, especially setting up offices and whole operations in places where the company never had a business presence, for the convenience of the executive (or one of his top subordinates). Not long after his self-appointment, our new CHRO became so enamored with a candidate of his choosing that he pushed to move an entire HR function to this candidate’s home state, disrupting the lives of several dozen individuals who were forced to either move to the new location (a full day’s drive and 5 states south of headquarters), find a new position at HQ, or be laid off.  In this instance, the CHRO’s “pet” was ensconced to oversee several HR support functions out of this new location. Given that the “pet” was new and unproven as an employee, the talk speculated whether or not there was something going on between the CHRO and this new hire. Then this new manager pushed through the hiring process a candidate she had chosen in spite of the interview panel commenting that the candidate’s “demeanor was deceptive.”

When it came to the background check on new hires, “asleep at the wheel” comes to mind. The only reason this candidate came up on my radar was when another HR colleague suspected something was amiss when the company was pursuing some government contracts, and a request for documentation was issued from a state agency that wasn’t part of the bidding process. This Mata Hari’s mistake? When we opened the file (which was sent via email, from a fabricated email address, from a web site she created and launched only a month earlier, which very much had the look and feel of an “official” state agency, and even had a live phone number answered by her “significant other” – you get my drift…), the metatags on the document indicated she was the author, and not the state agency.   When we reviewed her application, and did a root cause analysis of what went wrong, it became clear that expediency won over reason, and red flags which surfaced in the original background check were overlooked, even though several points indicated her candidacy as “unverifiable.” False names were given for references, and burn phones given for contact info. Job positions were fabricated for companies which did not exist, and couldn’t be found on either the internet, or by the PI’s we hired to actually visit the sites identified. We weren’t even really certain if the candidate’s social security number was really hers … but I digress.

We have seen it again and again – people behaving badly, getting away with it, and in some instances, being “rewarded” for their behavior by being promoted soon after a workplace incident was brought to my attention. We have yet to break the “code” of when arrogance crosses the line from being “coachable” behavior, to being “assertive” and a “closer,” thus worthy of promotion. We cannot figure out, for the life of us, why allowing fundamental compliance lapses such as due diligence in hiring can be overlooked, shrugged off as if inconsequential. We have come to the conclusion it all has to do with whether or not you’ve finally been accepted into the “inner circle” and/or whether or not the company feels too “invested” in the person to simply punt them out of the arena for being abrasive, and in some instances, downright hostile. What amazes us even further is when it is the Human Resource Function that is behaving badly….

Who are the Two Tough Cookies?

Tough Cookie 1 has spent the more than half of her 20+ legal career working in the Integrity and Compliance field, and has been the architect of award-winning and effective ethics and compliance programs at both publicly traded and privately held companies.  Tough Cookie 2 is a Certified Internal Auditor and CPA who has faced ethical and compliance challenges in a variety of industries and geographies and recently led a global internal audit team. Their series “Tales from the Crypt: Tough Choices for Tough Cookies” are drawn largely from real life experiences on the front line of working in Integrity & Compliance, and personal details have been scrubbed to protect, well, you know, just about everyone…

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