FCPA Compliance and Ethics Blog

May 5, 2014

Hitting the Ground Running – Your First 100 Days as a New CCO

FDR Fireside ChatThe first 100 days. Franklin D Roosevelt’s (FDR’s) first term is the standard by which all other Presidents are measured for their first days in office. Why? It is because not only did FDR hit the ground going full speed but also passed legislation, which changed the shape of America for years to come. While the first thing he did was declare a Bank Holiday to save the nation’s banking system, he also passed significant legislation to try to stem the effects of the Great Depression. These bills included the Agricultural Adjustment Act, the Federal Emergency Relief Administration, the Civilian Conservation Corps, and, finally, the National Industrial Recovery Act. He also enacted the Truth-in-Lending and Glass-Steagall Acts to help regulate the stock market, whose collapse had heralded the economic downturn. Even if these acts did not turn the tide of the Great Depression, it gave people hope because at least it appeared FDR was doing something to fight the economic calamity.

Now imagine that you finally have been able to secure a new position as Chief Compliance Officer (CCO) in the compliance field. Every company believes that they are ethical and that they certainly do business ethically but what are some of the things that you can do in your first 100 days? Hopefully you will not be dropped into a corporate situation as dire as the one FDR faced for the US in 1933 but the reality is that many new heads are still judged on these mythical first 100 days.

In the March-April issue of the Red Flag Group’s Compliance Insider magazine, the issue of what you can do to help yourself to succeed in a new role was explored in an article entitled “The First 90 Days in Compliance”. The article uses the book The First 90 Days by author Michael Watkins as a starting point to provide “systematic methods you can employ to both lessen the likelihood of failure and reach the break-even point faster.”

Prepare Yourself

The key is to try and make a clear transition. The best situation is if you can take some time off to prepare yourself between your old and new positions. You should try and use this time to learn more about your new employer and supplement the information you were able to garner during the hiring process. If you cannot take time off, the article suggests studying every night to prepare for your new position. If you want to hit the ground running, you have to be ready to do so.

Accelerate Your Learning

You will be required to learn quite a bit on the job, very, very quickly. The article suggests some key areas for immediate inquiry, which include your new company’s investigations and hotline issues; the internal audit documents relating to compliance; the annual reports for any notes about investigations or other Securities and Exchange Commission (SEC) issues; and a general review to see what is happening the industry to see if there are ongoing Foreign Corrupt Practices Act (FCPA) investigations or recent enforcement actions. The article also suggests meeting up to 50 colleagues in your new company to “Interview them about the company’s existing compliance” program. From these interviews, you can reach out to begin to build a network for further interviews.

Match Your Strategy to the Situation

Here the article suggest that you need to first identify the highest compliance risks and then try to focus on the risks which are not being managed effectively. They note, “It is your role to quickly work out where the most risky practices are and which risks will have the biggest effect on the business…The part that is more challenging is managing risk while focusing on the areas that have the biggest business value. Business value can be measured in country value, profit or reputation. It can also be measured in reducing potential exposure in fines or prosecutions, or growing revenue and profits.”

Secure Early Wins

You do not need to try and fix the company’s compliance program in the first 100 days. But you do need to find a way “to identify opportunities to build both personal credibility and credibility for the compliance function as a whole.” The article suggests taking the issue, which seems to have the most “noise” and contributing towards resolving it. But some of your work may come with instituting good process, as “A large amount of early wins can be as simple as the new compliance team focusing on adding value, removing obfuscation and helping to grow the business, rather than being a roadblock.”

Negotiate Success

One obvious thing to generate success in the corporate world is to have a good relationship with your boss. The article suggests you should have important conversations around “expectations, working style, resources and your personal development.” To facilitate these discussions the following points are posited:

  • There is no value in trashing the existing compliance program.
  • You need to drive the discussions with your boss.
  • Your boss is looking for solutions, not problems.
  • Your boss is not interested in running through your checklist of things to do.
  • Make sure that you connect with the people that your boss values and admires, such as their mentor.
  • Most importantly, set expectations.

Achieve Alignment

If you have not done so through the hiring process, you should have a clear understanding of what compliance means at your new company and what your role will be. While you were hired for FCPA or other anti-bribery legislation compliance, does compliance means something broader in your new role?

Build Your Team

You will probably be called on to make some difficult personnel decisions in this area but one that is absolutely necessary. As the article notes, “your ability to select the right people for the right positions is among the most important drivers of success during your transition and beyond. You also need to hold onto the right people. The focus for every solid manager is to focus on the best people and only those people – the rest should quickly be managed up or out.” If compliance is seen as ‘The Land of No’ populated by one or more Dr. No characters, it is time to make a change and the sooner the better.

Create Coalitions

One of the biggest keys for any successful compliance program is the ability “to influence people outside your direct line of control. Supportive alliances, both internal and external, are necessary if you are to achieve your goals.” You will need to try and identify those persons and develop relationships, then create coalitions with them. This means you will need to get out of the office and get overseas as quickly as possible. While your manager, be it the Chief Executive Officer (CEO) or other, will probably want you in the office, you need to get out of your office and build relationships in the field.

Keep Your Balance

These first 100 days will be a time of very high stress. This may well be compounded by your travel schedule and working very long hours to try and fulfill the concepts discussed herein. The article advises, “The right advice-and-counsel network is an indispensable resource. Use your network of mentors, coaches and friends to discuss your part at the company and what you have been experiencing.” The key is to use whatever resources are available to you during your first 100 days.

Accelerate Everyone

Just as FDR accelerated his actions during his first 100 days, a large part of his success was that he accelerated those around him. You should take this key component of FDR’s success to heart in your new role. Get all of your “direct reports, bosses, and peers – accelerate their own transitions. The fact that you’re in transition means they are too. The quicker you can get your new direct reports up to speed, the more you will help your own performance.”

It is difficult to imagine today a harder situation than the country faced when FDR came to power in 1933. The task must have seemed overwhelming. Starting a new compliance leadership position at a new company can seem equally daunting. The Compliance Insider article provides an excellent framework on how to not only think through your steps going forward but also how to execute them.

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, 2014

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