Language as a Long Term Compliance Strategy

I constantly rely on Jay Rosen and his team at Merrill Brink for translation and other language related services in the compliance portion of my work. (Yes I do practice law and compliance for a living; I blog for gratis.) For not only am I required to help evaluate documents in a foreign language which need to translated into English but often I need a foreign language version of compliance related documents that I create, from third party questionnaires to contracts to Foreign Corrupt Practices Act (FCPA) training materials. While I still tend to think of language as a tactical issue, Jay has long striven to have me see it as part of a businesses overall strategy.

I think I may have finally seen the light that Jay has been preaching to me over the past few years when I read an article in the September issue of the Harvard Business Review (HBR), entitled “What’s Your Language Strategy?” by Tsedal Neely and Robert Steven Kaplan. The authors posit that language should bind not only your company’s global talent pool but also your company’s vision. After concluding the article, I now understand how language is a strategy to help inform your compliance program as well. This is because just as “Language pervades every aspect of organizational life” the authors believe that companies “often pay too little attention to it in their approach to talent management.” I would add that is also true in the compliance function.

The authors believe that problems revolve around potential “blind spots regarding language.” They write that company leaders pay too little attention to the role of language when “hiring, training, assessing and promoting employees. This can lead to miscommunication and friction, especially among team members who collaborate across borders.” While the authors point that a company’s competitiveness that may suffer, I would suggest that a company’s compliance function could also suffer. The authors believe that a company should align its language strategy with its overarching priorities. Further, by building “language skills and cultural awareness throughout your organization in order to acquire and develop the kind of talent you need to compete globally and locally.” The authors believe that by paying attention to this issue, your company can potentially turn “vulnerability into a competitive strength.”

The authors identify five key points which a company should evaluate regarding language. I would also add they relate directly to any international company’s anti-corruption compliance function whether under the FCPA; UK Bribery Act or other anti-bribery regime.

Hiring and Training

Here companies need to understand how candidates might come across in the interview or other pre-employment evaluation process. While a candidate with multiple language fluency may overshadow deficits in other critical areas, it may also be a problem because as an evaluator, “you may need to accept some limitations on language capabilities and be prepared to provide training to meet both global and local language needs.” But even if you get pass this first hurdle the authors identify a follow up problem in this area; that is, after hiring and/or promotion. They state, “Another blind spot is a tendency to over rely on external lateral hires with a certain degree of language skill to fill midlevel roles rather than hiring and grooming outstanding junior candidates with the capacity and motivation to learn new languages. While the latter approach may initially take more time, companies often find that entry-level hires ultimately become their best leaders, because they have been trained from an early stage in company culture and practices. Defaulting to lateral hires can make it more difficult to build a cohesive culture—those recruits have been trained elsewhere and may have trouble assimilating.”

Evaluating Talent Accurately

Even if your company does improve its entry level hiring practices and provide training to assist new employees in their language skills, you still need to make accurate performance evaluations. Here companies may get into trouble because “Language agility does not necessarily spell high performance.” The authors point to the need for a robust process to assess skills and attributes which allows a company to “look beyond verbal agility when gauging performance. It’s a reality check, a way to make sure that you and other leaders are not unduly swayed by fluency.”

Rethinking the Role of Expatriates

One of the key areas in the compliance field is to develop local compliance talent and expertise. This is not only because “expatriates may not be familiar with the local language, culture, and business practices, they can bring knowledge of organizational culture along with an understanding of the company’s products, processes, and systems.” One of the roles of any compliance manager, particularly an ex-pat is “to focus on developing local talent and ensuring that indigenous professionals begin to play leadership roles in the local businesses.” Equally important is to “think about the people you’re choosing to send abroad. To build a strong team of local leaders, it’s critical to give expatriate assignments to your best people—not just to solid contributors who happen to have the right language skills and are more easily dispensed with at home. Otherwise, you may find that your firm’s global offices fail to attract, develop, and retain the strong indigenous talent they need for high performance.”

Managing Communications on a Global Team

Most of the company’s I have worked at hold all their communications in English-language on a company wide basis. Of course I thought this was great. But the authors note that “managers often unwittingly position native speakers of a lingua franca as “winners” within the firm; consequently, nonnative speakers experience a substantial loss of power and status. If companies don’t take such issues into account, they can cause otherwise talented and engaged professionals to underperform and even withdraw.”

The authors believe that managers need to understand which of their employees are comfortable with the second-language proficiency and those who may not be so comfortable. They provide specific guidance as follows, “Global managers must deal directly with such issues to promote productive global cooperation. They must be sensitive to how employees of varying language proficiency are interacting. The goal is to make it easier for native and nonnative speakers to establish trust and communicate effectively. Managers’ observations should include the following: Who attends meetings? Who speaks up? Are the best employees contributing, or is language getting in the way? It’s then important to facilitate meetings and calls so that nonnative and native speakers get equal airtime. Often this means coaching primary-language people to speak less and second-language people to speak more. It also involves setting clear agendas up front, considering the mode of communication, and thinking through meeting choreography in advance.”

Building Cultural Awareness

The authors conclude by reminding us that language fluency does not always equate to cultural fluency, as “too often leaders underperform because they fail to adapt their management styles and practices to fit a multicultural environment. For them, understanding the cultural background of each team member, the role of the company, its products and services, and the customers it serves within various cultural and regional contexts is as essential as learning to conjugate new verbs.” They believe that “Managers should be held accountable that language and cultural skills are developed throughout their organization.”

The authors’ piece is chock full of ideas, insights and issues for a Chief Compliance Officer (CCO) or compliance practitioner. Any company doing business internationally is going to have the issues that the authors discuss in their article. The compliance function has all of these issues in spades because if you need to consider the FCPA, it is because you are doing business internationally.

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