A Roundtable Discussion On Compliance Policy Development, Education And Communication

Sunday, October 1, 2006 - 01:00

Moderator: What are the key points you incorporate when developing compliance policy? How are new policies launched within your organization?

Bettman: With any company policy, and especially for compliance policies, our number one objective is clarity. We want our employees to read the policy and to gain a clear understanding of what they can and cannot do. With some policies, we might also want to help employees identify gray areas and the resources they should call on to help with these situations.

How we launch new policies depends on the situation. At a minimum, we post the new policy to the company intranet site, where employees access the current versions of all RR Donnelley compliance policies. That's the base level of communication of new policies, but we routinely do more, depending on the particular policy and its importance. For example, every time we revise and reprint our Principles of Ethical Business Conduct, we mail the new policy to each employee's home. With other policies, we've used cascading communications led by the Human Resources organization or training as key components of the launch.

Grant: Compliance policies are launched in a manner consistent with our communication strategy's goal to touch every employee and to make them mindful of compliance risk with the goal to embed it in the business and make it part of The Way We Work, the signature phrase of our communication strategy.

Getting to the point and being as concise as possible are key points that we consider in our policy development. We focus first on what the legal requirements or policy objectives are; second, we look at what audience we are trying to reach - are the policies general in nature or targeted to a specialized group of professional?

A third feature of our policies is striving to provide practical guidance on how to satisfy the requirements. Sometimes this is achieved through a frequently asked question section that may tackle questions that linger after reading the policies.

Moderator: What are some of the challenges in your organization related to educating people on compliance? What actions have you taken to address these challenges?

Bettman: The biggest challenge we face is getting already busy employees to take time away from their normal job to learn about compliance. It is very hard to find time for any activity other than the day-to-day urgent requirements of the job. We've addressed this challenge by relying on online training (e-learning) as the primary means of educating employees about compliance topics. Online training allows employees the flexibility to take required training courses at the date, time, and place most convenient to each individual.

Grant: The Federal Reserve Bank of New York is an organization of about 3,000 individuals who work in our nation's service. Our staff is divided into many highly specialized technical and professional areas that encompass about 70 different census job families. And so, while we are a relatively small organization, there are a lot of pieces to the puzzle of how to educate a diverse set of professional, administrative and operational staff. Furthermore, in an organization known for its rules systems, the idea of providing guidance on more requirements is not always the easiest thing to sell.

I think there is a fine line between education and advertisement. What's most important is that people are aware of the rules, know how to find them when needed and know who to call. As someone trained as a lawyer, I have to fight the temptation to explain all the nuances of the requirements and avoid long discussions of the intricacies of what we are discussing. Some will say, I haven't quite gotten there yet, but we have a goal of keeping our policies as short as practicable.

Like many organizations, we have looked to e-learning programs to supplement our compliance education initiatives and have looked recently into ways to improve the participant experience by making the programs more interactive, relying upon video segments and decreasing the overall length of the programs.

For training targeted at specific staff or staffs, such as the training for anti-money laundering, we have two half-day training sessions and attempt to train only about 20 employees at a time to encourage participation and to meet the business needs of the operation. Where it matters, it is hard to find adequate substitutes for the time and attention to get something right the first time. Because of our size and the fact that we are mostly in the metropolitan area, we can accomplish some things larger organizations whose staff are more dispersed cannot do.

Moderator: Every management textbook will tell you that communication is important to achieve desired results. What channels of communication does your company use to promote Compliance's agenda? What has been effective?

Bettman: At RR Donnelley, we try as much as possible to integrate the Ethics and Compliance Program into our daily business activities. For that reason, our compliance-related communications take advantage of the same channels of communication used generally in the company (e-mail, posters, brochures, the intranet, and so on). One of the most effective techniques we've used for spreading the word about compliance is to get our message onto the agenda of our business unit meetings or conference calls. A few words of introduction from operating management sets the right tone about the importance of compliance, and also helps employees to understand the connection between our business objectives and compliance.

Grant: I have found that so much of our time is spent on communication, and luckily, because of the scale and geographic proximity of our organization, I can do so directly with a large part of the staff of the New York Fed. I hosted a presentation of our recently released compliance policies for the Management of the Bank at our Head Office, and a subsequent presentation for our staff, both in our auditorium, with a question and answer period. I also took this show on the road, and went with my colleagues to our other offices.

I have made a regular practice of meeting with the management teams of each of the business areas to discuss compliance department initiatives. I also have a Compliance Committee that is a subset of the senior most management of the Bank that I report my progress to. I meet with our Bank president and first vice president on a periodic basis and with pretty much anyone who will listen to me on my soapbox.

There is also the carefully timed e-mail message. Electronic communications is a difficult question for me. I don't want to be a ubiquitous presence in the Bank staff inbox, such that they get so many messages from me that they never know which is important and so they get accustomed to scrolling past them, and they never open them. So I write to introduce new policies and requirements and generally try to be brief and direct our staff to our websites for details.

Moderator: Many Compliance Programs have a space on the corporate intranet for content, but the content varies significantly. Does your company have a website? What content is included and how frequently is it updated?

Bettman: We are actually in the process of completing the first major update to the content on our Ethics and Compliance intranet site. Our new site is better focused on the big picture and setting the right tone at the top. It will include a link to a letter from our Chief Executive Officer that describes the importance of compliance to our business. The new site also has a Flash video with important compliance messages. Other elements of the site aren't new, but we've improved them quite a bit. For example, we've reorganized our policies to help employees more easily locate the specific policies they are searching for, especially our compliance-related policies. We've also added new information about our Ethics Hotline so that employees around the world can easily find the phone number to dial from their country. We don't want to clutter the site with too much information, and we've removed a bunch of extraneous information that appeared on our old site. Our new site is focused on three objectives: to communicate the importance of ethics and compliance at RR Donnelley; to provide employees with easy access to RR Donnelley's Principles of Ethical Business Conduct and the policies and tools that flow from these Principles; and to make it easy for employees to report issues of concern using the Ethics Hotline or RR Donnelley's Open Door Policy.

Grant: The compliance website differs from other intranet sites at the Federal Reserve, in that it contains a 40 second flash presentation that focuses on protecting the Bank's reputation and underscores the role of compliance. It is experienced more like an advertisement but its purpose is educational.

The internal website features a brief statement of purpose that I authored. We also link to our Charter and mission statement.

We keep all of our compliance policies on the website, and frequently asked questions related to those policies. We have all the members of our staff listed with their telephone numbers. We have links to speeches of Federal Reserve officials that discuss compliance related issues. We also have links to articles prepared by our company magazine called "Compliance in the News." Lastly, we have a link to the Ethics Hotline.

Please email your questions about this interview to gerald.kral@duffandphelps.com or james.ewing@duffandphelps.com.