[00:00:00] Speaker A: Hi everyone. Today we're going to talk about why boards are looking for more from their ENC teams and how you can use this to build massive value for your program. I'm your host, Bill Coffin and this is the Ethicast.
More than ever, boards of directors are looking to ethics and compliance teams for high quality strategic guidance to help manage risk while developing sustainable growth for the enterprise.
This creates opportunities for E and C leaders to provide their boards with more data rich analysis of challenges and opportunities. It provides a way to turn the one way information transfer of simple reporting into a much more valuable two way conversation. And perhaps most of all in it creates an opening for ENC leaders to leverage the immense transformative power of AI to supercharge the value of their programs.
But all of these things require a shift in mindset and a different approach to traditional E and C tradecraft. But for those who embrace this evolutionary moment, their efforts to advance business integrity within their organization are about to take a quantum leap forward.
With us today is Laura Jacobis, a strategic advisor in the area of integrated risk management and at Metra Tech, a global technology organization that aids corporate legal risk and compliance and HR professionals in enhancing productivity, controlling expenses and mitigating risk.
Laura brings deep hands on experience in design and implementation of corporate compliance programs that genuinely resonate with company values and employee behavior.
Prior to Metra Tech, Laura spent much of her career building, sustaining and enriching both legal and business functions at high tech companies including Cisco Systems and Juniper Networks. She has consulted in the area of ethics and compliance to many organizations and is a published author in the field of business ethics. Laura, welcome to the show.
[00:02:01] Speaker B: Thank you so much. Bill, thank you for having me here today. It's a real privilege to be here with you and to be part of.
[00:02:06] Speaker A: This Ethicast Board reporting has become a topic of pronounced interest within the business integrity space, especially over the last year or so. So can you talk about what you're seeing here? And in particular, can you shed some light on why you think boards might be digging deeper in their interactions with ENC and simply asking more of their ENC teams?
[00:02:27] Speaker B: Yeah, absolutely. I spent a good part of my days at Metra Tech actually talking with compliance and ethics professionals and risk professionals, and I'm finding that this really is a hot topic. C cos and CROs are certainly getting a lot of feedback from their boards who are wanting to better understand how the CECO obtains data that they give to the board, whether or not that data is actually truly reflective of the risks in the organization and the state of ethics. And they also want to know what's being done to discover issues and mitigate top risks. I think there are a couple things that are actually driving this. I think primarily we have seen several instances of executives in the news, executives acting badly. I know you and Erica did a great deep dive into Nestle recently. And I think we've all seen the Astronomer Jumbotron scenario.
Those are tough to see. And clearly the boards must have had some level of surprises in each case. And I think social media just puts a magnifying glass on every ethical problem. So certainly boards are concerned and very concerned about reputational and other types of harm. I think another reason that boards are leaning so heavily on secos right now is that they're concerned about a number of global issues. So global economies are in the news, geopolitical rivalries, trade and tariff issues, cyber threats. There's just a convergence of issues and I think a lot of nervousness right now on the part of boards. There also is, I think, a confusing and continuous set of regulation changes, especially here in the US And I've heard some boards say that they are concerned about how the US Regulation changes impact global compliance programs. So another thing that's weighing on them. And then I think, you know, to be honest, there's some level of skepticism that boards have made in various programs. So certainly we all put in place DE&I programs or DEIB programs, and we're seeing those being eliminated now in some sense. And so they have questions about what will actually stay put and what's worth investing in.
That's another conversation for a different day. But I certainly see some level of stress there as well. And then I think there's also a belief on the part of some boards that ENC budgets should be lower now since we're having so many reg changes. I actually think personally that ENC budget should be higher for a number of reasons. But again, a conversation for a different day. And then finally, I think there is so much being pushed in terms of AI and AI conversations.
AI and agentic AI, how compliance can make use of those. And I think that boards really want to understand that better. And so they are. They're leaning on ENC Professionals also think it's a good thing that boards are leaning on ENC right now. But this is where you want to have a really strong relationship with your board and be well placed in the organization to be able to have those critical conversations.
I do still see an awful lot of ENC executives running compliance organizations and Reporting directly to a gc, a CLO, or even a cfo. And I know that the DOJ feels that that's problematic.
I believe you really do have to have a direct line to your board to be able to have those open and honest conversations.
[00:06:13] Speaker A: Ethics and compliance is an increasingly data driven discipline. So how can ENC leaders make the best use of data so they can elevate periodic board reporting into an ongoing and strategic conversation with the board?
[00:06:27] Speaker B: No ENC professional wants to be thought of as just the police for the broader employee population or just the reporter of data for the board.
But in my work I've seen that those strategic conversations really only happen, or really only can happen after you have some level of basic and dependable reporting that's already in place for the board.
It's really nearly impossible to have an ongoing trusting relationship if you haven't yet done the basic work in getting them to trust you and showing them that you actually can pull data together effectively and efficiently.
So I think, you know, part of the work upfront is framing your board reporting or your board dashboard so that the board understands what they can expect every quarter from you and they'll know what anomalies or other issues arise and what to ask about when you're in front of them.
And I do see and hear a lot from ENC professionals really wanting to nail down that basic reporting, knowing that that's essential. But it's hard to know where to start. So my suggestion to them is typically to step back and then be able to take a broader look at all the different tools and processes that they have in place in the organization.
In looking at that, evaluate the efficiencies and be honest about where those exist in the organization.
Do some testing on data quality. If you are in a position where you literally have to move data from one system to multiple other systems and reformat reporting, can you really ensure data integrity? I think that's a big question right now.
Question your audit trails and see if those really are valid. Determine where you have silos. That word silo is probably the top word that I hear. If I took a count of words that I hear every month, silo would probably be the top one, and bored certainly. And then understand the organization's ERM capabilities and processes. And this is actually a huge trend that I'm seeing. So more ENC folks are coming to the ERM table. And a year ago even I wasn't, I wasn't seeing that. So that's really an interesting change.
That whole process of understanding and Getting insight into the tools and the processes you have, the things you might be missing, and whether or not you really have some form of connected solution. Once you've laid that out, then you can figure out how you can collect the metrics that you want to collect and track those in your board reporting.
I have seen a lot of cases where CCOs or CCOs don't understand their processes and product solutions and how to get insightful data. And so they end up having things on a board report like, you know, a metric that says 5,000 employees did our antitrust training. And I always question, what does that actually say? I mean, it sounds really good. It sounds really good that 5,000 people have done your antitrust training, but is that an improvement?
Did the training actually work?
How many people haven't done the training? What's the story you're trying to tell the board? It's a true story, but what is the story that you're trying to tell with that metric? And so I really encourage sitting down and figuring out what are those things that will tell the story of your compliance program and actually demonstrate continuous improvement. Because at some point we all need to be able to do that.
I think it's not a bad thing that the CCOs are choosing 5,000 people who've done training as a metric. I just think that's an easy one. Right? It's an easy metric to find and actually report on. But I think we can get past that as an ENC community.
And the way to do that is really just with better products and better processes and then really some collective cross functional trust, which is incredibly essential to build. I know we're talking about really trust with the board and broadening that relationship and making it more robust. But a big part of that is also just having that, that cross functional trust. So I would say once you understand your products, your processes and your metrics and you've established that reporting, you've run it past the board, they understand what they're going to get. And then we can see that that insight driven data and that consistency of board reporting does enable trust with the board. And that's when the relationship actually does have an opportunity to grow.
[00:11:11] Speaker A: Laura, if I can ask you a follow up question. I know a lot of ENC folks, they get really hung up on trying to find out what the right tools for their program are. But beyond that, can you talk about how the right tools can help you develop the right skills to ensure that your program really succeeds?
[00:11:26] Speaker B: I'm often on a series of calls with customers. So we'll start out talking with a Chief Risk officer who's asking us about erm. But a week later we have another conversation with the same customer and the SECO is added and then the head of HR is added, the GC is added. And it's really kind of enlightening, you know, fascinating for me to see how everyone together is realizing that they need data essentially from the same bucket, right? They need, they all need that same data. They just need it in a different format or they need it at a different level of detail.
And my experience is that the ENC folks seem especially surprised that they can make use of ERM data at some level and that, you know, that that has been really eye opening for me and, and for them as well.
I'd say that given the complexities of compliance now and with data really at the forefront, having interconnected reporting, interconnection in some way with the tools and processes that you have is really the only viable method to ensure appropriate visibility for the board. You know, there are tools and solutions that enable basically the foundation of any compliance program. For me, that's thinking about policy management and having a system for that, training and having a system and metrics for that, all of the monitoring that you're doing. So that includes having a hotline, any surveys that you DO, disclosure processes, etc.
A case management system doing investigations and being able to track those and set metrics around those and then ultimately providing that board reporting. So that's kind of your baseline compliance system.
And if you have all of that in place and that data is simple to integrate and extract and you're able to tell a full story, right? Really to be able to show in one picture, continuous improvement. If that's done, then you're really and only then able to focus on the relationships in the organization and with the board. The values, the cross functional alignment, and those also are really key to a compliance program's success. If you get the products, the solutions, the processes right, then you can actually focus on everything else that's critical to an organization having an effective compliance program and running with integrity.
[00:14:04] Speaker A: Laura, when I speak to E and C leaders who have a lot of experience successfully building a strong relationship with their boards, they always talk about how important it is for them to learn the business. So I'd be curious to know what your recommendations are for how E and C professionals can learn their business with an eye towards using that knowledge, not just to perform their immediate duties well, but to earn that, that trust you speak of as A strategic partner to their board.
[00:14:29] Speaker B: Yeah, that's a. That's a great question. I hear this a lot. Also, I think that there's some belief that it's a given if you're running ethics and compliance, that the board or even the rest of the executive team will reach out to you when there are challenges to solve or even just for basic strategic planning. And compliance should always be part of basic strategic planning of an organization. I mean, think of every. Almost every strategy move involves some level of risk, and compliance should be ready for that, whether that move happens or not. At least to be ready for that and to be part of those conversations, I think is incredibly essential.
I would say, from a, you know, from a personal perspective.
I was lucky in many ways early in my career because I actually left legal. I dropped my license for some period of time and I went to the business side. So literally out of legal into business. And I had an incredible opportunity to work in sales strategy. Honestly, the best thing I ever did, I continued to some grooming with the same company. I went into marketing, then into finance, into customer advocacy, et cetera. And for a number of years, my big aha.
Continuation of moments was how much I hadn't known about the business while I was sitting in legal. I thought I knew a lot. I thought I knew how the business operated and how decisions were made.
I really didn't have a clue. So I learned a lot about where my knowledge was shy. And I relied on and leaned very heavily on a mentor on the business side to help me try to figure out things that I didn't understand and how things really did work. At one point, I even took a finance class to boost my knowledge. Terrible for me because I still can't balance a checkbook, but I tried.
And then I moved into another legal role ultimately. But that time I spent on the business side, even today, informs the work that I do. I think it's really critical to understand what everyone else is doing and how they think, think about, even risk.
In my spare time, I actually teach in the compliance and ethics space. And students always ask me questions about what the trick is, you know, to move up in an organization, they want to take the right LinkedIn learning class or they want their next degree to be the right degree.
But I am thinking about this. Is that the class or the degree?
I think we actually need to want to continue to learn on the job. The be all and end all isn't getting the job. And so for me, I think it's important to make sure that we work somewhere that most importantly reflects our own personal values and supports ethics and compliance. And then an organization that encourages shared learning and growth from mentors and peers. And that doesn't mean there has to be an official professional development mentor program, but that it's supported. You have to respect the executives in the organization and the board and you have to feel that you're respected and valued. And if you don't, I think you really have to take another look at that list and figure out if you're in the right place. But all of those things together, I think help us to want to be engaged and to learn more about the business.
I would also say that part of what's innate about learning or leading an ethics and compliance program is that you generally have to rely on a very large cross functional base of people, many times matrix, so you're working with them anyway. And that creates this really incredible opportunity to learn what the rest of the business is doing if they're risk aware generally and if they're actually living the values of the organization.
I find that in ethics and compliance, we many times come in and tell employees what they need to do for us, fill out this maturity scorecard. Sometimes we leave out the why and sometimes we leave out how valuable their roles are to actually protecting the organization.
But if we take advantage of those moments with them to get to know the business better, to understand their opinions and we're gaining data about the business and we're also helping them to support our efforts.
I would also say that I have learned that employees are incredibly smart and intuitive and they know if we're really interested in them and what they do. And I think it's important to spend the time with them and really get a different perspective. There are incredible opportunities for relationships in the ethics and compliance space. Employees all over the organization and even board members who usually have some incredibly interesting stories that we can learn from. And I think that's one of the reasons that work in this area is so engaging. We literally get to work with everyone within an organization potentially. And there is a lot of learning in that.
[00:19:43] Speaker A: Well, speaking of learning, I learned an awful lot speaking with you today, Laura. So thank you so very much for joining us on the program and for sharing your insights on this topic. I think our audience is going to get an awful lot out of it. I know I certainly did so again, thank you so much for coming on.
[00:19:55] Speaker B: Thank you so much for having me here today, Bill. I really appreciate it.
[00:19:59] Speaker A: To learn more about how Laura and her colleagues at Mitra Tech can help connect and empower your organization's core departments via fully automated compliance technology, AI driven analytics, and seamless integrations. Please visit www.mitratech.com that's M I T R-A T-E C H.com to appear as a guest on this program and share an ethics and compliance best practice or success story, please drop us a
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That's all for now, but until next time, remember, strong ethics is good business.
