[00:00:00] Speaker A: Hi, everyone. In this episode, we're going to discuss how calibrating discipline is an important, yet often overlooked aspect of an effective workplace investigation. I'm your host, Bill Coffin, and this is the Ethicast.
[00:00:24] Speaker A: On a long enough timeline, an inevitable outcome of workplace investigations is is disciplinary action. Applying the right level of outcome to an investigation is crucial to a fair and effective ethics and compliance program. It's something that the Department of Justice's evaluation of corporate compliance programs encourages, but doesn't necessarily require, which places it in the realm of voluntary best practices. But what is the DOJ really looking for and what really constitutes a best practice?
With us today to discuss this is Jodi Fredrickson and Eric Jorgensen. Jodi is VP of Data and Services at Ethisphere, where she specializes in implementing corporate compliance solutions for Ethisphere's clients. Her work includes providing clients with ethics and compliance thought leadership, drafting and revising policies that meet the highest ethical and legal standards, and evaluating clients ethics and compliance programs. Erica is a director on the data and services team at Ethisphere and specializes in ethics and compliance program management, specifically the evaluation and implementation of of corporate compliance and ethics solutions. His work includes evaluations of client programs, assessment of programmatic components, and operational thought leadership for clients. Jodi and Eric, welcome back to the Ethicast. It's great to have you on the show once again.
[00:01:35] Speaker B: Thanks for having me back, Bill.
[00:01:37] Speaker C: Thanks, Bill. It's good to be here.
[00:01:39] Speaker A: So, before we get into the details, let's start at the surface. Discipline calibration really sounds like something that's perhaps more suited for a human resources podcast and discussion. So why are we talking about it from an ethics and compliance point of view?
[00:01:53] Speaker C: Well, Bill, I'll take that one. You're correct. Discipline calibration does have a very strong HR flavor. Obviously, discipline is part of the HR mandate. But ethics compliance comes into play for two reasons. In most organizations, when incident is reported to the hotline or something is brought up to be investigated, there's a strong partnership between HR and ethics and compliance. And that's not only the investigative process, the interviews, the findings, and the document gathering, but it's also the post investigation aspect. It's drawing conclusions. It's corrective actions. It's potential discipline and calibration of that discipline. It's really a continuation of the partnership that starts with the initial report and works all the way through the investigative life cycle.
The other aspect is what you mentioned in the introduction, the Department of Justice EECP guidelines, and I even wrote this down. So I got it correct. Section 2, subsection C states, and I quote, does the compliance function monitor its investigations and resulting discipline to ensure consistency?
Now, for those who may be outside the US or not part of the DOJ guidelines, it's a key post investigation element that needs to be taken a look at and to ensure that there's validity in your investigation process.
Probably equally important, it's a good best practice.
Any process that you have, you want to check, you want to balance, you want to be able to take a look at it, make sure that it's valid, that helps not only your investigative process, but speak up in general. It gives employees a sense that there's a process that happens and it's valid, it's done correctly. And finally, if you needed any more reason, it's just building that continued partnership with your good friend and partner human resources when it comes to looking at investigations and the speak up process.
[00:03:45] Speaker A: Jody, I'm curious. In today's world, do you see a lot of ENC organizations actually calibrating discipline?
[00:03:51] Speaker B: So, Bill, this is an interesting question because I want to talk about what we see from a data perspective and then what we see from the program assessment lens.
From a data perspective. In response to the EQ question asking whether organizations are formally calibrating discipline, 84% of WME honorees indicate yes, they are.
But what we actually end up seeing in practice, even among organizations that maybe weren't a WME honoree that indicate in taking that eq, yes, we're formally calibrating discipline. When we really dig in, we see it's really not quite formal, maybe in the sense that ethisphere would expect to see. So is there a calibration of discipline maybe taking place? Maybe, for example, HR is looking at past cases from the prior year that involve similar misconduct, or maybe looking at what they have in their case management system or HRIS system regarding the same, but there's no formality to that process.
What the problem with that is that if you have a change in players, say you have a change in personnel and ethics and compliance or change in personnel in hr, that practice that you have in place is subject to change or it's just subject to falling off their radar. So that's when we talk about calibrating discipline, it's not just having a practice in place, it's formalizing and is documenting it so that if you do have a change in personnel, that practice lives on. Eric, anything to add on that one?
[00:05:26] Speaker C: No. If I could just underline one of the Things that you mentioned is having that formal process in place, documenting it. We're at the end of the year right now and companies all over the world are facing those things that they want to get done before the end of the fiscal year.
And sadly, if it's not documented saying we're going to calibrate discipline, you know what, we'll get to it next month, we'll get to the month afterwards. Other items can take precedence. So documenting it is important.
[00:05:51] Speaker A: What is the DOJ specifically looking for and what really constitutes a best practice?
[00:05:56] Speaker B: Yeah, I'll talk a little bit about what the DOJ is looking for. So, you know, Eric had mentioned just a few minutes ago about how this is specifically discussed in the guidelines. And of course, remember the guidelines are guidance that of course questions that prosecutors should ask. So it's not requirements, but it gives a good indication of what the DOJ is looking is directing prosecutors to look at, which then means this is what organizations should be focusing on as well.
Eric gave one quote out of the ECCP there. Also another question that they direct prosecutors to ask is what metrics does the company apply to ensure consistency of disciplinary measures? And that word metrics is pretty interesting to me because it's not just, well, you know, HR knows what discipline to, you know, what discipline would be issued in response to what category of misconduct they're looking and directing for more.
So when it comes to what I would say, best practice, and then, Eric, I'll turn it over to you to chime in. What I have seen as the most mature at least is having a discipline calibration committee.
Now that that committee would maybe meet for every single grievance that is being lodged, but maybe even for more serious allegations, serious type fraud issues.
[00:07:17] Speaker B: Maybe involving maybe more senior level people.
So you can frame it however you'd like, but what I have seen as the most developed is having that committee having that formalized practice and then looking to see are you actually, are you fairly issuing discipline across.
[00:07:41] Speaker B: Different geographies that your organization operates in? Is the US HR folks acting similarly as those in apac, for example, for the same infractions, maybe looking at metrics like the level of the employee, are you treating a manager different than an individual contributor that committed similar misconduct?
And then this is where I think it gets important.
What about if it's your key salesperson, you know, your key salesperson, were they treated differently than somebody else? So, you know, trying to look to make sure that it actually is being calibrated across different levels and why this is so important is just to echo what Eric said, is it all goes back to culture, right? If employees think that there are different rules for different people, that's going to chill that speak up environment.
[00:08:32] Speaker C: I also think that the calibration committee, though, or a group of people doing the calibration you had mentioned, you know, the consistency in discipline, but also being able to recognize when there's going to be differences, are people treated differently depending on the severity or depending on their position, is being able to explain what does that discipline look like from an ethics compliance standpoint and ultimately from the entire company standpoint.
[00:08:56] Speaker A: Eric, this seems like a pretty big initiative, and I'm not sure a company can just snap its fingers and make all this happen.
What have you seen companies do in order to comply with all this? Like, what initiatives have you seen or would you recommend implementing to achieve a level of best practice here?
[00:09:10] Speaker C: So there's a couple of things I want to mention and bear with me. I'll try to keep it as brief as I can, but there's a couple of key points that I want to make sure that companies are thinking about when it comes to discipline calibration. First of all, first step is just thinking about who's going to have a seat at the table, who's going to organize this. We've been talking about the combination of ethics compliance as well as hr. They're the natural group. Jodi just mentioned a committee.
I would argue that from a. From a working standpoint, it's ethics compliance and HR that are going to gather those statistics. They're going to pull together the information.
But whether it's a discipline committee, a lot of companies have ethics committees. They have ethics compliance committees that help advise the entire function. You could use that committee. And I have seen that committee vus for discipline calibration as well.
The other thing that we've mentioned in previous questions is the documentation making sure that whatever program you put together, you write it up in your ethics committee charter. When you write it up in your procedures, things like, how often are you going to do it? To Jody's point, are you going to do it after every investigation? Maybe you do it on a quarterly basis or a monthly basis, but how often do you get together, who's part of it, what statistics, who's going to pull the statistics? Maybe the SECO should chair the committee meeting that talks about it. So putting together those logistics.
A couple of other things that I wanted to mention. Jody gave some great examples out of the DOJ guidance on what type of statistics to Pull. There are some other statistics or other factors that go into that calibration of discipline. What I've seen things that I've just thought of and pulled from other organizations. Again, what's the financial and reputational severity of the institution?
Was this a policy violation or was it an actual illegal action that, that, that was found?
Does the employee have a past disciplinary record? Is the leadership involved? These are different factors that are going to come into play. And I would argue every organization, every company needs to look at what are they doing? What's the makeup of their company and their organization and what metrics matter to them. What are relevant?
Two last points I want to make. One is let's also not forget about the corrective actions that come out of a discipline calibration. Maybe you are not calibrating your discipline correctly. Maybe your east region is handing out discipline different than your west region. So as an organization, what are you going to do to address that? And I would argue that should be a formal action plan. Who owns the correction? What are the dates it's going to be corrected? Who's going to participate in that? When is it going to. It's like any good project, you're going to, you're going to have some corrective action steps to make sure that errors are corrected. And then finally, also like any good project management, let's make sure we're constantly reassessing corrective action procedures. Maybe at the year, at a yearly basis, you look and say, do we have the right people calibrating discipline? Do we have the right metrics? Are we doing it frequently enough? Are we doing the right conclusions? So taking a holistic approach to discipline calibration to make sure you're doing it right.
[00:12:13] Speaker A: Well, I feel like we've covered an awful lot of ground in a fairly short period of time and I've learned a ton during the course of this conversation. So any final thoughts from both of you on this? There's, there's so much to talk about.
[00:12:24] Speaker C: I'll be happy to go first. I want to make sure that organizations realize they don't have to hit a home run right away. Put together a good discipline calibration process with a small group to start off with. Start off with a small group of metrics and build your way in. Mature your organization, mature your program on discipline calibration. As time goes on, make sure that it's, that it's getting better over time. Make sure that whatever you have today is better than it was yesterday and have plans to make it even better tomorrow. So don't hit a home run right away, but always work to improve.
Jodi, your thoughts?
[00:12:59] Speaker B: Yeah, I think you stole my thunder there a little bit. I would say the same. I would look for further maturation. This is an area that I would say a lot of organizations are still in the early stages and so really thinking about if you don't have a lot in place right now, what can you do to improve it? Really leveraging your cross functional relationships, especially with HR in particular for the E and C folks and really looking to progress and to formalize not just relying on the practice itself, but having the documented backup to that as well.
[00:13:38] Speaker A: Well, Jody and Eric, thank you so much for coming on the program today and talking about this. This has been a fantastic conversation. Very, very fascinating topic and really appreciate the level of depth you went in on all this. So once again thank you so much for coming back to the show.
[00:13:50] Speaker B: Thanks Bill.
[00:13:51] Speaker C: Thanks Bill.
[00:13:53] Speaker A: For plenty of free in depth reports, guidance, documents, articles, videos and more to help you reach ever higher levels of excellence in ethics and compliance, visit the Ethisphere resource
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