A compliance & ethics (“C&E”) program can mean different things to different people. But if you picked one that came to mind first, it would likely be training. This is viewed as a key to reaching employees. It is always on the list of program elements. And, whenever government stumbles into trying to mandate compliance programs, training is always there. California, for example, in its experiment in requiring compliance efforts to prevent harassment, relies on a mandate of a set number of hours in a set time period.
But although training has long been a landmark of C&E, it is still worth examining some fundamental, motivational questions about training. These include:
- Why do any kind of training, ever?
- Why do companies do C&E training?
- Why do people take training?
[Note] I use the term “employees” to cover anyone the company may choose to train, which might also include third parties, and of course, executives and especially the board.
Why do any kind of training?
There often seems to be an assumption that training is done for one reason: to transfer information to employees. So if there is a class about the FCPA, the training might explain its origin, its purpose, what it says, and what its penalties are. There might even be a test to see what attendees have learned. If the only purpose is to transfer information, then one might suggest allowing employees to test out of the training, so they do not have to duplicate the learning process.
But this misses another important purpose of training: motivation. Employees may know, intellectually, that the FCPA prohibits bribery. But is this actually important to them? After the training will they care? Will the training inspire them to comply? Or will it scare them into following the law? And another essential point: will it cause them to voluntarily report their own misconduct or the misconduct of others? Commentators who suggest “testing out” may understate the motivational part.
Training may surface issues that had not been front of mind until a person was reminded about the topic by the training. This is especially true if the training is interactive. In my time working with companies in compliance training, I have personally had the experience of people raising compliance issues as a result of the training. This is a topic we have covered in another article, “Training as a form of auditing, monitoring and assessment?”
Information and motivation serve essential goals of training. But there is also a third purpose for training: skill. The skill part can come in, for example, if you are training on how to do something that requires experience in performing a task to learn it.
Here is an easy example. I am a ballroom dancer. You can have me read a book about dancing. You can motivate me by letting me see how much fun it is. But if you don’t have me actually take the steps, make mistakes and correct them, I won’t be a dancer.
In the compliance field if you are to be an investigator it is not enough to remember information on how to conduct an interview or be highly motivated. It is also important to practice this and learn in that way.
Why do companies do compliance training?
It might seem obvious at first why companies do compliance training. The simple answer might be to stay out of trouble. But the analysis can go further than that, which can also inform what type of training is done.
Training may be required by a customer. For example, someone retaining a foreign agent to obtain business may require that the agent’s employees receive anticorruption training.
Companies may also do training to maintain ISO certification, for example, under ISO 37001 on anticorruption and ISO 37301 relating to general compliance programs.
Companies may require training for their C&E professionals so that they have the appropriate skill level. The company may also want its C&E professionals to be certified, and thus they would need training for programs like the SCCE and HCCA certifications.
Companies who consider this more deeply will also see that training is an important tool for developing a positive corporate culture. For this the standard of effectiveness is much higher, since poor or insincere training can have the opposite impact. It may well be, for example, that poorly developed harassment training can have the opposite of the intended effect. You want people to feel good about the company, and also view themselves positively. This can improve morale and productivity and the company’s ability to recruit top people.
Another potentially very practical business benefit from effective training is to save the company money. For example, an effective C&E program can reduce fraud. The ACFE, in its widely reported annual reports, indicates that companies lose 5% of their gross revenue to waste, fraud and abuse. Effective training that improves the culture could reduce this loss.
Companies also do training for external purposes. The most obvious is to impress the government if there is ever an investigation by enforcers or regulators. Government agencies that recognize C&E programs help drive this process. As a motivator, however, this works best when government is clear that box ticking does not help, and that companies must also measure the effectiveness of training.
Companies may train board members and executives to help protect them under the Caremark case standards and to help them meet their fiduciary responsibilities. Companies may also seek external recognition for the company, such as being on “most ethical companies” lists.
Training could also be seen as a sign that the company wants the employees to learn, add more value and advance in their careers. It can suggest an investment in the employee – that the company thinks they have potential.
Why do people take the training?
What motivates people to take training? They may need to, or they may want to, or both. For example, professionals typically have continuing education requirements. They could (although not all do) see this as a positive element, choosing courses that they perceive as adding value for them.
Employees may have compliance training mandated. C&E professionals know what this means in terms of tracking and perhaps threatening employees. Companies may make completion of the training a factor in employees’ performance evaluations.
For skill training the motivation may be stronger, because they need it to be able to do whatever the topic is. As the story of motivation has been told, if you are training people on how to correctly pack and then deploy a parachute, you don’t need to worry about motivation (at least, if they want to jump more than once!). Driver training is another example where people are inherently motivated to take and absorb the lessons of the training.
People may take training for a number of other reasons, such as curiosity, or to improve an existing skill, or to gain a business advantage. In a personal example, early on as an antitrust lawyer I learned to use the “coffee urn” message. I would tell sales employees this piece of advice:
If you are ever in a room with competitors (and yes, this does happen), if anyone starts talking about prices you are to stand up, loudly announce that this is improper and that you will not participate. On the way out of the room you knock over the coffee urn! If people remember nothing else about that meeting, they will remember that you left. And embarrassment beats serving time in federal prison.
I learned to use an attention-getting and memorable hook; this always drew out a reaction, and my experience was that people remembered it.
Conclusion
What is the conclusion from this? There is more to training than people often assume. It is useful to look at it from a broader perspective, including understanding the “whys” behind it.
