by Cydney Posner
A 2016 survey conducted by the Society of Corporate Compliance and Ethics and the Health Care Compliance Association of their members found that compliance professionals were well worth the cost. (But really, would you have expected them to publish a survey showing that their members and programs were ineffective?) Snark aside, the survey looked at the incidence of preventing misconduct, concluding that “over time the vast majority of compliance programs are finding that they are regularly not just managing compliance incidents, they are preventing them.”
More specifically, in the survey, 83% of compliance professionals reported that their programs had prevented one or more incidents in the last two years, including 95% of professionals at companies with 5,001 to 30,000 employees and 89% at companies with over 30,000 employees, but only 78% at companies with 5,000 or fewer employees.
Generally, the range reported was one to ten prevented incidents in the last two years, with 46% reporting five or fewer prevented incidents and 22% reporting six to ten prevented incidents.The number of prevented incidents seems to have varied with the size of the organization: 72% of small organizations (< 5,001 employees) reported ten or fewer prevented incidents (plus 12% reporting zero), 48% of organizations with more than 30,000 employees reported eleven or more prevented incidents and 12% reported over 100 prevented incidents. Of these large organizations, 6% reported no prevented incidents. (In those instances, does that mean the compliance professionals didn’t do their jobs well or that the employees were already well-trained?)
How effective are compliance audits? Overall, 56% of compliance professionals responded that compliance audits had uncovered wrongdoing at least “some of the time,” including 7% that reported uncovering misconduct “a great deal” of the time. At larger companies (>30,000 employees), 69% of respondents reported revealing wrongdoing at least some of the time. The survey authors are quick to point out that this data does not reflect the discovery of gaps in processes or possible deterrence effects from the conduct of audits.
How useful is employee training in compliance issues? Generally, 82% of compliance professionals reported that training led to “some increase” in inquiries and reports about the compliance topic, with 14% indicating a large increase. When asked whether training had ever led to an employee’s “coming forward to reveal potential misconduct that subsequently led to actions designed to prevent that misconduct from happening or continuing,” 76% responded positively. At large companies (>30,000 employees), 89% reported that training had resulted in an employee report that led to action that prevented or stopped wrongdoing.
In this article in the WSJ, the CEO of the SCCE interpreted the survey results as showing the importance of encouraging employees to take action when they see something that may be improper. Moreover, he advocated “interview[ing] people a week after giving them training and specifically asking them if they have seen activity of any kind that shouldn’t be happening,… as some employees are reluctant to report wrongdoing but won’t lie about it if asked directly. ‘There are people just wishing that somebody would ask them if they’ve seen any wrongdoing because then you give them an out….They don’t feel guilty about reporting an issue if they can say, ‘They asked me and I couldn’t lie.’”