How the Venetian Gondolier Informs Your Compliance Program

This article was republished with permission from Tom Fox’s FCPA Compliance and Ethics Blog.

This is my final travel edition from Venice. If there is one thing that is ubiquitous throughout this city, it is the gondolier, the Venetian gondola boatman. You are never far from hearing their cry of “Gondola, Gondola” to attract tourists for a fabled and romantic gondola ride. One thing I notice about the gondoliers is that in addition to having stout pairs of lungs, they are almost all in very good physical condition. They have to be piloting this very old craft by hand in and around the crowded waters of Venice.

I thought about this as a metaphor for improving your compliance program. As a Chief Compliance Officer (CCO) or compliance practitioner, the more you can get out of the office, into the field, and meet the troops, the more fit your compliance program will be. Any best practices compliance program should have input from the geographies, cultures, business units and corporate functions within the company. It is well understood that a compliance procedure that works well in the U.S. may not work in Indonesia.

This means that a CCO or compliance professional needs to understand how the cultures in your organization work and then create a compliance program to fit those needs. It does not mean a company can continue to do business with corrupt intent, but if there is a culture of gift-giving in a geographic area, you should determine a way to continue such courtesies, within the context of your overall compliance regime.

Channeling both my inner Jay Rosen and the FCPA Guidance, you should also work to train your employee base on your compliance protocol in local languages. Even in one country, this could mean translating into more than one language; for instance, in Spain, you may be required to train both in Spanish and Catalan, if you have operations in the Catalonian region.

Conversely, to make your compliance program more robust, you should not simply believe your own story or — even worse — your own propaganda about the effectiveness of your compliance program. Simply because a country manager says something is true does not mean that it is true. You also have the opportunity to get out of the home office and visit international locations. This is the best way to find out what is going on in the field. In the compliance arena, your primary sources are the employees in your own organization.

In addition, by getting out of the office, you can create relationships with company personnel. Bruce Rector, writing in the Houston Business Journal in an article entitled “All good businesses are built on personal relationships,” theorizes that “all business is, in the final analysis, about people – and therefore about relationships.” At the end of the day, compliance, like business, is about people, and that means it is about relationships. But perhaps more important is the development of personal relationships.

If you meet with your international sales team, my corporate experience is that they will appreciate that you took the effort to travel to train them or meet with them. They are also more likely to tell you things in person than they would via email or over the phone. One of the criticisms of anonymous hotlines and other internal reporting mechanisms is this lack of the personal experience that can lead to mistrust, if not distrust. Getting out into the field and meeting folks can go a long way to overcome this frailty of human nature.

Finally, by getting out of the office and working directly with other company personnel, you can set expectations appropriately. This is true for the compliance practitioner whether you are dealing with third-party vendors in the supply chain, agents and other foreign business representatives, your employee base, senior management or the Board of Directors. You must set the expectation that if something occurs that materially impacts these expectations, you will immediately communicate with the person or business affected. For, as Rector believes, “nothing will derail a business relationship – or any relationship, actually – more than blindsiding someone with bad news that has been withheld for some time.” By properly managing the expectations of the company’s compliance group with the relationships that you have established in the company, you will make the doing of compliance less stressful for all involved.

I hope you have enjoyed reading my Venetian travel posts as much as I have enjoyed bringing them to you. My observation that gondoliers tend to be physically fit ties directly to the job they have to do, propelling a gondola. Yet as a CCO or compliance practitioner, you can get out of the office and make your compliance program more robust and get it in better shape.

This publication contains general information only and is based on the experiences and research of the author. The author is not, by means of this publication, rendering business advice, legal advice or other professional advice or services. This publication is not a substitute for such legal advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified legal advisor. The author, his affiliates and related entities shall not be responsible for any loss sustained by any person or entity that relies on this publication. The author gives his permission to link, post, distribute or reference this article for any lawful purpose, provided attribution is made to the author. The author can be reached at tfox@tfoxlaw.com.