By Blandine CORDIER-PALASSE, Trophées d'excellence de l'éthique des affaires 2019 - Revue RH&M n°76
Tougher requirements and no-holds-barred penalties
Ethics and governance are now becoming priority issues for executives and boards. For the first time in 19 years, more chief executives were dismissed in 2018 for ethical breaches than for poor financial performance or conflicts with their boards1 . The subject is still very topical. The CEO of McDonalds, who had turned the fast-food giant around, was sacked at the beginning of November for having a consensual relationship with someone in his company. Faced with increased demands from their directors, companies need to strengthen their governance and compliance infrastructure. But how? In partnership with the Masters in Business Law and Ethics at the University of Cergy-Pontoise2We have analysed the governance policies of French groups in these areas and identified 10 best practices.
As a preamble, it's worth noting that what they have in common is that they have strong values that have an impact on behaviour, that they accept this and that adherence to the corporate culture is a key point from the moment they join the company and on a day-to-day basis. Strong values are the foundation of compliance, and that gives them a head start.
Good practice in terms of organisation
1.Reporting to the CCO, the compliance manager - more than just the person responsible - at the appropriate level The Chairman's role: often to the Chairman and/or as a member of the Executive Committee
2.Create different committees one dealing with ethics, ESG, governance and strategy at Board level, and operational committees at management, global function and subsidiary level
3.Strengthening the cross-functional and vertical nature of compliance
-Set up committees bringing together managers from all departments
-Ensure that the CCO is a member of numerous committees
-Create solid channels of communication with the Board of Directors
4. identify and train ambassadors to act as relays for the compliance team
5."De-siltering Building an organisation that brings together CSR, compliance, legal, financial, risk and business issues
Good business practice
1. involve ethics and compliance officers upstream of projects to better identify and monitor risks
2) Establish a virtuous circle linking information, evaluation and continuous improvement of policies and procedures by analysing discrepancies and monitoring the implementation of action plans.
3. train all employees in these issues and convince them that everyone is a player in the Group's compliance policy
4. map out all the risks - from corruption to third parties, not forgetting cyber, conflicts of interest, anti-trust, data privacy, human rights, etc. - then establish prevention policies
5) Meeting the challenge of international operations. This means crossing regulations and complex requirements in certain countries. We also need to make everyone accountable, both globally and locally.
The benefits of robust compliance governance
What's more, practical experience clearly shows that values and discipline are needed. You also need a policy and an organisation that integrate governance and compliance. These companies have also introduced communication systems and media. These help to frame, inform and inspire all stakeholders, from the board to employees in the most remote subsidiaries, via the management committee and third parties. Thanks to this positive vision of governance and compliance, the company and its management can protect its development and its image.
1.https://www.strategyand.pwc.com/gx/en/insights/ceo-success.html
2.Trophies for excellence in business ethics 2019
