Sept. 16, 2020
If It’s Who You Know, How Do You Meet Them?
The COVID-19 pandemic coming amid a year of social unrest and climate distress is making ethics and compliance professionals work harder than ever before in 2020.
With the hard work and stressful moments come opportunities, especially in being able to showcase the necessary and vital work being done by E&C to keep companies working, keep their people and teams together, and to keep the focus on the organization’s values and mission.
As boards work with executive leadership to navigate these crises, it’s incumbent upon chief ethics and compliance officers not to think of themselves as just CECOs; rather, they should spotlight their expertise managing risk; handling crises; forging corporate culture; developing and delivering learning and communications; and influencing human behavior in companies.
Not only will this make them more helpful to the company’s leadership, but these are some of the skillsets boards are looking for as they consider new directors. The irony, though, is while boards need the skills possessed by many chief ethics and compliance officers, they often don’t think of CECOs as board candidates.
There are some encouraging signs for board diversification, and that can only be of benefit to CECOs seeking board appointments. A report last year from Spencer Stuart found 432 new independent directors were named in 2019, the most in a year since 2004. The same report found 59% of those named to boards were women and minority men, and 27% of these newly appointed directors are serving on a board for the first time.
That means boards are looking for new people, with new skills and perspectives. This will only be further driven by companies that have committed to a path of racial justice, and also driven by legislation, such as the new law in California that will require not only at least one woman be on each public company board, but also one person from an underrepresented segment of society.
What CECOs can do to market their skills, build their networks, and enlist support for their board aspirations? What do CECOs have to offer boards? What is the differences between public board service and being a director of a private board? Why will serving on a board will make you a better ethics and compliance executive?
AARP’s Ellen Hunt and LRN’s David Greenberg shared their thoughts and expertise on these questions during this week’s virtual SCCE convention.
Asked how CECOs can break into circles where they can meet and interact with board members, or others interested in board service, Hunt said it’s the same process people use to learn more about something that interests them. “You go ask questions, you go meet people, you attend meetings, you join associations,” she said.
Get to really know the people on your organization’s board, as they can be a great network and a great way to learn about how you should go about your journey, and might be the people who recommend you for the next board seat, said Hunt.
While there were 432 new board directors in 2019, Greenberg said more than 10,000 people were seeking those positions. A lot comes down to luck, a lot involves who you know, said Greenberg, who serves as chair of the governance committee for NYSE-listed shipping firm International Seaways Inc.
When there is an open board seat at Seaways, here’s what Greenberg said he considers: the board’s diversity demographics; its current business challenges; areas the last couple of years the board could have used more depth; ESG issues; and whether the candidate had any core expertise in the global oil and transportation markets.
To stand out from the crowd, someone with a compliance background needs to demonstrate they are more than a chief compliance officer, he said. “You need to show you’re a strategic executive with experience in enterprise risk, law, audit, general management, or whatever else you have done, or come from,” said Greenberg, who earlier in his career served as a CECO at Altria.
When he says it’s someone who you know who can help you get onto a board, he doesn’t mean someone you met at a conference and know just a little. “It will be someone who has been in the trenches with you, and knows that you should be part of a small group and boardroom culture because you’re trusted, you’re insightful, and you get along with people without giving up your point of view,” said Greenberg.
Hunt said that’s why it’s vital to build a network before you need it. “When you’re creating authentic relationships because you have an interest in what the person does, you like them, that’s always much better than when you’re coming with the ask: ‘I want you to help me get on a board,’” she said.
What you want are established relationships with people who are on boards and in other positions, so when somebody says they are looking for a board member, that person can confidently give them your name. That means getting outside the world of E&C, and joining other associations, or even earning board certifications as a way to show you are serious and committed to the idea.
“As ethics and compliance professionals, we sometimes spend too much time with each other,” said Hunt. “Broaden your horizons!”
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