The E&C Pulse - January 15, 2019

January 15, 2019 Ben DiPietro

12-Step Lifeline to Better Board Engagement on Ethics, Compliance

profile_pics_5At many boards of directors, it may be time for an intervention.

Their tone from the top is unacceptable when it comes to taking seriously the necessity of ethics and compliance. In some cases, their tone is nonexistent.

A survey conducted last year by LRN of chief ethics and compliance officers found 60% said their boards don’t hold senior executives accountable for bad behavior. About half said their boards don’t get education or training on their ethics and compliance responsibilities.

Only four in 10 said their board has metrics to help them measure the effectiveness of their E&C program, and the same percentage said their board never conducted a Department of Justice-required review of compliance failures.

Why does this matter? Because boards face legal and financial risks if they fail to properly manage ethics and compliance. And because these kinds of investments will pay major dividends in protecting a company’s reputation and long-term value.

Help is available--in this case, a 12-step program that is detailed in a new LRN guide to show boards how they can better operationalize their tone at the top on E&C matters.

The 12 steps offer strategies for boards on

  • How they can make sure they are spending enough time, and putting enough strategic focus on E&C issues;

  • What actions they can take to better hold senior executives accountable;

  • How they can forge better relationships with their ethics and compliance team;

  • How to help E&C identify the right metrics they need; and

  • How to know what the right type of board training they need is, and how to find it.

“Even though it is settled law and policy that boards of directors are required to oversee company compliance with law and regulation, it’s not shocking that boards may not give E&C its due, considering their huge range of responsibilities,” said LRN’s David Greenberg, author of the reports. He also serves as a director at a publicly traded company.

While it is settled that boards must be trained on E&C, LRN’s research found few boards actually fulfill this requirement. And when it is, often companies have their directors undergo the same training as employees, which misses the mark, he said.

Even if ethics and compliance oversight were not a requirement, Greenberg said boards still would be well advised to take a hands-on approach, which is what happens at companies that are doing this right. That’s because “one of the first questions that comes up when a compliance failure happens is, ‘Where was the board?’” said Greenberg.

Ultimately, if the gulf between chief ethics and compliance officers and boards can be bridged, Greenberg said it will requires boards to take meaningful steps to acknowledge the very real financial, tactical and moral benefits of the function.

“Ethics and compliance needs more support and scrutiny from boards if it is to safeguard company reputation and performance,”  he said.

(Click here to watch a webcast with Greenberg and LRN's Susan Divers discussing how boards can better engage on ethics and compliance.)


Ben DiPietro



LRN's upcoming report on moral leadership found 87% of the executives, managers and employees who responded said the need for moral leadership in business is now greater than ever. But just 7% said the leaders of their organizations often or always show moral leadership through their actions. The report will be released Early February. To learn more and sign up to receive the report, click here.



China soon will require users of blockchain-based services to register with the government using their real names, Sixth Tone reports.

The world of economics may be having its #MeToo moment, The New York Times reports. Women also are starting to assert themselves more forcefully into male-dominated religions, Associated Press reports.

The media is preaching the many benefits that will come from artificial intelligence but don't believe all the hype, John Naughton writes in The Guardian.

BSR's Alison Taylor speaks with LexisNexis about the growing interest among mainstream investors in environmental, social and governance issues.

Hui Chen writes in Bloomberg Law about the importance of strategic planning in compliance, and not just reacting to situations.

A U.S. sports apparel company ended its relationship with a Chinese firm that hired workers from an internment camp, Associated Press reports.

Women are making advancements in law firm associate representation, but blacks are not progressing as well, according to a report from the National Association for Law Placement, ABA Journal reports.

In hyper-partisan America, one group is working to bring back civil discourse among politicians and between regular people, The Washington Post reports.




"The job of effective leaders has changed from “doing the next thing right”—something, increasingly, machines can handle—to “doing the next right thing”—which involves moral choice." LRN CEO Dov Seidman shares his perspectives on Moral Leadership in The Fortune CEO Daily.


Several states have approved laws mandating workplaces train their employees about sexual harassment prevention. To help summarize what is required under the various laws of each jurisdiction, we produced this helpful guide. 


Previous Post
E&C Pulse - January 17, 2019
E&C Pulse - January 17, 2019

In this edition, Ben DiPietro shares insights from LRN's Susan Divers on how CEOs can hold Boards accountable.

Next Post
The E&C Pulse - January 10, 2019
The E&C Pulse - January 10, 2019

This edition takes a look at state laws now mandating employee training on anti-sexual harassment; also, a ...


Subscribe To LRN's E&C Pulse Newsletter

First Name
Last Name
Company Name
Job Title
Thank you!
Error - something went wrong!