LEADING WITH INTEGRITY

A Practical Guide for Managers

This toolkit provides guidelines and tools to help managers do the

following:
Enhance employee interactions and drive productivity
Reinforce corporate standards and values
Embed compliance and ethics into daily operations
Build the desired corporate culture

INTRODUCTION: PURPOSE OF THE GUIDE

As a leader at a large corporation, you operate in a fast-paced, complex
environment that consistently challenges you to make effective and timely
decisions. The pressure to perform can lead to situations where doing the
right thing may not always be evident, expedient, or easy. It is precisely at
these moments, however, when leaders need to understand the impact of
their actions on those nearest to them.
The Leading with Integrity guide helps managers use their position to create
an open, values-based culture where employees feel free to discuss and
proactively address concerns. You will find clear guidelines and situational
tips you can use to embed compliance and ethics into daily operations,
enhance interactions with employees, reinforce corporate standards and
values, and build the desired corporate culture. This guide prepares you to
navigate the complex business environment and ensure that pressure to
perform does not create an environment where misconduct is acceptable.
Additional Resources
The Leading with Integrity guide is supplemented by an online suite of
resources titled the Manager Self-Service Portal. These supplemental
resources include additional examples of talking points, ethical dilemmas, a
leadership self assessment and a compliance and ethics business case that
are not included in this toolkit. To achieve best results with this toolkit,
please visit the Manager Self-Service Portal.

TABLE OF CONTENTS
Index of Supporting Resources..........................................................4
Communicating with Integrity...........................................................4

Understanding Leadership Attributes....................................................... 5

Preventing Unintended Messages............................................................ 6
Creating Lasting Communications........................................................... 7

Conducting Effective Staff Meetings.......8

Integrating the Message into Staff Meetings............................................. 9

Knowing When to Deliver the Message.................................................. 10
Identifying Relevant Topics for Discussion.............................................. 12
Understanding Staff Perceptions........................................................... 16

Facilitating Compliance Training..17

Understanding the Responsibilities of a Training Facilitator....................... 18

Inviting Staff to the Training Session..................................................... 19
Preparing for the Training Session.........................................................20
Running the Training Session............................................................... 21

Supporting Corporate Initiatives. 23

Making the Compliance and Ethics Initiative Applicable ............................ 24
Facilitating Compliance and Ethics Initiatives.......................................... 25
Reinforcing the Compliance and Ethics Message...................................... 26

Receiving and Escalating Complaints... 28

Removing Employee Fear of Speaking Up...............................................29
Handling Sensitive Allegations.............................................................. 30
Communicating with the Complainant....................................................31

Discussing Compliance and Ethics Performance....... 32

Setting Objective Compliance and Ethics Performance Standards...............33

Resolving Problems and Conflicts.......................................................... 34

Disciplining Employees and Communicating Results... 36

Disciplining a Staff Member.................................................................. 37
Communicating Disciplinary Guidelines.................................................. 38
Communicating Disciplinary Action to Staff.............................................41

COMMUNICATING WITH INTEGRITY

The manager-employee relationship is a central driver of business success
and organizational culture. You are therefore in a unique position to
influence the effort and behavior of your employees. While you are
understandably focused on their operational or functional role, it is in your
best interests, and those of the company, to use your influence to promote
company values and reduce misconduct. In fact, research has shown that a
strong manager-employee relationship both increases productivity and
reduces the likelihood of misconduct.
On the next page there is a list of the key attributes that demonstrate strong
ethical leadership, as well as examples of potentially damaging and
preferable messages that managers commonly use.

I. UNDERSTANDING LEADERSHIP ATTRIBUTES

Key Ethical Leadership Guidelines for Managers

II. PREVENTING UNINTENDED MESSAGES

Examples of Potentially Damaging and Preferable Language

III. CREATING LASTING COMMUNICATIONS

Six Traits of Messages that Stick

I. UNDERSTANDING LEADERSHIP ATTRIBUTES

Key Ethical Leadership Guidelines for Managers*
As a manager, you play a key role in setting the right ethical tone throughout your
organization. It is therefore important that you stand behind corporate values such
as honesty, empowerment, ownership, good judgment and personal accountability.

Category
Ethical Tone
Model Ethical Behavior
Honesty and Integrity
Communicate Compliance
and Ethics Expectations
Carefully Listening to
Opinions of Others
Openness to New Ideas
Friendliness and
Approachability

Holding Peers
Accountable
Accepting Responsibility
for Successes and
Failures
Taking Action upon
Unethical or
Inappropriate Behaviors
and Practices of
Employees

Action
Create the appropriate environment for your staff by
emphasizing corporate values in your words, actions,
and deeds.
Model the behaviors in your Code of Conduct to
employees and discuss why this is important.
Ensure that your words and action align to give staff
confidence that you walk the talk when it comes to
compliance and ethics values, policies, and procedures.
Set clear behavioral expectation amo ng staff and train
them on the policies and laws relevant to the business
units operations.
Seek to understand staff needs and desires while
actively soliciting opinions and ideas. Take the time to
follow-up on particular needs.
Encourage employees to bring forward problems or ideas
by regularly asking their opinion and providing them an
audience with senior management.
Cultivate relationships with staff and ensure
approachability by keeping an open door. Encourage
employees to bring forward any problem, disagreement,
question, recommendation or comment.
Clarify compliance and ethics performance expectations
with staff and hold them strictly accountable for
successes and failures. Never justify unethical or illegal
acts by claiming that they helped the bottom line or
were directed by a higher authority in the organization.
Take responsibility for group failures while
acknowledging the success and contributions of team
members.
Establish clear disciplinary guidelines and uphold them in
all situations to ensure that employees believe in
organizational commitment to company action when
there are instances of misconduct.

*For additional information about these guidelines, see the Councils Ethical Leadership
Self-Assessment.

COMMUNICATING WITH INTEGRITY

II. PREVENTING U NINTENDED MESSAGES

Examples of Potentially Damaging and Preferable Language
Overview
To create the right culture, How you say something is often as important as
what you say. We have provided some examples of potentially damaging
language with a preferable alternative.

Reporting Concerns

Potentially Damaging: Please dont come to me with unconfirmed complaints about

your colleagues behavior.
Preferable: Thank you for coming forward about this. I know it took courage. I will
look into it following our corporate investigations policy.

Cutting Costs

Potentially Damaging: Think outside the box when managing rising costs this year.
Not balancing the budget will significantly affect your bonus.
Preferable: While I want you to focus on managing rising costs, remember that
honesty comes first. The cost of breaking the rules is too great.

Hitting Numbers

Potentially Damaging: Everyone has to hit their numbers this year. Senior
management will not accept any excuses.
Preferable: It is crucial that were all working together to reach our goals this year.
But remember: this company do es not take short cuts. Always put integrity ahead
of numbers.

Setting Deadlines

Potentially Damaging: I dont care what part you use. Just make sure the
prototype is done by Friday.
Preferable: I want this prototype by Friday, but I dont want you cutting any
corners. Is that manageable?

Crediting Good Performance

Potentially Damaging: Why cant I get Steve to create reports like this?
Preferable: Im really impressed with your work on this project. Nice job.

Working Abroad

Potentially Damaging: See what you can do to get this approved. Things work a
little differently over here.
Preferable: Look into the standard practice for getting approval here. I know things
work a little differently over here, but well have to make sure it complies with
company standards.

COMMUNICATING WITH INTEGRITY

III. C REATING LASTING COMMUNICATIONS

Six Traits of Messages that Stick*
Overview
To be effective leaders, managers must create memorable messages that have
lasting impact. Incorporating the following traits will help managers develop as
effective communicators.
1) SimplicityMessages are most memorable if they are short and deep. Glib
sound bites are short, but they dont last. Proverbs such as the Golden rule are
short but also deep enough to guide the behavior of people over generations.
2) UnexpectednessSomething that sounds like common sense wont stick. Look
for the parts of your message that are uncommon sense. Such messages generate
interest and curiosity.
3) ConcretenessAbstract language and ideas dont leave sensory impressions;
concrete im ages do. Compare get an American on the moon in this decade with
seize leadership in the space raced through targeted technology initiatives and
enhanced team-based routines.
4) CredibilityWill the audience buy the message? Can a case be made for the
message or is it a confabulation of spin? Very often, a person trying to convey a
message cites outside experts when the most credible source is the person listening
to the message. Questions-Have you experienced this?-are often more credible
than outside experts.
5) EmotionsCase studies that involve people also move them. We are wired,
Heath writes, to feel things for people, not abstractions.
6) StoriesWe all tell stories every day. Why? Research shows that mentally
rehearsing a situation helps us perform better when we encounter that situation,
Heath writes. Stories act as a kind of mental flight simulator, preparing us to
respond more quickly and effectively.

*Source: Crafting a Message that Sticks: An Interview with Chip Heath, McKinsey Quarterly,
November 2007, Lenny Mendonca and Matt Miller.

COMMUNICATING WITH INTEGRITY

CONDUCTING EFFECTIVE STAFF

MEETINGS
Discussion of compliance and ethics issues should be standard practice in
staff meetings. Integrating compliance and ethics messages into standing
staff meetings helps employees understand how compliance and ethics is
part of business as usual and sends a clear signal that compliance and
ethics is a priority for everyone. Staff meetings provide an opportunity to
foster awareness of common compliance and ethics issues, policies, and
resources. We have provided a list of key considerations for incorporating
compliance and ethics into staff meetings, as well as a few examples of code
of conduct-related ethical dilemmas for discussion.

I. INTEGRATING THE MESSAGE INTO STAFF MEETINGS

Key Considerations for Integrating Compliance and Ethics into Staff
Meetings

II. KNOWING WHEN TO DELIVER THE MESSAGE

Strategic Opportunities to Discuss Compliance and Ethics During Staff
Meetings

III. IDENTIFYING RELEVANT TOPICS FOR DISCUSSION

Examples of Ethical Dilemmas by Function
Examples of Ethical Dilemmas by Subject Matter

IV. UNDERSTANDING STAFF PERCEPTIONS

Potential Compliance and Ethics Questions to Discuss During Staff
Meetings

I. INTEGRATING THE MESSAGE INTO STAFF MEETINGS

Key Considerations for Integrating Compliance and Ethics into Staff Meetings
Align Compliance and Ethics Messages with Key Business Goals

Include compliance and ethics as a regular part of business activities to ensure

employees understand that it is an essential part of doing their jobs.
Example: Raise concerns over the manipulation of expense reports, violation of the
companys gifts and entertainment policies, and other activities that are a part of
day-to-day business.

Create Opportunities for Two-Way Communications

Ensure that you dont end up lecturing employees. Create an open dialogue with
them about relevant compliance and ethics issues.
Example: Choose one employee each month to spend a few minutes of a staff
meeting leading a compliance and ethics discussion.

Prioritize and Communicate Emerging Risks to the Business

Focus on key risks to the business so employees realize that youre not just going
through the motions but actually protecting the business.
Example: Highlight compliance and ethics issues that are a historic or emerging risk
to the specific business or function in which you work.

Raise Valuable Questions When Discussing Ethical Dilemmas

Encourage employees to engage in discussion around case scenarios by preparing

questions that address how to prevent misconduct.
Examples:
How would you prevent this problem?
What advice would you give to the parties involved?
How would this issue affect the organization?
Whats the nature and cause of the issue?

CONDUCTING EFFECTIVE STAFF MEETINGS

II. K NOWING WHEN TO DELIVER THE MESSAGE*

Strategic Opportunities to Discuss Compliance and Ethics
During Staff Meetings
Before the Launch of a New Product
As you all know, weve recently brought the Product ABC to market. The company
is making a huge bet on this product, so make sure you dont do anything to put its
success in jeopardy.
At the End of Each Quarter
Since were all working hard to hit our numbers here at the end of the quarter, I
thought this would be a good time to discuss the issue of proper financial
reporting.
During Periods of Substantial Employee Turnover
While we all like to think that we would respond correctly if we were ever in a
position to act unethically, I would like to spend a few minutes reviewing a few
scenarios and discussing how to respond when there is no clear right answer."
Before the Holiday Season
As we approach the holidays, lets all make sure we arent doing anything our
families would not approve of, such as accepting inappropriate gifts from vendors.
After a Change in Local or Senior Management
While we all get accustomed to the recent changes in the management team,
please remember that this company still expects the highest level of integrity from
all of us.
Following a Widely Known Compliance and Ethics Violation
As you may have seen in the news, the SEC has charged Company ABC with
authorizing improper payments to foreign government officials. I want to take a few
minutes to review the terms of the Foreign Corrupt Practices Act and make sure we
all know how to respond to a similar situation.
Following the Code of Conduct Rollout or After Substantial Changes to
Corporate Policy
Team, Compliance and Ethics just updated the Code of Conduct. It is available on
the company intranet, and I am alw ays available to answer any questions you may
have about it.

*For additional examples, see the Councils Library of Ethical Dilemmas.

CONDUCTING EFFECTIVE STAFF MEETINGS

10

II. K NOWING WHEN TO DELIVER THE MESSAGE*

(C ONTINUED)
Strategic Opportunities to Discuss Compliance and Ethics
During Staff Meetings
Miscellaneous

I want to use the last few minutes of our meeting today to talk about business
ethics. I want you to know how important ethical conduct is in this job, not only
because of company policy, but also because it is good for business. I dont expect
you all to know the Code of Conduct word-for-word, but you should be aware of the
policies and procedures that are relevant to you. Lets practice applying what you
know with some examples that dont necessarily have a clear right answer.

*For additional examples, see the Councils Library of Ethical Dilemmas.

CONDUCTING EFFECTIVE STAFF MEETINGS

11

III. IDENTIFYING RELEVANT T OPICS FOR DISCUSSION*

Examples of Ethical Dilemmas by Function
Finance

When writing the annual report, you include a footnote that explains an unusual
earnings number. Your supervisor deletes the footnote because the explanation
complicates the report. If the numbers are correct without the footnote, should you
pursue the issue?

Sales

There is extra money in the advertising budget at the end of the quarter and you
notice that your supervisor has recorded entertainment expenses as business
advertising expenses. You have always been impressed by your supervisors strong,
clear commitment to ethics. Does it matter if the expenses are recorded in the
correct category as long as the numbers are right?

Marketing

You have prepared a presentation on a new company promotion. You are excited
about the plan but worry that it wont resonate with the younger audience. You
want to discuss it with a longtime friend outside the company, a marketing
consultant who is an expert with this customer segment. Should you discuss the
plan with your friend?

Operations

A fellow employee informs you that many company employees do not properly
report minor workplace accidents because the disclosure affects their performance
reviews. Performance reviews are rolled up so the low number of accidents helps
you and your supervisor. In fact, your supervisor has won an award for safest
operation. The reporting employee is ultra-competitive and will stop at nothing to
get ahead. Should you pursue the employees claim?

Human Resources

You have a friend who wants you to compile a list of e-mail addresses of people at
your company who may be interested in his bus iness. You figure that they may like
the offer and want to help your friend, and no one would ever know you gave him
this information. Should you send the list of e-mails to your friend?

IT

You are working with a consultant in a password protected area o f the company
intranet. You must leave to take care of an urgent problem, and the consultant
offers to finish the research and logoff afterwards. Youve worked with the
consultant for several years and consider him to be completely trustworthy. Should
you accept the consultants offer?
*For additional examples, see the Councils Library of Ethical Dilemmas.
Use Compliance and Ethics Business Cases presentations to highlight Compliance and
Ethics importance to individual employees.

CONDUCTING EFFECTIVE STAFF MEETINGS

12

III. IDENTIFYING RELEVANT T OPICS FOR DISCUSSION*

(CONTINUED)
Examples of Ethical Dilemmas by Function
Procurement
You seek a supplier to provide construction work for your company and receive
three sealed bids for the job. You have worked with all three firms and think one of
them has consistently done superior work. The bids are all very close but your
favorite firm is slightly more expensive and will push costs over budget. Should you
reveal the lowest bid to your preferred firm so they can come in just under it?
Strategy
You resign and take a job at one of your previous companys competitors. Your new
supervisor mentions that one of the reasons the company hired you is your strong
background in the industry. Over time it becomes clear that your job depends on
helping your new company steal market share from competitors. Using information
from your previous employee would make you and the team look very good. Should
you divulge information from your previous company?
International
You are an expatriate in a developing country. Youre traveling on business about a
days ride from your offices. On the way there, you run up against a semiofficial
roadblock set by the army. The armed soldiers demand that you pay them USD
$1000 to get through. What do you do? Pay? Refuse? Refusing is clearly risky.
Gifts and Entertainment
Your company believes strongly in team building. As a reward for a job well done,
your company sponsors you and your colleagues in a weekday golf
tournament. During the tournament, a raffle is organized to raise money for a local
charity. Only tournament participants can buy a ticket. You buy a ticket with your
own money and to your surprise you win. The prizea round trip flight to the
Bahamas and two nights accommodation in a luxury hotelis generous. The prize
is non-transferable. Should you keep the prize?

*For additional examples, see the Councils Library of Ethical Dilemmas.

CONDUCTING EFFECTIVE STAFF MEETINGS

13

III. IDENTIFYING RELEVANT T OPICS FOR DISCUSSION*

(CONTINUED)
Examples of Ethical Dilemmas by Subject Matter
Company Resources Dilemmas

You notice that a plant operations manager uses her company phone and cell phone
for frequent personal calls. She has two young children, one of whom gets fevers
regularly. Is the manager justified in using company phones for personal calls?

Confidential Information Dilemmas

An employee is hospitalized, and a rumor spreads that she fell ill from a leaky pipe
in the workplace. Employees demand to know the circumstances of her illness as
they fear that they may also be at risk. The employee is suffering complications due
to an abortion and has asked you, her supervisor, to keep the terms of her sickness
confidential. What should you do?

Conflict of Interest Dilemmas

You supervise a contractor doing renovation work at your company. The contractor
suggests that since he has extra time, he could do some work on your home at a
deep discount. Youve had trouble finding a good contractor and the renovation
work is top-notch. You insist on paying the full rate. Should you take the offer?

Environmental, Health, and Safety Dilemmas

Your supervisor asks you to skip a few minor quality checks to make a strict
deadline. You provide the quality checks every day and there is never a problem.
Should you follow your supervisors instructions?

Financial Reporting Dilemmas

As the year comes to a close, you realize that your operation has already exceeded
the profit target in its annual business plan. Since your bonus is based only on
meeting the yearly target, you wonder if you should hold any further income
received that year off the books to get a head start on the next year. What should
you do?

*For additional examples, see the Councils Library of Ethical Dilemmas.

CONDUCTING EFFECTIVE STAFF MEETINGS

14

III. IDENTIFYING RELEVANT T OPICS FOR DISCUSSION*

(CONTINUED)
Examples of Ethical Dilemmas By Subject Matter
Government Relations Dilemmas

Your supervisor has you send free merchandise to an important government official.
You agree because you know this is commonplace in interactions with government
officials in this country and that company employees have been doing it for years.
Should you have agreed to send the merchandise?

Labor and Employment Dilemmas

You discover that your groups performance has significantly increased since you
began to go out for extended lunch breaks to discuss current business challenges.
One member of the group has difficulty walking to lunch and requests that the
group no longer talk business during lunch if she is not there. What should you do?

Investigations Dilemmas

While attending a social event outside of business hours, youre introduced to

someone by a mutual friend. You get to talking and she asks what you do. Upon
telling her where you work, she tells you how corrupt she thinks your company is.
In fact, she says that shes heard of procurement staff demanding kick backs from
suppliers. When you press her for more specific information, she quickly walks
away. You ask your friend about her and he tells you where she works. You dont
know, but its possible that her company is a supplier to your company. What do
you do?

Trading and Inside Information

You overhear two colleagues discussing that the company is considering acquiring a
small, publicly traded firm. You wonder if it is okay to acquire some of the firms
stock. You figure it is only a rumor, and even still, nobody knows you had heard it.
Should you buy the stock?

*For additional examples, see the Councils Library of Ethical Dilemmas.

CONDUCTING EFFECTIVE STAFF MEETINGS

15

IV. U NDERSTANDING STAFF PERCEPTIONS

Potential Compliance and Ethics Questions to Discuss During Staff Meetings
Company Engagement
1.

Does management act upon reported unethical practices?

2.

Does our work group have a climate in which diverse perspectives are
valued?

3.

Do you feel that the company has your best interest at heart?

Manager Engagement
4.

Do you feel employees are treated fairly, regardless of their differences?

5.

Are your ideas and opinions seriously considered?

6.

Do you receive the necessary information about organizational goals and

objectives to do your job effectively?

Employee Engagement
7.

Does your job make good use of your skills and abilities?

8.

Do you feel encouraged to come up with new and better ways of doing
things?

9.

Do you have the right tools to do your job effectively?

10. Do you feel a real opportunity to improve your skills here?

11. Do yo u like the kind of work you do?

CONDUCTING EFFECTIVE STAFF MEETINGS

16

FACILITATING COMPLIANCE TRAINING

As leaders, you serve a critical role in setting the ethical tone with your staff
and promoting a positive, inclusive, ethical work environment where all
employees can thrive. One method for demonstrating your commitment to
such a culture is facilitating a compliance and ethics training session.
Facilitating an in-person training session should not, however, be taken
lightly. Without proper preparation, you risk the possible gains from
manager-delivered training. This section of the guide is designed as a tool
to help the successful delivery of manager-led compliance and ethics training
by providing practical guidance. It is our hope you will find these ideas and
resources easy to use and that they reduce preparation time should you be
called on to facilitate training.
I. U NDERSTANDING THE R ESPONSIBILITIES OF A T RAINING FACILITATOR
Training Facilitator Responsibilities Checklist
II. INVITING S TAFF TO THE T RAINING SESSION
Training Facilitator E-Mail: Introducing the Session
III. P REPARING FOR THE T RAINING SESSION
Tips to Prepare for Training Sessions
IV. R UNNING THE T RAINING SESSION
Steps for Conducting a Training Session
Scripting for Opening a Training Session
Scripting for Closing a Training Session

17

I. UNDERSTANDING THE RESPONSIBILITIES OF A

TRAINING FACILITATOR
Training Facilitator Responsibilities Checklist*
Specific responsibilities of a training facilitator include the following:

Coordinate training session, including any logistical arrangements

Prepare for the training session

Determine a measure for success: What is the goal of the session?

Prepare questions to facilitate audience participation

Follow-up on any questions or concerns

Follow-up training with periodic reminders of compliance and ethics

importance

* If you are asked to facilitate a training session and would like to develop your skills
further, please contact your compliance and ethics or learning and development officer for
support.

FACILITATING COMPLIANCE TRAINING

18

II. INVITING STAFF TO THE T RAINING SESSION

Training Facilitator E-Mail: Introducing the Session*

From:
To:
Cc:
Subject:

[Name]
Staff

Sent: Wed 1/2/2008 9:30 AM

Compliance Training

Dear Team,
As you may know, we will conduct compliance training over the coming week. During this [one]hour session, we will discuss the importance of ethical decision making in our business lives as
well as a few specific compliance topics including [Ex: Harassment, Insider Trading, FCPA, etc.].
We place a great deal of emphasis on conducting business in an ethical manner for which we can
be proud. I would like to reiterate the importance the company places on compliance and ethics. It
is for this reason that I ask all of you to participate in this upcoming training session. It should be a
productive hour focused on company expectations and a conversation about your experiences,
concerns, and difficulties. I look forward to seeing everyone at the training next week.
Sincerely,
[Name]

*For additional examples, see the Councils Compendium of Compliance- and Ethics-Related
E-mails.

FACILITATING COMPLIANCE TRAINING

19

III. PREPARING FOR THE TRAINING SESSION

Tips to Prepare for Training Sessions
Preparing for the T raining Session

Identify how many people are to be trained and organize them into groups [if
necessary].

Select three or four ethical dilemmas that are appropriate for your group
[See Councils Library of Ethical Dilemmas].

Reserve a room with enough tables and chairs for comfortable seating.

Send participants a meeting notice with the time and place for the session.
Send the notice sufficiently in advance to allow participants time to plan their
schedules.

Review the leaders opening and closing remarks. Feel free to personalize the
messages.

Review the Dos and Donts for Leading a Training Session.

Write down the name and phone number of your local Compliance and Ethics
Officer (if applicable). This information will be given to the participants.

Dos and Donts for Leading a Training Session*

Dont wait until the last minute to schedule your session.

Do send out a meeting notice to all participants well in advance of the
scheduled session.

Dont wait until youre in the room to figure out how to facilitate the training.
Do take the time to review the included materials and select the cases that
are the most relevant to your group.

Dont forget to arrange people in teams before you review the cases.
Do arrange the teams so that participants can easily discuss the cases
among themselves and between teams.

Dont let people sit out the session without participating or let one or two
people dominate the entire discussion.
Do take the initiative to get everyone involved in the activity and keep the
conversation flowing around the room.

*Source: Lockheed Martin Corporation; Compliance and Ethics Leadership Council research.

FACILITATING COMPLIANCE TRAINING

20

IV. RUNNING THE TRAINING SESSION

Steps for Conducting a Training Session
Running the Training Session*

Your role in the train ing is to introduce the topics and foster a productive
conversation among staff. In fact, the goal of training is to foster a dialogue about
the compliance issues and ethical dilemmas that employees face.

How the Session Works

Divide participants into teams of 4 to 6 participants

Present a case dilemma.
Pose a question to the team.
Each team discusses the case, answering the following questions:
- What are the issues involved?
- How would you prevent this problem?
- How would this issue affect the organizatio n?
- Whats the nature and cause of the issue?
- How should the situation be resolved?
Discuss any issues not addressed by participants and any applicable policies.
Continue with another case. There should be time to cover three to four
cases in a one-hour session.

Choosing Cases

Research has indicated that discussions centered around employee concerns that
outline typical work scenarios are most effective. It is therefore recommended that
you choose case examples that will resonate with your staff. Before presenting
training, identify several cases to illustrate the point of the session. Use CELCs
Library of Ethical Case Scenarios and Questions to assist in this effort.

Discussing Cases

Spend three to five minutes describing each scenario and raising a central ethical
challenge. Foster a discussion with participants around the ethical issues involved in
the case and how the situation should be resolved. To that end, managers should
present ethical dilemmas and create a conversation about:
After the discussion, have the participants vote on the best outcomes and discuss
the choice.

* Source: Lockheed Martin Corporation; Compliance and Ethics Leadership Council.

FACILITATING COMPLIANCE TRAINING

21

IV. RUNNING THE TRAINING SESSION (C ONTINUED )

Scripting for Opening a Training Session
Welcome to this years compliance and ethics training. The object of this training
is to stimulate thought and discuss key compliance and ethics issues. We want
you as employees to lead a discussion of the different compliance and ethics
challenges that you face, think through these real-life situations, and identify the
proper outcomes.
Most employees face an ethical dilemma at some point in their career and will
experience the challenge of how to proceed. Ultimately, we want employees who
are capable of dealing with these challenges. After participating in this session,
we are confident the answer will be yes.
One of our most important goals as a company is to maintain the highest
standards of ethics and integrity. As employees, you create the ethical tone and
safeguard our corporate reputation.

Scripting for Closing a Training Session

Before we conclude, I want to emphasize that all employees are encouraged to
seek advice or express concerns of any kind to the person with whom you are
the most comfortable. That includes your supervisor or manager, your local
compliance and ethics officer, human resources, audit, legal, or the corporate
ethics office.
Your local Compliance and Ethics Officer (if applicable):
Name:
Phone:
One last note your feedback on this training program is extremely important.
The training evaluation form is online this year and is part of the online training
acknowledgement process at the ethics Website. Thank you for participating in
todays program.

FACILITATING COMPLIANCE TRAINING

22

SUPPORTING CORPORATE INITIATIVES

Managers can be effective stewards of compliance and ethics by reinforcing
communications delivered from the corporate office. By putting your own
touch on corporate messages, such as a companywide speaking-up
campaign, you can make compliance and ethics more personal and relevant
to employees. This local emphasis also indicates the importance of
compliance and ethics to the business and ensures that you are buildi ng off
of a consistent company voice. Below is a list of key considerations for
enhancing corporate compliance and ethics initiatives, as well as an example
of how you can build on one.

I. MAKING THE COMPLIANCE AND ETHICS INITIATIVE APPLICABLE

Key Considerations for Enhancing Corporate Compliance and Ethics
Initiatives

II. FACILITATING COMPLIANCE AND ETHICS INITIATIVES

Strategic Opportunities to Leverage Compliance and Ethics Initiatives
Suggestions for Supporting Compliance and Ethics Initiatives
Tips for Using Compliance and Ethics Tools

III. REINFORCING

THE

COMPLIANCE AND ETHICS MESSAGE

Examples of Manager Responses to Compliance and Ethics Initiatives

23

I. MAKING THE C OMPLIANCE AND ETHICS INITIATIVE

APPLICABLE
Key Considerations for Enhancing Corporate Compliance and Ethics
Initiatives
Tailor Messages to Audience

Following a corporate compliance and ethics message, managers can provide rolespecific information to their employees by focusing on issues that are especially
relevant to their day-to-day work or tie into business strategy.
Example: Explain how a new companywide policy will impact the business units
standard operating procedures when working with clients abroad.

Provide Insight into Corporate Initiatives

Line managers provide a local voice for explaining the background behind corporate
initiatives and their importance to the organization. This keeps employees aware of
their obligations while engaging them with the company as a whole.
Example: Explain how the company develo ped a speaking-up policy to deal with
employee concerns about retaliation, which was revealed through a companywide
survey.

SUPPORTING CORPORATE INITIATIVES

24

II. FACILITATING COMPLIANCE AND ETHICS INITIATIVES

Corporate compliance and ethics initiatives provide an excellent opportunity
to discuss compliance and ethics issues with staff. This section highlights
the typical corporate initiatives with suggestions and tips for making those
initiatives a local success.
Strategic Opportunities to Leverage Compliance and Ethics Initiatives

New or Revised Corporate Policies

Code of Conduct Updates and Certifications

Risk Assessments

Internal Audits

Compliance and Ethics Training

Speaking-Up Campaign

Suggestions for Supporting Compliance and Ethics Initiatives

State your personal support for the compliance and ethics message (as
discussed in training).

Sign-up for and take any e-training first.

Forward associated e-mails to staff

Send an e-mail to your team encouraging and requiring training

participation.

Tips for Using Compliance and Ethics Tools

Attach compliance and ethics program brand to e-mail signature.

Hang compliance and ethics program posters in prominent places.

Supplement communications with relevant news articles and games.

SUPPORTING CORPORATE INITIATIVES

25

III. REINFORCING THE C OMPLIANCE AND ETHICS MESSAGE

Examples of Manager Responses to Compliance and Ethics Initiatives
Overview

Using speaking-up and training campaigns for examples, this section provides
language that a manager can use to discuss a corporate compliance and ethics
initiative.

Sample Excerpts from Company Speaking-Up Policy

1. What Does This Policy Cover?
This policy sets the standards and procedures for when and how company
employees should speak up and report conduct that they in good faith believe
violates a law, regulation, or company policy
2. Who Must Follow This Policy?
If you see or learn firsthand of improper conduct, you should speak up; if you
suspect improper conduct, you should speak up. This basic concept applies to
everyone who works at the Company anywhere in the world
3. How Does the Company Address Actual or Potential Retaliation?
Any employee who seeks advice in good faith and raises a concern or reports
suspected misconduct is doing the right thing. The company will not tolerate
retaliation against this person
4. What Does the Company Expect of Me?
The company cannot live up to its commitments to act with integrity if we, as
company employees, do not speak up when we should

Sample Manager Response

From:
To:
Cc:
Subject:

[Name]
Staff

Sent: Mon 1/7/2008 1:30 PM

Speaking-Up Campaign

Team,
I want to follow up on the e-mail you recently received from the compliance and ethics office to
express my support for this campaign and let you know that Im here to answer any questions you
may have. While the speaking-up campaign stresses the use of the company help line to report
perceived misconduct, my door is always open if you would feel more comfortable discussing your
concerns with me. You should always feel safe raising concerns without any fear of retaliation.
This is very important to me as it is a key part of making this a successful business and a great
place to work.
Thanks,
[Name]

SUPPORTING CORPORATE INITIATIVES

26

III. REINFORCING THE C OMPLIANCE AND ETHICS MESSAGE

(CONTINUED)
Examples of Manager Responses to Compliance and Ethics Initiatives
Sample Question from Compliance Training
What are the consequences of violating the Foreign Corrupt Practices Act (FCPA)?
A) Criminal penalties of up to $2 million per incident, or the amount of gain to
the violating company for each violation
B) Civil penalties of up to $10,000 per violation
C) Suspension or debarment from federal government contracting
D) Potential $100,000 fines and five years imprisonment for officers, directors,
shareholders, agents, or other employees of a domestic company who
willfully violate the anti-bribery provisions. These individual monetary
penalties may not be paid by the company.
E) All of the above

Sample Manager Response to Compliance Training

From:
To:
Cc:
Subject:

[Name]
Staff

Sent: Fri 1/11/2008 7:30 AM

Speaking-Up Campaign

Team,
I want to follow up on the anti-corruption training you just took to highlight a few relevant points
that relate specifically to our business.

Driven by your desire for more discussion, I will hold a Q&A session this Thursday on the
topic of anti-corruption and the FCPA. All questions are welcome.
Only a few years ago in this office, the company refused to pay the Labor Officer bribes to
obtain approval to allow women to work second shifts. The company pleaded their case to
the Labor Minister. Ultimately, permission was granted.
We will be taking the following steps to integrate the companys FCPA policy into our
business:
o Incorporate compliance risk assessment into the strategic planning process
o Incorporate contractual safeguards into contracts
o Provide education when working with third parties

Thank you all for participating in this very important training session. FCPA compliance is crucial
to this companys success, especially in our business. I look forward to seeing you at the Q&A
session this week.
Best,
[Name]

SUPPORTING CORPORATE INITIATIVES

27

RECEIVING AND ESCALATING

COMPLAINTS
Compliance and Ethics Leadership Council research found that the best
predictor of business misconduct is an environment where employees fear
retaliation for raising concerns. As such, it is critical that managers create an
environment conducive to the free exchange of ideas and the reporting of
observed misconduct.
To feel comfortable reporting concerns, employees need assurance that
a) they will not be retaliated against for speaking up, and b) their manager
will handle the issues appropriately and discreetly. To help you develop this
culture of speaking-up and satisfy employee concerns, the Council has
created a number of tips and resources.

I. REMOVING EMPLOYEE FEAR OF SPEAKING UP

Suggestions for Removing Employee Fear of Speaking Up
Tips on Receiving an Allegation of Misconduct

II. HANDLING SENSITIVE ALLEGATIONS

Steps for Proper Allegation Handling

III. COMMUNICATING WITH THE COMPLAINANT

E-Mail Outlining Results of the Investigation

28

I. REMOVING EMPLOYEE FEAR OF S PEAKING U P

Suggestions for Removing Employee Fear of Speaking Up
Understand Your Role: Remove Employee Fear of Speaking Up

Watch your tone of voice and body language (i.e., demonstrate due attention
to employee concerns).

Keep an open-door policy, inviting employees to share problems and

concerns.

Help employees understand that it is their duty to report observed

misconduct.

Create meaningful transparency into management thinking and direction.

Involve all employees in social functions.

Treat all employees with courtesy, dignity, and respect.

Tips on Receiving an Allegation of Misconduct

Behavioral Tips for Receiving Concerns

Thank the employee for coming forward.

Reassure the employee that the issue will be handled as sensitively

as possible.

Take notes to ensure accurate information.

Explain confidentiality to mitigate potential employee fears.

Outline likely steps for an investigation.

Establish a time for a follow-up discussion.

RECEIVING AND ESCALATING COMPLAINTS

29

II. HANDLING SENSITIVE ALLEGATIONS

Steps for Proper Allegation Handling
Steps for Proper Allegation Handling
1) Determine if the concern is urgent and requires immediate action.
2) Determine if its best to refer the issue for investigation.
3) Act promptly to begin any necessary investigation.
4) Determine if any corrective or disciplinary actions are needed.

Suggestions for Escalation Criteria

Managers should use standard criteria to determine when identified incidents need
to be escalated to the corporate office. All incidents should be communicated to
local HR. Typical escalation criteria include the following:

Egregious, deliberate, willful attempt to circumvent normal procedures or

controls

Falsification of research, development, production, and product-quality data

Falsification of the companys financial records

Issues resulting in, or likely to trigger, a non-routine government

investigation

Issues which could have a negative public relations impact for the company

Misrepresentation within documents submitted to a government entity or

customers

Offering, paying, or accepting bribes or kickbacks to secure business

Potential material financial impact to the local business unit affected or

the enterprise

Significant misuse of companys funds, including theft, fraud, and

embezzlement

Systemic or pervasive action directed by or toward a group of individuals

RECEIVING AND ESCALATING COMPLAINTS

30

III. C OMMUNICATING WITH THE COMPLAINANT

E-Mail Outlining Results of the Investigation

From:
To:
Cc:
Subject:

[Name]
Staff

Sent: Tues 1/8/2008 1:30 PM

Internal Investigation

Dear [Employee Name],

You recently provided information or support in connection with a confidential internal
investigation of [Description of Allegation]. This note is to inform you that we have just recently
completed our internal investigation of the issue.
We appreciate your cooperation during this process. Your involvement has been crucial in
supporting [Companys] commitment to maintaining the highest standards of ethical conduct and
business integrity. As always, please strive to maintain the confidentiality of this investigation.
Although the details of this matter are confidential, if you have any questions or comments about
this process or any additional information about this matter, please feel free to contact me directly
at [Contact Information].
[Company Name] would like to thank you for coming forward and reporting this matter. We take
these matters very seriously and appreciate your efforts.
Best Regards,
[Name]

RECEIVING AND ESCALATING COMPLAINTS

31

DISCUSSING COMPLIANCE AND ETHICS

PERFORMANCE
Compliance and ethics performance discussions, whether following
misconduct or during the performance appraisal process, are an excellent
one-on-one opportunity to impact employee behavior. You should reinforce
business principles by both rewarding ethical leaders and disciplining
unethical or illegal behavior. An open and frank discussion of compliance,
ethics, and employee behavior should be had at this time. Come prepared
with examples of specific behaviors that should be rewarded and
admonished while drawing an implicit link between performance,
compliance, and company values.

I. SETTING OBJECTIVE COMPLIANCE AND ETHICS PERFORMANCE

STANDARDS
Sample Compliance and Ethics Performance Guidelines

II. RESOLVING PROBLEMS AND CONFLICTS

Suggestions for Conducting One -on-One Employee Sessions
Examples of Sensitive Issues

32

I. SETTING OBJECTIVE C OMPLIANCE AND ETHICS

PERFORMANCE STANDARDS
Sample Compliance and Ethics Performance Guidelines
Compliance and Ethics Performance Minimum Standards

Timely completion of all required compliance and ethics training

No violations or disciplinary actions

Role-modeling the companys values and behaviors

Proactively identifying potential risks

Working well with and supporting colleagues

Taking responsibility for failures and acknowledging success

Treating colleagues fairly and with respect

Reporting observed misconduct

Exceeds Compliance and Ethics Expectations

Facilitating compliance and ethics training

Presenting compliance and ethics topics at staff meetings

Acting in an exemplary manner (e.g., refusing cash component of

prestigious industry award)

Contributing stories or videos to company newsletter or corporate compliance

offices

Serving as a local ethics advisor or liaison

DISCUSSING COMPLIANCE AND ETHICS PERFORMANCE

33

II. RESOLVING PROBLEMS AND CONFLICTS

Suggestions for Conducting One-on-One Employee Sessions
Preparing for Discussion of Sensitive Issues
1) Identify the issue to be addressed.
2) Review the companys policy on the issue.
3) If necessary, include a human resources representative in the conversation.
4) Gather related documentation.
5) Involve union representation when necessary.

General Rules for Providing Critical Employee Feedback*

1) Dont Just Talk, Listen

Its not unnatural for people to be defensive or feel the need to make excuses for
their poor performance. You can help prevent these instances from becoming
confrontational by listening to their counterpoints. Sometimes the excuses are
valid, sometimes not. In either case, you can use this part of the discussion as the
groundwork for building a plan together for closing this performance gap.

2) Prepare for Negative Reactions

Regardless of your planning and preparation, there is always a chance your

employee will react negatively. In those situations, it is critical to listen to their
points, appear calm, and make sure you present an unbiased view of the
development area. Once your point has been made, you can attempt to develop a
plan for addressing the performance problem now, or you can wait until the
employee appears more receptive to your perspective.

3) Summarize the Conversation and Provide Next Steps

Begin to develop a plan for addressing the performance weakness and provide an
overview of how you plan to support your employee through this process. You may
also take this opportunity to discuss your expectations for the next review cycle.
Even if the conversation has been tense, make sure you provide a summary that
includes performance strengths.

4) Dont use Inflammatory Language

Be clear that misconduct is not to be repeated, but do not use inflammatory

language that exacerbates or exaggerates the potential damage. Employees should
not be made to feel worse about a situation than is justified.

*Source: Corporate Leadership Council research; Compliance and Ethics Leadership Council.

DISCUSSING COMPLIANCE AND ETHICS PERFORMANCE

34

II. RESOLVING PROBLEMS AND CONFLICTS (CONTINUED )

Suggestions for Conducting One -on-One Employee Sessions
General Rules for Providing Critical Employee Feedback*
5) Provide Specific Examples of Strengths in Action

Detail examples of desired compliance and ethics attributes in action to clarify for
the employee the types of actions that should be taken. Rewards or
acknowledgement create positive incentives for exemplary behavior.

Examples of Sensitive Issues

Staff complaints about the treatment he or she is receiving at the hands of a

colleague.

A known conflict of interest that may impact an employees judgment and, as

a result, may be favoring one colleague or third party unfairly

One employee fails to treat colleagues with respect

Failure to report a serious compliance violation of which he or she was aware

Repeated failure to take required compliance training

An employee regularly violates, or attempts to violate, the companys stated

gifts and entertainment or expense policy

An employee improperly uses company supplies and equipment

*Sourc e: Corporate Leadership Council research; Compliance and Ethics Leadership Council.

DISCUSSING COMPLIANCE AND ETHICS PERFORMANCE

35

DISCIPLINING EMPLOYEES AND

COMMUNICATING RESULTS
Employees are highly sensitized to perceptions of justice. As such, they must
feel that you take issues of misconduct seriously and show no favoritism in
disciplining people who break the rules. It is therefore important that you,
following company policy, establish clear disciplinary guidelines and uphold
them in all situations.

I. DISCIPLINING A STAFF MEMBER

Guidelines for the Disciplinary Conversation

II. COMMUNICATING DISCIPLINARY GUIDELINES

Guidelines to Determine Appropriate Disciplinary Actions
for Misconduct

III. COMMUNICATING DISCIPLINARY ACTION TO STAFF

E-Mail to Notify Staff about Disciplinary Actions Taken
E-Mail to Notify Staff About Disciplinary Actions Taken (Senior
Management or Corporate Fraud)

36

I. DISCIPLINING A STAFF MEMBER

Guidelines for the Disciplinary Conversation
Tips for Disciplining Employees (Please consult the appropriate
human resources representative before any significant disciplinary
action)

Determining the severity of the violation.

- If severe or requiring termination, seek the assistance of a local human
resources representative.

Establish the facts of the case before holding the conversation.

Keep a measured tone when discussing the incident.

Use this opportunity as a teaching momentdiscuss the violation along with

the relevant company policy.

Ask why the violation occurred. Does the employee feel that these violations
occur frequently?

Assure the employee that the violation is behind him or her, but that a
repeat offense will result in severe consequences.

Construct an developmental plan that ties compliance and ethics leadership

to performance goals (e.g., no more violations, leading a compliance and
ethics sessio n with staff).

Tips for Monitoring Employees: Red-Flag Warning Lists

Increased Absenteeism

Increasingly Erratic Behavior

Complaints from Colleagues

Changes in Productivity

Repeated Poor Judgment

Personal or Financial Difficulties

DISCIPLINING EMPLOYEES AND COMMUNICATING RESULTS

37

II. C OMMUNICATING DISCIPLINARY GUIDELINES

Guidelines to Determine Appropriate Disciplinary Actions for Misconduct

Allegation
Categories

Primary
Functional
SME

Accounting/Auditing
Fraud and Internal
Accounting Controls
Adequacy/Integrity
of Books and
Records
Disclosure Controls
Money Laundering
Insider Trading

Internal
Audit

Advertising and
Promoting to
Consumers

Legal

Commercial Bribery

Legal

Environmental
Safety/Quality

Product
Safety

Fair Competition

Legal

Secondary
Functional
SMEs
- Corporate
Compliance
and Ethics
- Legal
- Information
Security
- Corporate
Security
- Corporate
Controller
- Global
Advertising
- Customer
Relations
- External
Relations
- Internal
Audit
- Corporate
Compliance
and Ethics
- Legal
- External
Relations
- Corporate
Security
- Internal
Audit
- Corporate
Compliance
and Ethics

1st
Offense
Min

2nd
Offense
Max

1st
Offense
Min

2nd
Offense
Max

DISCIPLINING EMPLOYEES AND COMMUNICATING RESULTS

38

II. C OMMUNICATING DISCIPLINARY GUIDELINES

(C ONTINUED)
Guidelines to Determine Appropriate Disciplinary Actions for Misconduct

Allegation
Categories
General Code of
Conduct
Conflicts of Interest
Breach of Confidential
Information
Electronic Media Use
Gifts and
Entertainment
General Legal and
Regulatory Issues
Anti-Trust
Government
Contracting/Pricing
Employee Relations
Discrimination
(Age/Race/Gender/
Religion/Disability)
Harassment (Sexual
or Other)
Inappropriate Conduct
in the Workplace
Improper Use of
Company Assets:
Computer or
Information Loss
Improper Use of
Company Assets:
Equipment, Supplies,
Credit Card, Time
Abuse
Improper Use of
Company Assets:
Misappropriation of
Assets
Improper Use of
Company Assets:
Property Damage or
Theft

Primary
Functional
SME

Secondary
Functional
SMEs

1st
Offense
Min

2nd
Offense
Max

1st
Offense
Min

2nd
Offense
Max

Corporate
Compliance
and Ethics

- Corporate
Security
- Legal
- Human
Resources

Legal

- Corporate
Compliance
and Ethics
- Corporate
Security

Human
Resources

- Legal
- Corporate
Compliance
and Ethics

Information
Security

- Corporate
Security
- Customer
Relations
- Privacy

Human
Resources

- Corporate
Security
- Internal
Audit

Internal
Audit

- Corporate
Security

Corporate
Security

- Human
Resources

DISCIPLINING EMPLOYEES AND COMMUNICATING RESULTS

39

II. C OMMUNICATING DISCIPLINARY GUIDELINES

(C ONTINUED)
Guidelines to Determine Appropriate Disciplinary Actions for Misconduct*
Allegation
Categories

Primary
Functional
SME

Privacy

Legal

Security
Workplace Theft/
Violence
Employee Safety

Corporate
Security

Transnational Laws
Anti-boycott and
Embargo Laws
Foreign Corrupt
Practices Act
Trade Control

Legal

Secondary
Functional
SMEs

1st
Offense
Min

2nd
Offense
Max

1st
Offense
Min

A*

- Human
Resources
- Informatio
n Security
- External
Relations
- Corporate
Compliance
and Ethics
- Human
Resources

- Internal
Audit

2nd
Offense
Max

*Disciplinary Action Legend:

A: Managing Performance (e.g., coaching, training)
B: Verbal Warning (documented and placed in employees HR personnel file)
C: Written Warning (signed by employee and placed in employees HR personnel
file)
D: Additional Internal Action (e.g., change in role, job level or salary plan)
E: Resignation or Voluntary Retirement
F: Employment Termination
G: Additional Legal Action (e.g., civil or criminal prosecution)

DISCIPLINING EMPLOYEES AND COMMUNICATING RESULTS

40

III. C OMMUNICATING DISCIPLINARY ACTION TO STAFF

Email to Notify Staff about Disciplinary Actions Taken*
From:
To:
Cc:
Subject:

[Name]
Staff

Sent: Thurs 1/10/2008 2:30 PM

Disciplinary Action

Dear [Employee name/s],

As you may have heard, we recently took action to discipline an employee who [pertinent
information about case]. As a result of these actions, the company [nature of disciplinary action].
The company takes very seriously all issues of misconduct and disciplines any employees found in
violation of company policy. For additional information about company policies, please find our
Code of Conduct [here]. If you have outstanding questions about our policies or about the
expectations of you as a [Company Name] employee, please feel free to ask me. It is important
to remember that we are all stewards of [Companys Name] reputation.
Best Regards,
[Name]

*Disclaimer: As individual privacy is an important concern, please refrain from disclosing

the name or defaming the character of the employee receiving disciplinary action. The
object of this exercise is to use a known incident as a teaching opportunity and to dispel any
damaging myths that might exist. If you have questions, please consult your compliance
and ethics officer and/or general counsel.

DISCIPLINING EMPLOYEES AND COMMUNICATING RESULTS

41

III. C OMMUNICATING DISCIPLINARY ACTION TO STAFF

(C ONTINUED)
E-Mail to Notify Staff about Disciplinary Actions Taken (Senior Management
or Corporate Fraud)*
From:
To:
Cc:
Subject:

[Name]
Staff

Sent: Thurs 1/10/2008 2:30 PM

Internal Investigation

Dear [Insert Names Here ],

As you have likely heard or seen in the news, we have recently undergone a [describe incident].
The company takes these issues very seriously and is working to identify those responsible, address
the problem, and restore our reputation. We do not condone this behavior and regret the resultant
loss of goodwill with customers, shareholders, and the community. In the coming months we will
work hard to put in place controls and training that will prevent a future occurrence of [describe
incident]. This also marks an excellent opportunity to review the commitment we have all already
made to each other: our Code of Conduct.
Following this incident, we will redouble our efforts and commitments to being a trusted, ethical
company. This type of commitment requires all employees to band together and exhibit those
behaviorstrust, honesty, fairness, and transparencythat have made our company great.
Please feel free to contact me if you have any questions about [incident].
Best Regards,
[Name]

*Disclaimer: As individual privacy is an important concern, please refrain from disclosing

the name or defaming the character of the employee receiving disciplinary action. The
object of this exercise is to use a known incident as a teaching opportunity and to dispel any
damaging myths that might exist. If you have questions, please consult your compliance
and ethics officer and/or general counsel.

DISCIPLINING EMPLOYEES AND COMMUNICATING RESULTS

42