The LRN ethics and compliance risk management practices report

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% Respondents DETAILED RESULTS Educational Programs on Ethics and Compliance Risks - Global Companies 0% 20% 40% 60% 80% 100% % Respondents 96% Code of conduct/ethics 0% 84% 20% 40% 60% 80% 100% 96% Code of conduct/ethics Internal communications Internal communications Online education 76% Headquarters International 85% White collar - Professional, Managerial Formal 9600% CEO/senior Online education mgmt development 7400% Educational Programs on Ethics and Compliance Risks - Global Companies 92% 84% policies and 76% supply an anonymous hotline to all employees. So your ecosystem should meet 92% 85% the same stringent guidelines you expect from your employees. Chart 2 65% 77% Global 65% companies 58% experience significant declines in their ability to reach offices Chart 2 77% 74% outside of their headquarters. Global Companies: Ethics and Compliance Educational Program Outreac White collar - Sales, Clerical 9100% 7200% Headquarters International Formal CEO/senior mgmt Classroom-offline development education 58% 54% % Respond Board of Directors 6800% 3000% anagerial 9600% 7400% 74% 69% Service workers 6300% Electronic certifications 4400% Global Companies: Ethics and Compliance 0% Educational 20% Program 40% Outreach 60% 80% Classroom-offline education 54% 55% 9100% 7200% Blue collar - Craftsman, Foreman 6300% 5000% 66% 96% 69% % Respondents 6800% 3000% Management/leadership Electronic certificationsdevelopment White collar - Professional, Managerial 55% 50% 74% Blue collar - Semiskilled, Unskilled 6000% 4600% 6300% 4400% 0% 20% 40% 60% 80% 100% 66% 60% Business Partners Management/leadership Employee performance 3100% development reviews/other 2600% incentives 91% 50% 50% White collar an 6300% 5000% 96% - Sales, Clerical 72% Suppliers 2400% White 1900% collar 60% - Professional, 63% Managerial 74% illed 6000% Employee performance 4600% reviews/other incentives Interactive Games 50% 52% 68% Resellers 1300% 1400% 55% Board of Directors 3100% 2600% 63% 91% 30% Interactive Games No formal programs 52% White collar 44% - Sales, Clerical 72% 2400% 1900% 11% 63% 55% Formal No CEO/senior formal programs mgmt development Service workers 4% 68% 1300% 1400% 44% 44% Board of Directors 11% 10% 30% Formal CEO/senior Management/leadership mgmt development development 7% 63% 4% Blue collar - Craftsman, Foreman 8% 63% 50% 10% Other Service workers Management/leadership development 7% 6% 44% 60% 8% Blue collar - Semiskilled, Unskilled 63% 46% Other Blue 6% collar - Craftsman, Foreman 50% 31% Headquarters Region Business Partners 60% 26% Blue collar - Semiskilled, International Unskilled Region reach 46% Headquarters Region 24% Suppliers International Region 31% 19% Business Partners 26% 13% Resellers 14% 100% 24% Suppliers 19% 100% 75% Resellers 13% 14% Headquarters International ific Asia/ Pacific Africa Africa Middle East 75% 50% 25% Middle East 0% 50% 25% 0% The global breakdown of survey results on this question also demonstrates a pattern of Headquarters concern. Each type of workforce International in international regions reached fewer regions with ethics and compliance educational % Respondents programs than in their home market. Of course, this may reflect only logistical issues in reaching such international workers, or it may reflect that lack of resources companies cite as their leading challenge. This same decline in reaching global field offices was also the case in 2007, indicating a possible trend to watch, as well as a caution to companies to make better efforts to equalize their educational efforts. % Respondents 10. What are the biggest challenges you face in providing ethics and compliance education and/or certification activities/programs Inadequate resources lead the challenges to education and certification programs. Top Challenges Top Challenges liance Educational Programs Outreach tional Programs Outreach % Respondents 50% 75% 100% % Respondents 75% 100% % Respondents 0% 20% 40% 60% 80% 100% % Respondents Inadequate resources 58% 0% 20% 40% 60% 80% 100% Making the education relevant 43% Inadequate resources 58% Cultural differences Making the education relevant 43% Regulatory differences 31% 25% Cultural differences 31% Low employee engagement/interest 25% Regulatory differences 25% Knowing all our compliance risks 23% Low employee engagement/interest 25% Lack of E/C materials in some risks areas 22% Knowing all our compliance risks 23% Technology constraints 21% Lack of E/C materials in some risks areas 22% Lack of translated E/C materials 19% Technology constraints 21% Low leadership support 18% Lack of translated E/C materials 19% No challenges Low leadership support 18% Union objections 9% No challenges 10% As in 2007, more than 50% 10% of respondent companies do not have enough resources in Union objections 9% LRN | 2008 Ethics and Compliance Risk Management Practices Report | 30
DETAILED RESULTS terms of budget and staff to drive their ethics and compliance education and certification programs. This result may be reflected in why companies employ less classroom education, interactive workshops or site visits than other types of prevention programs that require fewer resources. It may also relate to why companies are not reaching their business ecosystem and why global companies face greater challenges at their international locations than headquarters. The antidote to this finding is for ethics and compliance functions to reach out to other departments within the organization to enlist their support for quality prevention programs. Making education relevant and low employee engagement / motivation are significant secondary challenges. The challenges related to making education relevant and combating low employee engagement and interest will be critical issues of the future, especially as more Millennial generation workers join the workforce and blend with the current generation of boomers whose learning and work styles are different. Companies will likely need to alter the methods they most often use to appeal to this generation. orting Methods for Global Companies ds for Global Companies Increased globalization accounts for several other key challenges: cultural and regulatory differences as well as translations of ethics and compliance materials. The lack of resources may be at issue behind this gap, but regardless, companies will need to gain ground to ensure they educate all relevant employee groups, regardless of cultural or educational background, language spoken, or location. DETECT 11. What are the methods you provide for employees and others to report ethics or compliance violations Almost 9 in 10 companies offer multiple means for reporting potential ethics or compliance violations. Reporting Methods Available to the Workforce Reporting Methods Available to the Workforce % Respondents % Respondents 0% 20% 40% 60% 80% 100% 0% 20% 40% 60% 80% 100% First Reporting Channel First Reporting Channel Supervisor Supervisor 93% Human Resources Human Resources 92% Anonymous/Confidential Reporting Channel Anonymous/Confidential Reporting Channel 91% Ethics & Compliance Office Ethics & Compliance Office 88% Legal Department Legal Department 86% Internal Ombudsman Internal Ombudsman 40% No set policy No set policy 17% 93% 92% 91% 88% 86% 40% 17% % Respondents % Respondents 10% 20% 30% 40% 50% % 20% 30% 40% 50% LRN | 2008 Ethics and Compliance Risk Management Practices Report | 31 Reporting Methods for Global Companies Reporting Methods for Global Companies
Page 1 and 2: ® Inspiring Principled Performance
Page 3 and 4: EXECUTIVE SUMMARY Increased global
Page 5 and 6: EXECUTIVE SUMMARY LRN’s Approach
Page 7 and 8: KEY FINDINGS To address these conce
Page 9 and 10: KEY FINDINGS 10 companies also offe
Page 11 and 12: 20 SIGNIFICANT RISK MANAGEMENT TREN
Page 13 and 14: 80% 52% 58% 60% 40% 20% TRENDS 42%
Page 15 and 16: TRENDS ondents man 900% 000% Respon
Page 17 and 18: Why Ethics and Compliance Risk Asse
Page 19 and 20: Educating a Diverse Workforce An In
Page 21 and 22: Avoiding the Pitfalls of Detection
Page 23 and 24: 2008 DETAILED RESULTS DEFINE 1. Is
Page 25 and 26: Function 2008 Compliance 6300% Lega
Page 27 and 28: DETAILED RESULTS Lack of adequate r
Page 29: Ot Workforce Outreach Workforce Out
Page 33 and 34: Anonymous/Confidential Reporting Ch
Page 35 and 36: Top Challenges %Respondents No sign
Page 37 and 38: DETAILED RESULTS uantitative measur
Page 39 and 40: DETAILED RESULTS Quarterly 4100% An
Page 41 and 42: DETAILED RESULTS It’s also a posi
Page 43 and 44: LRN ETHICS AND COMPLIANCE MARKET MA
Page 45 and 46: ,000 es r 5,000 loyees an 2,500 s t
Page 47: RESPONDENT PROFILE Level of regulat

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