In December 2022, the Business Ethics Leadership Alliance’s Training Effectiveness Working Group published Effective Employee Education: Training and Communications for the Current World of Work, a white paper that explores how ethics and compliance officers can ensure that their training programs are innovative, engaging, and impactful. Susan Divers of LRN—who played a key role in both the Working Group and its report— weighs in with some further thoughts on what is holding back compliance training, and how programs can embrace new state-of-the-art tools and techniques that will bring their training to the next level.
For those in the audience who are unfamiliar with BELA Working Groups, could you give an overview of the Working Group behind this particular report? What problem or challenge did the group convene to address, and how did they bring their collective expertise to bear to craft a solution?
I was active in BELA when I was a chief ethics and compliance officer, before I joined LRN, and it is a forum for best practices that brings together some of the best and the brightest people who think about ethics and compliance as an issue, and who are doing a lot of innovation to improve their ethics and compliance programs.
The BELA Working Groups and the reports they generate are a really amazing feature of BELA. The working groups can zero in on specialty topics that are of interest in the whole community. When [Ethisphere CEO] Erica Salmon Byrne and I have talked about compliance training in the past, and when we’ve talked to our clients at LRN about it, one of the most difficult areas that keeps coming up is figuring out if a training program is effective and impactful. It’s very easy to have a training program that rolls out 12 hours of mandatory courses a year, and then say to your board or your leadership that you have 90% completion as an accomplishment. But what we’ve seen in the last 10 years is that doesn’t necessarily mean that people change their behavior. It’s a bit like throwing flower seeds out the window and hoping they sprout.
There’s an anecdote in our report about a Morgan Stanley financial services trader who had been trained an amazing number of times and he still engaged in misconduct. So that question of what the most effective training is, and how to measure impact, is at top of mind for a lot of people in ethics and compliance today. That is what this Working Group set out to address and what the white paper we created gets into.
How would you characterize the state of ethics and compliance training right now? As an area that is more defined by its challenges, or by its opportunities?
I would say that it is at a tipping point. In the past, there was a real focus on shoveling content toward employees without a huge amount of regard to whether it was having any real impact on them. That focus has changed, especially over the course of the pandemic. Among the best companies, it’s no longer about including the biggest amount of content they can manage and hoping that something happens with it. It’s about focusing on the employee experience. What is the best way for the employee to learn? What does the employee really need to learn?
One of the many good analogies that came up in the working group is one of the participants noted that not every airline employee needs to take pilot training. That says it all, doesn’t it? There’s much more of a focus on employees now, and whether training actually helps them avoid misconduct. That’s a big change.
Another big change is that there’s a recognition that less can be more. Really focusing on messages that resonate, particularly values-based training, is much more effective than a 45-minute lecture on the intricacies of the Foreign Corrupt Practices Act. I used to call that Soviet-style training because it read like a Russian manual for how to fix a truck. Good luck figuring that out!
And finally, regulators are pushing for more focus on impact and effectiveness, away from checklists or “paper compliance.” The Department of Justices’ June 2020 Program Effectiveness Guidance makes clear that E&C teams need to be able to show whether their programs are impactful and effective, not just that they do training or have policies.
So, those things have changed, and people are in the ethics and compliance community are much more focused on delivering training in ways that the employees can relate to. A good example of that is short-burst learning. That approach takes a particular topic and encapsulates the key messages around it, rather than focusing on a long course.
Another example is modular learning. For LRN courses, when you log into a course, there’s a series of modules, and if you’re in a hurry and need to know, for example, what the gifts and entertainment rules are for foreign government officials, or hiring third parties, or recordkeeping…you can click on that module first and go back and complete the rest of the course later. That kind of modular approach is really good because allows people to go in, do maybe one or two modules and if something comes up, they can pause their training and go back in later and do a refresher.
Another thing is just-in-time training. LRN’s mobile app can be set up so that if someone is traveling to, say, China, when they land at the airport and turn on their phone, they get a message saying, “Would you like to review the gift and entertainment rules for China? Or take this short training segment?” That is much more impactful than throwing the kitchen sink at people.
Also, the latest Department of Justice guidance shows regulators are beginning to recognize that training that is tailored by role and more focused, as opposed to the kitchen-sink approach, is a good thing. I think we’re turning the corner on that, hopefully.
The critical thing is to inform, to instruct, and to really get people to absorb what you’re trying to teach them.
We still see a lot of training programs that continue a traditional approach, with an extensive curriculum of classroom training—including three-hour marathon courses. But now that we are seeing how shorter and more self-directed training is a more efficient approach, to what degree so organizations have to get past a certain cultural resistance to moving away from traditional long-form training?
One of the benefits that the BELA community provides is to help educate people (such as regulators) that chaining people to their computers for a full hour with a very repetitive course with mind-numbing detail is not particularly helpful. But the research shows that approach really doesn’t work in a professional setting. Some of it may stick, but what works much better is shorter, more self-directed training that is more relevant to your role.
There is an interesting section in this report on adult learning theory as a way to frame modern compliance training programs. Could you talk about that a bit?
That’s definitely something that companies like LRN care about. That kind of approach doesn’t assume that dumping the kitchen sink on someone is really going to work. Rather, you pick your key messages, and then learn it, prove it, use it.
Our courses usually include quizzes interspersed in the course, so you’ll be taking a course, and rather than wait till the end. a quiz will come up. Some of them are pretty challenging, and they really make you think about what you learned (or didn’t). If you get them wrong, then you have to go back and answer it the correct way. That approach helps make the training stick.
We also recommend using “test out.” It allows an employee who believes they know an area to say “I’m going to test out and not have to take this Foreign Correct Practices Act course.” If they pass, great, they can be directed to a shorter, more advanced refresher. But if they fail to test out, they are really going to pay attention to the course content. as they have had a somewhat sobering experience around the limits of their knowledge. That makes the training much more effective traditional lecture format.
Another important area is customizing online training to look and feel like the employee experience. Our enhanced course customizer, Catalyst Design, lets E&C teams edit online training the same way they do Word documents. You can swap in examples of challenging situations or other company relevant content with a few clicks.
What are your thoughts on how data analytics can drive better training outcomes?
I think this is the most important development in the past 10 years in the E&C space. It allows E&C teams to get data in real time about impact and effectiveness, the Holy Grail of compliance. At LRN, we just launched a new version of our training platform that has tremendous analytics capabilities as well as other powerful tools that enable E&C teams to do more with less and do it effectively. The new platform includes a function called Reveal that provides an integrated dashboard of real time data.
One component of that is Reveal.
What Reveal does is, let’s say you have 13,000 employees, and they’re all taking four courses a year. You’re able to see at a glance in a dashboard how long people are taking to complete specific modules or topics. That in and of itself is interesting. If you look, and you see that people in Latin America are taking twice as long as people in Asia to complete Gifts and Entertainment, that’s a clue to something.
And, if you see that, that the failure rate on the quizzes is much higher in a particular region or a particular topic, and maybe that correlates to taking more time to complete that module, that’s real-time information that helps inform your program. You can also see at a glance what questions caused the most wrong answers and what topics your employees find most difficult. You can benchmark over time and identify trends as well as get real-time employee feedback in end of course surveys (see the word cloud below).
With our powerful dashboard, you can compare with just a few clicks against how you did last year, by employee function, region, or business line. We also have an integrated disclosures function that will identify whether required disclosures, for example, conflict of interest spike after employees take a conflict of interest course—that’s evidence of impact. Our Reach capability allows E&C teams to launch supporting communications to reinforce key training messages. And measure how many clicks they receive. That type of analytics is much more predictive than the old kinds of measures for ethics and compliance programs where people just looked at the number of training completions and number of courses, number of hours, and all of that. This gives you real insight into what’s happening.
And, the Department of Justice recently hired Matt Galvin, who, as CECO of Anheuser-Busch InBev, pioneered data analytics as the foundation for measuring E&C program effectiveness. That means that companies meeting with DOJ to resolve and address misconduct issues should have robust and meaningful analytics as part of their programs.
How important is it to focus on the crafting of the training presentation itself? It seems that sometimes, training courses focus so much on program structure and length, but perhaps overlooks how clearly it communicates intent and expectations to the students.
That’s a very good point. We were fortunate to have an expert instructional designer in our BELA working group, and there’s a whole section that she contributed, which is included in the in the white paper. Very clearly defining what it is that you want people to acquire through the training, and then designing the course to that, is one of the key principles. As I mentioned earlier, LRN’s Catalyst Design tool allows E&C teams to get the benefit of our updated, broad content, modular approach and key analytics while customizing courses and content with a few clicks.
Focusing on values-centered messages is critical. If you’re taking a training on diversity, equity, and inclusion, for example, a lecture on the code of Federal regulation is unlikely to impact behavior. Focus instead on respect and fairness and what the main principles are and what the behaviors are that I need to adopt, and then ask participants to apply the lessons. This is part of the shift in emphasis on the employee experience rather than just throwing content over the fence and hoping something grows.
As a representative of LRN, you played an especially important role in crafting this report. When it comes to best practices in compliance training, are there any particular challenges or opportunities that you are seeing that this Working Group didn’t get a chance to explore?
We just are publishing our annual Program Effectiveness Report, which I write every year. This year’s report is due out in early February. One of the things that was somewhat surprising in this year’s report is that we asked people what the biggest obstacle was to improving their programs. Our survey included 1,860 ethics and compliance professionals around the world, across all kinds of programs. And the number one obstacle was they had internal systems that weren’t adequate, whether it’s a training platform or a web-based system. I see that in my practice at LRN all the time, and I still find it shocking. Name-brand companies, even within the Fortune 100, have internal systems that aren’t very user-friendly and don’t enable them to scale their efforts, especially if they’re using LMSs that don’t have a lot of functionality. Best practice is to make your Code of Conduct and policies web-based and searchable, easy for employees to find, and able to display who hits what section of what policy. A good platform can make so many aspects of E&C programs easier from training to disclosures, to communications and any follow-up.
You’d be surprised how many companies don’t have a web-based, robust way to track disclosures, and some do it manually by excel spreadsheet. When you think about it, this is a time when most programs don’t have enough resources and enough staff, so having to do something like that manually is crazy. We didn’t have a chance to talk about that in the report.
One of the many things I like about working at LRN is that our platform is powerful and really state-of-the-art, and it can do a lot of things. It can do things for the communications department, like help roll out sequenced communications, track who opens them, who reads them, how much time people spend on them. Not having a robust platform is sort of like the IT security equivalent of not having good firewalls. It can really hold you back.
Any closing thoughts?
One of the things that we saw in this year’s Program Effectiveness Report is a really striking correlation between program effectiveness and companies that have boards of directors that are trained in ethics and compliance (more than once—not just during onboarding) or have ethics and compliance expertise. In such companies the ethics and compliance programs tend to have more resources, better standing within the company, and have better cooperation from other parts of the company. That is quite a multiplier.
In my own experience, working with boards at LRN, and I find that they don’t really understand that you need to invest in the infrastructure of programs. They often think, “We have a great policy, we have great procedures, so we’re good to go.” And it doesn’t work like that. Things are always changing in this area, and I think it is a really important part of the Board’s responsibility here to make sure that you’re keeping up with best practices, and that you’re investing in things like good internal systems and data analytics Those things are key components of any good ethics compliance program.
This article appears in the Winter 2023 issue of Ethisphere Magazine. To download a PDF of the issue, click here.
About the Expert
Susan Divers is Director of Thought Leadership and Best Practices, at LRN, a leading advisory and education firm specializing in ethics, regulatory compliance, and corporate culture. Susan brings her 30+ years’ accomplishments and experience in the ethics and compliance area to LRN partners and colleagues. This expertise includes building state-of-the-art compliance programs infused with values, designing user-friendly means of engaging and informing employees, fostering an embedded culture of compliance and substantial subject matter expertise in anti-corruption, export controls, sanctions, and other key areas of compliance.