Although the general counsel and chief ethics and compliance officer’s role in identifying and mitigating risks at a company is always important, it’s particularly vital for a company in transition. U. S. Steel’s Duane Holloway knows this well, and he talked with Ethisphere’s Tyler Lawrence about the importance of open and transparent communication in times of transition.
Tyler Lawrence: U. S. Steel underwent a major reorganization of its business units in the last few years. Can you tell me a bit more about what changed?
Duane Holloway: We’re in the midst of a multi-year transformation that is focused on creating value for all of our stakeholders. That includes employees, customers, stockholders, and the communities in which we do business. Our aim is to earn the right to grow, and then sustain profitable growth across business cycles. We think of “Earning the right to grow” as delivering consistent, reliable results by achieving operational excellence through an intense focus on what we consider our key business drivers: safety, quality, delivery, and cost.
From a transformation perspective, first we have undertaken a variety of projects to help improve our performance across our core business processes, including supply chain, manufacturing, innovation, and others. Many of these efforts focused on changing and streamlining processes. Our workforce has driven many of these continuous improvement projects, and their efforts helped foster a corporate culture where accountability, integrity, and high performance are valued and celebrated. Second, we realigned our North American flat-rolled operations into new commercial entities to service key markets, which are automotive, consumer, and industrial, service centers, and mining. This has helped us get closer to our customers so that we better understand their needs and can collaborate with them on high-quality, innovative solutions. One more point is that we are investing in strategic revitalization of our assets and reliability-centered maintenance initiatives that will help us maximize efficiency and production.
TL: In the midst of all of that, how do you see your role as general counsel and chief ethics and compliance officer in that transition?
DH: My team and I play an integral role in supporting and helping facilitate our ongoing transformation. One of the primary functions of the legal and compliance department is to identify risks to the company, and work closely with our colleagues across the company to mitigate them. We also identify opportunities for business growth. And as the leader of our ethics and compliance program, I think I also play a key role in helping to ensure that our strategic plans and the initiatives undertaken to achieve them remain rooted in the core values that have guided U. S. Steel since our founding more than 115 years ago. Among these are a steadfast commitment to safety as our primary core value and an unwavering commitment to doing business ethically and with integrity. I take great pride, despite my short tenure here, in U. S. Steel’s long, rich tradition as an innovative and responsible corporate citizen.
TL: What are the main priorities, both personally for you as the GC and CECO and for your team, during the transition?
DH: Beyond ensuring we stay committed to our values in order to effectively support the transformation, I think, first, everyone must understand the reasons for the transformation and the company’s ultimate strategic goals. We need to understand the business and its objectives in order to effectively provide high-quality guidance, without exposing the company to undue risk.
Second, we need to constantly strive to create stronger and more collaborative relationships with our colleagues. We must be and remain trusted legal and business advisors to those throughout the company so that they seek out our advice and counsel. Third, as we are in an era of transformation, we need to be agile, embrace change, and be innovative in our thinking. We also need to be sure we bring diverse viewpoints to the table. Fourth, we need to have fun. We all work hard, but we work better and smarter if we enjoy the work we’re doing with our colleagues. I think all of these points go hand-in-hand.
TL: You say that one of your priorities is developing strong, more collaborative relationships with your colleagues. For you as the general counsel, what does that look like? Who are you talking to?
DH: As part of my onboarding, I made sure that I had informational meetings with each of the business segment leadership teams in addition to all the functional segment leadership teams. On an ongoing basis, I make sure that I am out there in the business, if you will. That includes visiting and touring our steelmaking and finishing facilities and participating in business meetings. And I spend a significant amount of time with my colleagues in the C-Suite so that I understand the issues that they are facing. It’s a constant process of communication and knowledge sharing.
TL: The organization has been underway with some of these changes for a few years, but if you were the GC or the CECO of an organization that was just starting major organizational change, how would you prepare the legal and compliance team?
DH: I think communication is absolutely critical. As GC and chief ethics and compliance officer, I’m often in a position to be one of the first folks to understand what changes are happening to our corporate strategy, including significant developments that could impact the legal and compliance team, either directly or indirectly. And while it’s not always possible to immediately share developments, I strive to let those on my team who may be impacted know as early as possible. I think the sooner that our subject matter experts can start to dig into a matter, the more time there is to fully consider any issues or risks. We have to be agile and enable agility.
TL: You say communication is critical and you want to let the relevant people know as soon as possible. But in many companies, legal and compliance are the last people brought into the room. So how can you, as the GC, ensure that you have input early on in every phase of a transition like this?
DH: I think the most effective thing we can do to make sure we are not just called in at the eleventh hour is to develop effective partnerships with our colleagues where they view us as aligned and capable, trusted business advisors. I’m stressing business advisors because I think that’s a key point. In that vein, we must demonstrate that we understand and appreciate their goals, which also should be our goals, and then provide advice to help them achieve those goals while mitigating the risk to the company. I think when we do that, our colleagues will understand the value that we add and proactively seek our guidance going forward.
TL: You’ve touched several times on the importance of culture. During reorganization, that can often be disrupted. Culture is a fragile thing. So how do you preserve your culture during a transition?
DH: Preservation of culture during transformation is more of an art than a science. It’s essential to not only assure employees that the transformation process does not in any way change or limit our commitment to our core ethical values, but to show that. Communicating with the workforce about what is happening, why, and how it will affect them as early as possible can help make any disruptive changes easier to understand, and make the process more effective.
During transformations, there’s an opportunity to revisit the core ethos of a company, and in our case at U. S. Steel, it has reaffirmed a commitment to fostering a culture of caring, as we call it, which is characterized by accountability, fairness, and respect. It’s a constant theme. I think it’s inherent in any business transformation that you have to have those three things on the table. We do our absolute best to hold ourselves and others accountable, ensure we are as fair as possible, and respect and dignify each and every person in the workplace.
About the Expert:
Duane D. Holloway joined U. S. Steel in April 2018 and serves as Senior Vice President, General Counsel, Chief Ethics & Compliance Officer and Corporate Secretary. At U. S. Steel, Mr. Holloway holds executive responsibility for all legal, ethics and compliance matters across the company. He is also responsible for corporate governance and managing relations with the company’s Board of Directors.
