Women and the board, data privacy legislation, corporate activism, and more.
Each week, Convercent will highlight some of the top stories and most newsworthy events in the ethics and compliance industry. The focus is global, but you might be surprised by how relevant these stories are, both across borders and businesses.
In 2017, women accounted for 38.3% of all newly named directors at Fortune 500 firms. It’s the biggest year for board appointments of women since executive-search firm Heidrick & Struggles started tracking this data in 2009.
This is excellent news, but there are some caveats: “Despite the sharp increase in women’s appointments in 2017, Fortune 500 boards remain a long way from gender parity. Heidrick & Struggles predicts we won’t see an even split in appointments for men and women until 2025, based on an extrapolation of the data using a three-year trailing average method. And that’s just for new directors. The portion of all Fortune 500 company board seats held by women in 2017 was just 22.2%, an increase of only 1.2 percentage points from the previous year.”
If you’ve been following the conversation around data privacy, including the GDPR, this is an interview you won’t want to miss. Senator Wyden (D-Oregon) helped co-author Section 230 of the Communications Decency Act, a piece of 1996-era legislation that limited internet companies’ liability for what was posted on their platforms by third parties.
For better or worse, Section 230 gave us the Internet we know today, including Facebook. Now, Sen. Wyden has some thoughts on how the U.S. can move forward:
“[If] Congress and the country were to give Facebook a pass after what’s happened in the last few months, I think it would be like setting up a sign, ‘Open for business. We’re really not going to fight you if you exploit consumers and use their data in a way they consider hostile to their interests.’ ”
Internal reviews found that four top Georgia Tech officials had improper relationships with vendors, misused resources, and/or violated additional ethics rules or state laws. Now, the four officials have all been outed or have resigned.
Investigators have made suggestions about changes to implement, including an “ethics audit” or similar assessment. Here, the goal would be to thoroughly assess the ethical tone across all of Georgia Tech.
We’ve talked about mining giant Glencore’s recent scandals, but the fallout continues.
As the Irish Independent stated, “One thing is certain, however. If accusations of corruption, money laundering and doing dodgy deals with highly questionable regimes in hot countries are being hurled around – as they have been against the huge international mining group Glencore – and the accuser is a powerful institution like the US Department of Justice, you are bound to see it in the share price.”
China exerts heavy-handed censorship over Internet usage.
But, in some ways, the regime is no match for the power of the #MeToo movement. Recently, several Chinese women have come forward with accusations of sexual assault and harassment. Well-known Chinese journalists, intellectuals, and charity leaders have been named.
Even as government sensors are banning the English #MeToo hashtag, the conversation continues. According to one professor quoted in the article, “Censorship can only stop public discussion for awhile … When something big happens again, it will come back.”
For an inspiring read about the importance of empowering employees in an increasingly ethically aware world, don’t miss Convercent CEO Patrick Quinlan’s recent column in Forbes.
“For leaders, shifting gears to focus on people first may feel scary. No one wants their employees to point out something is wrong at the company. But if instilling core ethical values is truly your objective, openness to criticism is part of the job description. Your commitment to promoting a safe, empowering space is not only beneficial for your employees — it ultimately strengthens your company’s culture, values, ethics — and therefore your company’s success long-term.”
In recent months, there’s been a greater emphasis on Corporate Social Responsibility (CSR) in the ethics and compliance industry (be sure to read Patrick’s article from Forbes, which details a few relevant examples).
Taking a stand on issues that matter is one way ethics can be used in business to help make the world a better place, but how far is too far?
That’s the question a New York Times author is asking about WeWork’s recent announcement that it will no longer serve red meat, pork, or poultry at company functions. Further, it won’t reimburse employees who want to order meat.
The decision was primarily driven by environmental concerns. However, there’s another way to look at it. As Laszlo Bock, the former senior vice president of people operations at Google and the author of “Work Rules!” explains, “Human beings really don’t like when you take choice away from them … What people are much more amenable to is nudges. How can you change the environment [so that it] doesn’t remove choice, but sends a signal for people to make a good decision?”
Bock’s recommendation doesn’t mean companies shouldn’t take a stand on issues they feel strongly about. He simply recommends using a proven psychological concept — “nudge” to budge behavior.
Convercent’s CECO, Katie Smith, recently shared her own thoughts on corporate activism with Compliance Week. She argues that chief ethics and compliance officers have a crucial role to play in how organizations take a stand:
“We have the potential to make an impact that extends far beyond our own offices. Whether an issue is brought to our attention by employees, a competitor, or external events, the role of the CECO is to look at it with a critical, ethical mindset, asking, “What is the greater good?” while also remaining cognizant of business and stakeholder concerns. It’s our job to ensure our companies and CEOs not only keep up with the ethical transformation happening in our world today, but respond to it in a way that serves both the larger good and the long-term health of the company.”