Skills and Qualities of an Effective Ethics and Compliance Officer

While ethics and compliance is often viewed as a singular function, it actually consists of two separate and distinct components. The compliance aspect is more straightforward; its role is to ensure that the organization is following all pertinent rules, regulations and polices. Ethics, on the other hand, is more abstract. It encompasses the values, morals and beliefs that govern the organization’s actions and define its culture.

In many organizations, the chief ethics and compliance officer (CECO) is tasked with the responsibility of overseeing both of these crucial functions. In terms of compliance, the CECO’s role is not dissimilar to that of a police officer; he or she must ensure that the organization is following the letter of the law and take any necessary enforcement actions. From an ethics standpoint, the CECO constantly assesses the organization’s “moral temperature” to ensure that employees and stakeholders are adhering to its established values.

Because of the multifaceted nature of the role, a CECO should possess a wide range of relevant skills and qualities including:

  • Passion for ethical excellence: The most effective CECOs do much more than simply create a list of rules and regulations and focus on punishing wrongdoers. They have a genuine passion for establishing a values-based organizational culture that is hospitable to individuals who share and live the values.
  • Communication: A CECO must have the strong verbal and written communication skills to interact with individuals at all levels of the organization, from the CEO and board of directors to the rank-and-file staff.
  • Networking: An effective CECO takes the time to establish a network of individuals at all levels of the organization. These individuals serve the role of helping the CECO understand the ethical realties that employees must confront on a daily basis, and will also keep him or her informed of any unusual behavior.
  • Collaboration: A CECO could easily develop the reputation as someone who is quick to say no whenever a new organizational strategy or initiative is unveiled due to ethics and compliance concerns. A strong CECO is able and willing to gain the trust of colleagues by working to find acceptable alternatives and solutions.
  • Practical rule-maker: It is virtually impossible to create a rule that applies to every possible situation. The best CECOs are able to identify the areas that offer the greatest risk potential for the organization and craft rules and procedures that target these areas.
  • Attention to detail: This is especially important for the compliance aspect, as the CECO must have a solid understand of the laws that impact the organization and keep a constant finger on the pulse of the regulatory environment.
  • Interpretation: Ethics issues in particular aren’t always black and white; the CECO must be able to interpret the spirit of the rule in order to apply it fairly and equitably in every situation.
  • Risk assessment: A CECO must understand the organization’s level of risk tolerance, and be able to assess alternatives and make sound decisions based on the potential for risk.
  • Seeing the big picture: The best CECOs are able to develop a strategic vision for the ethics and compliance program in terms of how it fits with, supports and operates in conjunction with all aspects of the organization.
  • Focus on continuous improvement: Ethics and compliance is not a static function. A capable CECO understands that as an organization evolves over time, its needs from an ethics and compliance standpoint also change. Therefore, a CECO must take a proactive approach to adapting and improving the organization’s ethics and compliance efforts.
  • Marketing: A CECO must be able to “sell” ethics and compliance initiatives to top management and throughout the organization. An effective CECO views the organization culture and the ethics and compliance programs that support it as a brand. As such, he or she should develop appropriate marketing programs to constantly deliver messages through various mediums that keep ethics and compliance in the forefront of employees and stakeholders thoughts.
  • Moral courage: As often-heard refrain in terms of ethics and compliance is “tone at the top.” The most ethical organizations have leadership that “walks the talk” by living the values. The CECO must have the courage to hold everyone accountable for their actions, including the CEO and board of directors and confront any and all offenders when necessary.

A CECO who possesses these skills and qualities can help an organization achieve its ethics and compliance goals, without becoming an impediment to reaching its business objectives.

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