Industry Firms Share Best Practices on Ethics and Compliance
Compliance officers searching for construction-specific advice should not feel alone. Speakers who presented best practices for small- and mid-size firms at the Construction Industry Ethics and Compliance Initiative forum, held in Denver on Oct. 10-11, all shared the same experience: They started their careers in operations or legal work with no direct training in compliance. All reached out to CIECI as a resource for writing and maintaining industry-specific ethics and compliance programs.
CIECI was formed three years ago by 13 contractors and now has grown to 45 members, including engineers and specialty contractors. CIECI Chairman Bruce Grewcock, who is CEO of Kiewit Corp. and one of the charter members, said the group is actively seeking new members, although it screens candidates and requires the CEOs to send a letter stating their company is committed to ethical conduct. Two prospective members have been turned away.
The group's goals are both altruistic and practical. “We want to elevate the industry,” Grewcock said, “to mitigate the perception that the construction industry [as a whole] is corrupt.” Acknowledging that this is not a “mission accomplished,” the group holds best-practices forums twice a year to help firms facing increasing prosecutorial and legal scrutiny to understand “the right thing to do,” said Grewcock.
In one session, compliance officers shared tips on how they encourage employees to report violations and ask questions about company policies. “A non-retaliation policy” is essential to promote “two-way communication,” said Lorraine D'Angelo, the compliance officer for Dragados USA. Richard Wallace, vice president of compliance for Zachry Construction Corp., said he changed the name “hotline” to “helpline” and consolidated the company's 24-plus different phone numbers to just two phone numbers.
Zachry outsources the helpline to provide complete anonymity 24/7. On the other hand, Linda Stewart, compliance manager for Lane Construction Corp., says her firm uses an in-house hotline because the call-takers can answer many questions immediately. Lane encourages calls through posters, a newsletter about the program's results and by giving employees easy-to-carry, wallet-sized cards with the hotline number.
The CIECI sessions also have a leader-to-leader component, with top executives sharing experiences. Charles Harrington, chairman and CEO of Parsons Corp., said he tasked a senior executive to come up with quantitative measures of ethics and compliance as well as leading and lagging indicators. “Since we're a bunch of engineers, we make sure there is a statistical correlation between leading and lagging indicators. This is a big part of the compensation plan for all executives,” he said.
Parsons borrowed ideas from safety practices. Leading indicators include such points as how much training the firm has done and the percentage of its workforce that is trained. Just as with safety, “we decided to give a lot of credence to ethical near misses,” he said. The concept is that if employees spot things that they decide to call in to the ethics hotline and ask, “Is this an issue?” that means ethics is on their minds and “that's a good thing and should be recorded,” Harrington said. Lagging issues include such things as number of fines and issues under investigation.
Mike McKelvy, president of the government, environment and nuclear division of CH2M Hill, said, “CIECI is important to us because we need to work together to increase the standard of ethics and compliance across the industry. It's a challenge to hold this in the forefront in tough economics times, but if we put our heads together, we can” keep business strong while still “adhering to our ethics ideals.”