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Governance, Risk Management, and Compliance: It Can't Happen to Us—Avoiding Corporate Disaster While Driving Success by Richard M. Steinberg

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Companies That Got It Right

There's no quick recipe or silver bullet for developing the right corporate culture. But I'd like to share a few of my experiences with chief executives whose actions have had a dramatic and long-lasting positive effect on their organizations, shaping their corporate cultures for years to come.

  • Insurance company. This major firm got caught up in a scandal involving improper sales practices and was working diligently to strengthen its system of internal control to help prevent future failures. It learned that a group of customer-service call-center employees needed to obtain requisite licenses to continue being paid on a commission (rather than salary) basis. Looking to do the right thing, the CEO announced that the group's personnel would immediately begin the necessary steps to register for and take the tests for licensing, and in fairness to those employees, commission-based payments would continue during the transition. Although he had good intentions, after discussion the CEO realized that the message received by the company's personnel was that continuing to break the rules is okay as long as there's a plan to come into compliance. Recognizing how the initial decision was being interpreted, he quickly changed tacks, shifting the group to a straight salary until licenses were secured. This company's culture soon reflected the message that not only is it necessary to work toward doing the right thing, but also to take what might be an unpopular action ...

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