Employee Hotline, Part IV

Key Messages
As mentioned previously, communication about the hotline should ideally help create and maintain an ethical workplace. A communications team that includes top management should be involved in developing an ongoing ethics communication campaign. This is essentially an advertising campaign that seeks to inspire a certain behavior within your financial institution.

As with any advertising campaign, the first step is deciding which behaviors are desired and the key messages that will help motivate these behaviors. Your initial communication with your employees should include:

• Behaviors that are expected (i.e., conducting business in a legal and ethical manner)
• Behaviors your financial institution does not condone (i.e., illegal and/or unethical behavior)
• What to do if you are aware of unacceptable activities. This aspect of communication must include information about all of the available avenues for reporting unacceptable behavior. This ensures that your employees are aware of their options.
• How to access the anonymous hotline
• What happens when you call the hotline

This communication should educate employees and motivate them to report their concerns. The message should be delivered through vehicles such as posters in break rooms (in branches as well as in all departments in operations), articles in employee newsletters and on your corporate intranet sites. There is an added 'soft benefit' to communication; it reinforces the employee's perception that the company really wants to know about illegal and unethical activities, and it helps an employee decide to make the call.

Employees may also need special communication from the financial institution explaining the nature of issues related to Sarbanes-Oxley. These materials should define terms like "accounting irregularities", which may not be clear to all employees. Topics should include improper loans to executives, accounting irregularities, conflicts of interest and whistle blower retaliation. Finally, these materials should emphasize that the Sarbanes-Oxley Act makes it illegal for the financial institution to retaliate against an employee who reports account or audit irregularities. It isn't just managerial employees who report fraud. Support personnel like administrative assistants, customer service, tellers, operations personnel, or building maintenance staff may be aware of unethical behavior, so it's important to communicate clearly to everyone about unacceptable behaviors.

Although ethics can be a sensitive topic, an experienced hotline provider can assist the financial institution in developing effective messages and vehicles for launching the hotline. They can also help you develop an appropriate plan based on the unique needs of your organization.

Launching the Program
Like any new initiative, a hotline requires the proper launch in order to be truly successful. The initial communication to employees should include an announcement from top management about the program's goals and the reason for implementing it. This helps set the program's tone by indicating that top management truly supports it. Employees should be told the financial institution is providing them with every opportunity to report problems, and the information they report will be sent to top management and/or the Board of Directors. In addition to posting the information as suggested above and including it on your intranet site, it should also be introduced in face-to-face meetings wherever practical.

Every employee should receive a letter or flyer announcing the program. Ideally, this packet should include a card that he or she can keep in a wallet or purse as a reminder of the phone number. Remember, nearly half of hotline calls happen outside of normal business hours, so it is critical to help employees keep the number handy.*

New employees must receive this information as part of their orientation. Managers throughout the financial institution should receive an implementation guide that informs them about the program, helps them encourage employees to use the hotline, and prepares them to handle questions employees might have.

Calls From 'Outside'
Hotlines are a well-established tool for detecting fraud, and the best return on investment from a hotline comes from focused communication beyond just your employee base. As mentioned in Part I of this series of training pages, over 25% of tips about fraud come from employees. But almost 20% come from vendors, customers, or unknown sources. For instance, if your financial institution is being swindled by a supplier, there are employees working for the supplier who know about it and who may be bothered by the illegal activity. Listing the hotline number on checks issued to suppliers is an inexpensive action that has helped uncover fraud for many companies in the past.

Public corporations should also inform investors about the hotline as part of their communication about the approach to Sarbanes-Oxley compliance. This action tells shareholders you have complied with this aspect of SOX and validates the corporate commitment to uncovering fraud, as well as offering investors a convenient way to communicate their concerns.

Keep the Hotline 'Hot'
A hotline produces stronger results if communication to employees about their options for reporting issues is strong. Historically, there is a well-defined pattern of activity that follows the rules of advertising: When a tool is publicized, people use it for awhile, and then they forget about it.

Periodically reminding employees, suppliers, etc., about the use of the hotline for reporting unethical behavior increases usage and helps the financial institution uncover a variety of issues that can threaten profitability or reputation. Just as it is important to provide options for reporting concerns, it is equally important to make sure employees are aware of those options. Program maintenance communication is the most often overlooked component of a hotline program. The best way to ensure it is not overlooked is by planning communication at the time the program is launched and each year thereafter.

*Editor's Note: In view of hurricane disasters in recent weeks, banking security directors who have learned through experience suggest it might be advisable to also include emergency telephone numbers on this laminated card.

To be continued - Our thanks to THE NETWORK for providing us with Best Practices in Ethics Hotlines and for their permission to use it.

Copyright © 2005 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 15, No. 9, 9/05