Defining Good Ethics & Compliance KPIs
A good question to ask yourself when assessing the effectiveness of program is what ethics and compliance KPIs do you need to consider?
Before we get to that, we should take a step back and address why it is important to look for program KPIs in the first place. Back in 2002, the Department of Justice issued Opinion Letter 02-04, which discusses some of the practices that the Department was looking for at during the early 2000s. It specifically talks about the value of having someone from outside of your program examine it periodically (i.e., every three years) to identify potential blind spots or areas for improvement.
This guidance is in pursuit of proving the effectiveness of your program in the absence of a major disaster. In the event that you do have a major issue and you get credit from the Department of Justice for the quality of your program, then you have the proof you need. But fortunately, most organizations will not find themselves in that situation. So they have to come with ways to demonstrate that their ethics and compliance programs are effective without something really bad happening first.
This is why it is important to set ethics and compliance KPIs. These KPIs show how your program is making the impact you want. The best KPIs to consider come in two basic categories: activity metrics and performance metrics.
Activity Metrics:
- Most programs are very good at producing activity metrics such as :
- Hotline call volume
- Case management system days to close
- Substantiation rates
- Anonymity rates
- Willingness rates for reporters to identify themselves once they engage with an investigator
- Policy clicks
- Communications clicks
These activities are absolutely worth tracking. If you are not tracking them currently, then consider setting up formal processes for capturing that data. In the meantime, look at what data you can obtain already that reflects those kinds of activities associated with your ethics and compliance program.
Performance Metrics:
This is a trickier metric because it seeks to answer more nuanced questions, such as:
- How do you measure an employee pausing and asking for help?
- How do you measure an employee refusing a kickback request?
- How do you measure an employee going to their manager and figuring out the right response to a particular situation they find themselves in?
Every organization is going to be a little different in terms of how frequently those moments occur, but they are definitely the kinds of E&C metrics you want to measure. This may entail asking managers to give you information on ethics and compliance questions that come to them through employees—that’s not really an activity, metric that’s more a performance metric.
