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1 © 2014 NAVEX Global, Inc. www.navexglobal.com All Rights Reserved. Ǧ ǣ Ǧ ǣ 21 st of March 2016 © 2014 NAVEX Global, Inc. www.navexglobal.com All Rights Reserved. Share largest benchmarking data set in the Compliance and Ethics community and discuss best practices to strengthen your own practices in our respective companies and teams. Open and informal discussion sharing practical tactics, tools and case studies to overcome critical challenges in your ethics and compliance programmes. ʹ
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Page 1: æ ã...2010 Benchmark 2011 Benchmark 2012 Benchmark 2013 Benchmark 2014 Benchmark Repeat Reporters Repeat Reporters Repeat Reporters Repeat Reporters Repeat Reporters Repeat 24% Repeat

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©2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

21st of March 2016

©2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

Share largest benchmarkingdata set in the Compliance andEthics community and discussbest practices to strengthenyour own practices in ourrespective companies andteams.

Open and informal discussionsharing practical tactics, toolsand case studies to overcomecritical challenges in yourethics and complianceprogrammes.

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©2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

Introduction

Setting the Scene

Benchmark Results

Open Q&A and discussion throughout

© 2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

Employee Awareness

Standard & Ad Hoc Reporting

Expa

nded

Intake

INTEGRATED COMPLIANCE DATAINTEGRATED COMPLIANCE DATA

ADVISO

RYSERV

ICES

NAVEX GLOBAL GATEWAY

PROFESSIO

NAL

SERVICES

Case

Man

agem

ent

PolicyMan

agem

ent

Third

PartyRisk

Mgm

t.

Hotline

OnlineTraining

Annu

alCe

rtificatio

ns

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©2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

3. Increasing Operational Complexity:

Company growth depends on newproducts, technologies, increasingnumber of partner companies, andexpanded geographic reach

85% of your peers expect thecomplexity to increase

4. Intense Pressure from Stakeholders:

Senior executives are faced with—and exert— increased pressure forgreater risk assurances.

83% of your peers expect thepressure to increase.

1. Busier Regulators:

83% of your peers expect moreregulations in more regions aroundthe world

86% of your peers expect an increasein the scope of regulatoryenforcement

2. Higher Employee Exposure:

Greater access to sensitive companydata and more channels throughwhich that data might leak

72% of your peers expect thesetrends to increase

© 2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

• Fear of retaliation

• Fear of non anonymity

• Belief that report will be ignored

• Belief that someone elsewill report it

• Unsure of who to contact

• Lack of clarity on what can/should bereported

• Many other reasons…

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©2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

Source: Inside the Mind of a Whistleblower, 2012 – Ethics Resource Center

79%

75%

63%

49%

59%

46%

39%

24%

Don't report Report

Had an anonymousreporting option

Felt supportedbymanagement

Believed correctiveaction would occur

Felt that no one elsewould report incident

Believednothing would

occur

Fearedretaliation

Could not reportincident anonymously

Believed someone elsewould report the

incident

© 2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

Corporate Culture

Risk Management

LowerComplianceMisconduct:

Improved RiskDetection:

Business Performance

Higher EmployeeProductivity:

Better StrategicManagement:

ImprovedBusinessPerformance:

Source: CEB

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©2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

74% 73%Organisational

Justice

26% 27%

Definition

•••••

Drivers ofa Culture

ofIntegrity

2008 2009

©2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

• So much data, but notalways clear what it means

• Need to demonstrateprogramme effectiveness

• Reportingmeaningful andactionable data toleadership

• Comparing yourperformance to peers andothers

• Finding context

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©2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

N AV E X G l o b a l B e n c hm a r k i n g

© 2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

• Report Volume

• Report Categories

• Repeat Reporters

• Anonymous vs. Named reporters

• Follow up Rate

• Substantiation Rate

• Anonymous Substantiationpercentage

• Case Closure Time

• Reporting Intake Method

• Retaliation Reports

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©2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

2010 Benchmark 2011 Benchmark 2012 Benchmark 2013 Benchmark 2014 Benchmark

Call Volume Per 100Annually

Call Volume Per 100Annually

Call Volume Per 100Annually

Call Volume per 100Annually

Call Volume per 100Annually

Median 0.9 Median 1.1 Median 1.2 Median 1.2 Median 1.3

Range 0.2 3.9 Range 0.3 6.0 Range .4 4.9 Range .5 4.0 Range 0.3 8.3

The 2014 median rate represents a 44 percent increase in the Report Volume per 100Employees over the previous five years.

Source: NAVEX Global's 2015 Ethics and Compliance Hotline Benchmark Report

Too many calls isnot good news…

Too few isn’tgood either

The 2015 median rate remained flat at 1.3 reports per annum per 100 Employees

© 2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

Source: NAVEX Global's 2015 Ethics and Compliance Hotline Benchmark Report

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©2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

Allegation Categories 2010 Median 2011 Median 2012 Median 2013 Median 2014 Median

Accounting, Auditing &Financial Reporting

3% 3% 3% 3% 2%

Business Integrity 17% 16% 17% 18% 17%

HR, Diversity andWorkplace Respect

69% 68% 69% 73% 69%

Environment, Health andSafety

7% 9% 7% 7% 6%

Misuse, Misappropriationof Corporate Assets

5% 7% 6% 6% 6%

Source: NAVEX Global's 2015 Ethics and Compliance Hotline Benchmark Report

© 2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

Source: NAVEX Global's 2015 Ethics and Compliance Hotline Benchmark Report

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©2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

Source: NAVEX Global's 2015 Ethics and Compliance Hotline Benchmark Report

There has been a significant increase of inquiries over a five year period.

© 2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

Source: NAVEX Global's 2015 Ethics and Compliance Hotline Benchmark Report

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©2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

100%

40%

60%10%

Source

CEB Compliance and Ethics Leadership Council

© 2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

Source of frustration for ethicsofficers and senior leadershipbecause of missing data andinability to talk directly with thereporter

Senior leaders often push back onaccepting anonymous calls due to:

Fear of malicious calls

Fear of inability to resolve case

Strong belief that reporters withreal issues should be willing to givetheir name

E.U. requirements re: handling ofanonymous reports

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©2015 NAVEX Global, Inc.All Rights Reserved.

www.navexglobal.com© 2015 NAVEX Global, Inc.All Rights Reserved.

www.navexglobal.com© 2015 NAVEX Global, Inc.All Rights Reserved.

www.navexglobal.com

Source: NAVEX Global's 2015 Ethics and Compliance Hotline Benchmark Report

Anonymous report rates drop below 60% for the first time.

© 2015 NAVEX Global, Inc.All Rights Reserved.

www.navexglobal.com© 2015 NAVEX Global, Inc.All Rights Reserved.

www.navexglobal.com© 2015 NAVEX Global, Inc.All Rights Reserved.

www.navexglobal.com

Source: NAVEX Global's 2015 Ethics and Compliance Hotline Benchmark Report

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©2015 NAVEX Global, Inc.All Rights Reserved.

www.navexglobal.com© 2015 NAVEX Global, Inc.All Rights Reserved.

www.navexglobal.com© 2015 NAVEX Global, Inc.All Rights Reserved.

www.navexglobal.com

Source: NAVEX Global's 2015 Ethics and Compliance Hotline Benchmark Report

© 2015 NAVEX Global, Inc.All Rights Reserved.

www.navexglobal.com© 2015 NAVEX Global, Inc.All Rights Reserved.

www.navexglobal.com© 2015 NAVEX Global, Inc.All Rights Reserved.

www.navexglobal.com

2010 Benchmark 2011 Benchmark 2012 Benchmark 2013 Benchmark 2014 Benchmark

Repeat Reporters Repeat Reporters Repeat Reporters Repeat Reporters Repeat ReportersRepeat 24% Repeat 27% Repeat 27% Repeat 31% Repeat 32%

Substantiated Rate 2013 2014

First Time Reporters 35% 40%

Repeat Reporters 38% 42%

Caller Type

Accounting,Auditing &FinancialReporting

BusinessIntegrity

HR, Diversity &WorkplaceRespect

Environment,Health& Safety

Misuse,Misappropriation

of CorporateAssets

First TimeReporter 2014

1% 13% 76% 7% 3%

Repeat Reporter2014

3% 10% 81% 4% 3%

Source: NAVEX Global's 2015 Ethics and Compliance Hotline Benchmark Report

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©2015 NAVEX Global, Inc.All Rights Reserved.

www.navexglobal.com© 2015 NAVEX Global, Inc.All Rights Reserved.

www.navexglobal.com© 2015 NAVEX Global, Inc.All Rights Reserved.

www.navexglobal.com

Source: NAVEX Global's 2015 Ethics and Compliance Hotline Benchmark Report

© 2015 NAVEX Global, Inc.All Rights Reserved.

www.navexglobal.com© 2015 NAVEX Global, Inc.All Rights Reserved.

www.navexglobal.com© 2015 NAVEX Global, Inc.All Rights Reserved.

www.navexglobal.com

Source: NAVEX Global's 2015 Ethics and Compliance Hotline Benchmark Report

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©2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

N AV E X G l o b a l R o u n d t a b l e

© 2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

• Training and communication initiatives

• Published (or rumors of) internal cases and disciplinary actions

• Internal restructuring/management changes/layoffs

• Policy changes: Code or HR

• Mergers, acquisitions, changes in lines of business

• Regulatory changes

• News articles re: industry, competitors, or the latest compliancescandal

• A real problem

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©2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

1. Discouraging callers with questions or requests for advice

2. Investigations missteps:Investigations that take too long

Poorly trained investigators

Maintaining objectivity and professionalism

Not vigorously protecting confidentiality

3. Not publishing sanitised outcomes to employees

4. Not looking for trends and related variables

5. Call data to Board and senior management without context

©2014 NAVEX GLOBAL ALL RIGHTS RESERVED.

© 2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.

• Use a robust case management system

• Run your data different ways

• Research anomalies

• Drill down to locations and businesses, issue types and topics,anonymous calls, substantiated allegations

• Sometimes you “don’t know it until you see it”

• Follow your gut instincts on brewing problems

• Track and report on quality of case management and investigations

• Track disciplinary actions by offense, level of employee, or group…

©2014 NAVEX GLOBAL ALL RIGHTS RESERVED.

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©2014 NAVEX Global, Inc. www.navexglobal.comAll Rights Reserved.