Open Disclosure: Why and How to manage Conflict of Interest Disclosure

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Open  Disclosure:  Why  and  How  to  Manage  Conflict  of  Interest  Disclosures  

April 30, 2015

Chelsie Chmela Events Manager [email protected] 847.293.8806

We  encourage  you  to  engage  during  the  Q&A  porKon  of  today’s  webcast  by  using  the  chat  funcKon  located  within  your  viewing  experience.      

HOST

QUESTIONS

RECORDING The  event  recording  and  PowerPoint  presentaKon  will  be  provided  post  event.    

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SPEAKING TODAY    Philip  Winterburn  Chief  Product  Officer,  Convercent    

Marc  Leu  Global  Head  of  Ethics  and  Compliance  Risk  Management  &  Planning  ,  Philip  Morris  InternaKonal    

Charles  Pare  Manager,  Compliance  Risk  Management  &  Planning  ,  Philip  Morris  InternaKonal      

OPEN DISCLOSURE: WHY AND HOW TO MANAGE CONFLICT OF INTEREST DISCLOSURES LIVE WEBINAR | APRIL 30, 2015

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Introductions

Charles Pare Manager, Compliance Risk Management & Planning Philip Morris International

Philip Winterburn Chief Product Officer Convercent

Marc Leu Global Head of Ethics and Compliance Risk Management & Planning Philip Morris International

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Background

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What is a Conflict of Interest (COI)?

When an individual’s personal interests have the potential to interfere with their ability to act objectively in the best interests of the company.

Other Jobs Investments Personal Relationships

Direct and indirect relationships (influence and sharing)

The downside of COIs:

•  Hard to detect •  Tough for individuals to recognize/manage on their own •  Escalate in likelihood/severity at executive levels

The opportunity with properly managed COI disclosures:

•  Easier to disclose than misconduct •  Provide a first and ongoing interaction with compliance •  Allow gap analysis and early insight to risk •  Foster employee responsibility

é risk, ê employee trust and retention

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Impact of COI

ê risk, é employee trust and retention

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Managing the Process: The Traditional Ways

Annual certification, free-form narrative

Hotline reporting channel

The drawbacks: •  One and done •  Unstructured •  Intimidating •  Cumbersome •  Follow-up action and

communication impaired •  Impossible to analyze •  Volume and scale issues •  Difficult to ensure

consistency

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Managing the Process: The New Way

Compliance

Human Resources

Management

Disclosure(s) & Update(s)

Real-Time Dashboard & Historical Reporting

Clearance/Conditions

Clearance/Conditions Disclosures/Updates

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Managing the Process: The New Way Easy to comply, easy to manage, easy to report on

Employee perspective

Admin perspective

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Ensuring Success

•  Make it easy to comply •  Make it easy to manage •  Make it ongoing •  Focus on clearance and conditions •  Keep managers apprised •  Provide picklists •  Translate the intake •  Close the communication loop •  Mince words:

•  Disclose, not report •  Save, not submit •  Clear, not accept/reject •  Disclose and manage, not investigate and sanction

Give employees ownership à shape and change behavior à manage risk

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Measuring the Impact

•  Richer data and insight (by region, job, nature of conflict, conditions, etc.) •  Easier to act on •  Better benchmarking

•  Continuous dialogue between employees and compliance •  Drive participation and engagement •  Validate with survey results

•  Easier, more informed investigation process •  Less time spent on administrative tasks •  Improve organizational justice, transparency and employee retention

What’s the cost and impact of not knowing about and managing COIs?

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Q&A

Thank You.

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