Innovative Approaches to Compliance Training

"Compliance training is like an in-flight safety demonstration; it gives very important messages but often gets ignored!”

As our society is becoming more regulated, compliance and compliance training have become a part of our lives, not just for those in professional services but in all industries including the more obvious ones such as financial, medical and pharmaceutical and even manufacturing and retailing of consumer goods. There is no way to escape them.  

Many, hopefully not all, of us attend compliance training because it is compulsory in order to maintain our licences to practice or to keep our jobs. These are not really the right incentives at all for attending a training session, let alone following such compliance rules or policies. It is therefore necessary to find innovative approaches to encourage and establish a culture in learning and implementing compliance.  

This commentary is based on a panel discussion at the Deacons’ In-house Corporate Counsel Forum 2021 where expert panellists Erika Evasdottir, Managing Director of Centrium Advisory Services Limited, and Stanley Lui, Legal Director of Asia TI Fluid Systems shared their insights on ways to re-imagine compliance training as marketing and engagement tools.

Compliance as a marketing tool

According to Erika Evasdottir, the answer to the age-old question of “why you should care about compliance” is simply to avoid problems in the future. This “Fear Theory” is still the most common way to convey how costly the consequences of non-compliance can be, both personally and for the company.

A more interesting method to ensure compliance is to argue that compliance can and should be a useful marketing tool! By “marketing tool”, the theory is simply that sales and marketing personnel are more convincing when they can fluently and confidently explain industry risks and the company’s compliance response to prospective investors, clients and customers, thereby building trust. In this case, the company’s compliance programmes and policies become a way to demonstrate how experienced the company and its personnel are in the industry. As a result, companies whose staff members are able to describe its own approach rather than simply referring to “industry best practices” will stand out from the crowd.

Erika strongly believes in a two-way, interactive training approach. She helps her clients to develop their compliance handbooks by getting different departments involved, giving them ownership over their own compliance policies and procedures, and asking each department to teach other teams how to explain the risks and issues involved. By doing this, what normally would be a one-way passing on of knowledge by the compliance officer becomes a collective knowledge-building activity among the stakeholders.

Practical tips to facilitate this creation process include using infographics, organising materials in a consistent way, explaining the positive results from the changes and, most importantly, creating talking points aimed at existing and potential investors, clients and customers.

Training is not about a lecture, but rather showing each team how to use the rules or requirements to make their daily tasks easier. As people are often better at picking up others’ mistakes, inviting the audience to identify mistakes in a scenario and explain what should have been done would be a good exercise to show how the compliance rules affect different tasks.

Examples should also be tailored to the audience. The trick with examples, says Erika, is to ensure the takeaways capture the imagination – not just the old “and then our competitor was fined a LOT of money” or “then he went to jail!” but also the more interesting takeaways of “and that saved our company many millions” and “that is why this major customer/investor decided to go with us.” Stories like these help people to understand how compliance can be useful and to retain that information going forward.

Compliance training as an engagement tool

Stanley Lui agrees that activity-based training sessions are more effective and often uses role-playing and role-switching activities to increase the level of audience engagement.

“The worst thing is to just talk about the don’ts!” remarked Stanley. “This would only perpetuate the compliance department is a no-go land.”

Stanley is very creative in terms of using different props to inject ideas. He believes an engaging training session fosters maximum message stickiness. In one “sticky” session, he gave the participants a plain white tumbler and some illustrative stickers that visualise compliance concepts such as “conflict of interest” and “appropriate hospitality practices”. The audience would peel off a sticker whenever its corresponding compliance topic is being covered during the training, and affix it onto the tumbler that serves as a blank canvas. The session was an overall light and fun activity that generated sticky messages in the end.

Another creative session involved the handing out of cheer horns to promote the “Speak Up” initiative and not turning a blind eye to non-compliant behaviour. Such activity-based training seeks to engage front line colleagues with the ultimate objective of building trust within and amongst the teams.

Stanley is also the founder of the White Hats Guys, a sharing platform where legal and compliance trainers congregate. Its mission is to cultivate compliance culture and awareness via innovative training materials and engaging narratives. The “Think! So you won’t Sink” floatie concept was successfully shared through this platform.

As lawyers, we are used to reading lengthy documents but not every audience is receptive to the often rhetorical compliance rules. The idea is to reduce those complicated rules or policies into more palatable messages going along side with pictorial aids. If we can achieve that, we will soon find ourselves “putting the COOL in COOmpLiance”, as the White Hat Guys’ mission.

Effective compliance training should be about building trust

While there is no competency matrix or KPI that can be used to measure compliance training, its success is realised when the compliance department is busy answering calls from colleagues seeking assistance and guidance when or even before a red flag is raised. This requires a very high level of engagement and trust.

Ultimately, instead of a mundane routine of ticking the boxes, compliance training should be used to build trust within an organisation and capitalise the gate-keeping efforts of all staff members.

Co-head of Intellectual Property Department, Professional Standards & Development Partner, Deacons

Annie is the Co-head of Deacons’ Intellectual Property Department, and Partner in charge of Professional Standards & Development. She has over 25 years of experience in advising on all aspects of intellectual property work and on the unique challenges arising from doing business in Mainland China. Annie has advised many major Hong Kong and international clients on strategic issues relating to the protection, enforcement and commercial exploitation of intellectual property rights and she represents some of the world’s leading companies in the luxury goods, fashion, cosmetics, hotels, entertainment, food and restaurants, advanced technology, pharmaceutical, and electronics industries.

Annie has advised extensively on the IP aspects of acquisition and restructuring of businesses including technology transfer, licensing and cooperation issues, technology development and improvement.