Corporations and nonprofits are in mutual company in 2020 as new rules and regulations of corporation oversight and employment go into effect. Leadership will have to step up their administrative supervision of their internal processes to ensure they don’t violate new legislature. Luckily, hiring a private investigator to ensure your company is compliant with new administrative legislature at the fraction of a cost to expand your corporation’s internal investigation team.
Legislature and leadership alike are refocusing their personnel priorities to push sexual harassment to the forefront of their reform. In addition to ratcheting up sexual harassment prevention, but all forms of harassment within their workplace. A recent NLRB decision that would allow leadership to enforce total confidentiality during internal investigation, which will assist the identification of predators within any workforce. Private investigators are ideal candidates to seek out the predator in any corporation or organization, because they can infiltrate the workforce under the radar and collect evidence and testimony that might otherwise be lost.
Employers can look forward to the United States Immigration and Customs
Enforcement (ICE) increasing oversight on work sites, evaluating hiring
processes, and ensuring every employee is able to legally work in the United
States. Employers who do not comply will be subject to both civil and criminal
penalties that can be devastating to an organization. Private investigators
have vast databases at their disposal to obtain work and residency records for
potential hire, applying proven screening methods to ensure no personnel are a
legal liability.
Independent Contractors
Legislature is also holding companies to a higher standard of responsibility when their independent or sub-contractors incur legal trouble or have grievances against the parent organization. A bill in California known as AB 5 would make it more difficult to classify a worker as an independent or sub-contractor, a measure that would effect employers both in California and throughout the nation. When contractors are successfully classified as such, you’ll need a private investigator on your side to comprehensively vet the situation. With their full investigative toolbox, private investigators can get to the truth about inciting events that led to legal action, collecting evidence, speaking to worksite foremen, and provide comprehensive solutions to employers.
Overtime
Private investigators can also lend their prowess to individuals who
believe a corporation is misappropriating funds in order to comply with a
Department of Labor measure that requires employers to pay a minimum percentage
of total salary in order to satisfy overtime requirements. Private
investigators who specialize in financial fraud and misappropriation are able
to review a corporation’s internal processes and open-source financial records
to document the appropriation of overtime pay.
With
the ubiquity of technology and digital communication systems, corporate data—especially
with regard to transparency—is a trending issue in public discourse. Whether
through legal channels or otherwise, corporations and organizations need to
protect their data from falling into the wrong hands. A private investigator
can provide any organization with a risk assessment of both their digital and
brick-and-mortar security measures from top to bottom—identifying cracks in the
system and providing expert recommendations to ensure internal information
stays internal. Private investigators can also identify potential
whistleblowers in a workforce by examining individual risk factors and patterns
of behavior.
John Stumpf has been slapped with the largest fine ever levied against a single individual in litigative history.
The Office of the Comptroller of the Currency, a division of
the Treasury Department in the United States, has finally stuck a blow against
one of the most reckless financial institutions in the nation, Wells Fargo. This
federal department has linked a former chief executive of Wells Fargo with compulsion
on the part of leadership to encourage Wells Fargo employees to set up
fraudulent accounts that would hold extracted fees from customers.
John Stumpf, the former executive in question, has been
slapped with a monumental fine totaling approximately $17.5 million. The extent
of the misconduct was so severe, that the OCC also banned Stumpf from the
banking industry for the rest of his life. He was not alone—a former head of
banking at Wells Fargo, Carrie Tolstedt is also facing a fine of $25 million.
The Office of the Comptroller of Currency has also issued a
notice which argues that Wells Fargo has engaged in toxic business practices
over the last ten years, compelling employees to exhibit “serious misconduct”
in order to meet “intentionally unreasonable sales goals.” The notice went on
to say that the corporation operated within an environment of malignant
leadership, indicated by “…an atmosphere that perpetuated improper illegal conduct.”
Wells Fargo’s head of corporate investigations testified
before the Office of the Comptroller of Currency, informing them that there was
hypervigilance on part of leadership with regards to sales quotas, but
lethargic oversight with regards to illegal sales practices. It was apparent to
the corporate investigator that leadership was indifferent to how
employees met sales quotas, as long as those quotas were consistently met.
Lower-level employees were made accomplices—single cogs in a large clockwork
corporate fraud.
As the saying goes, “the fish stinks from the head,” and the litigative implications of these proceedings have indicated Wells Fargo reeks of poor corporate culture. Regardless of whether or not it is healthy, corporate culture moves in a cycle, with cause-and-effect factors that can often be traced back to leadership. Not only should leadership be an example for the entire corporation, but their interpersonal conduct within the workplace directly effects their employees’ engagement and productivity. Executives who impose unreasonable or unattainable goals on their employees are setting them up for failure, absolving themselves from responsibility when goals are not met. This leads to a toxic, high-pressure work environment where employees don’t just feel unsupported, but also devalued in the eyes of their employer. Employee engagement goes down, and consequently, so does productivity. This frustrates leadership, which then reacts by tightening their grip, beginning the cycle anew. If your corporation experiences persistent problems with leadership misconduct, it’s definitely time for a corporate culture audit. Corporate culture audits are like checkups for your business. Independent investigators come into your business and evaluate all operations—communication, record-keeping, hiring processes, and employee engagement. They identify the cause of these malignant symptoms and provide the corporation with expert recommendations that will ultimately propel their organization forward. If your corporation needs a corporate culture audit, call Lauth Investigations International today at 317-951-1100 to get a free quote, or contact us online at www.lauthinveststg.wpengine.com
The National Law Relations Board reverses controversial position on internal investigations.
Employers across the country have operated in a sea of gray area when it comes to confidentiality among employees regarding internal investigations. The question remained whether or not employers were able to require employees to keep internal investigations internal while they were in full swing. Prior to the new year, the National Labor Relations Board (NLRB) finally answered that question.
Previously, the National Labor Relations Board (NLRB) had
taken a position that employers could not require employees to keep ongoing
internal investigations confidential because it generally violated labor law. Section
7 of the National Labor Relations Act guarantees employees “the right to
self-organization, to form, join, or assist labor organizations, to bargain
collectively through representatives of their own choosing.” Universal
requirement of confidentiality could potentially interfere with that law.
Confidentiality in internal investigations was instead dealt with on a
case-by-case basis, with no precedent for blanket confidentiality. This topic
has been in review by the NLRB since May of 2019, but it was only recently that
the board announced that they had reversed their position.
By their very nature, internal investigations are already a big headache for many employers. Further compounding these frustrations is the ideation that no internal investigation can generate meaningful results unless the integrity of the internal investigation is maintained by all employees of the corporation or organization. This new standard of approval by the National Labor Relations Board is a categorical win for employers. The win comes down to one word—duration. In articulating their decision, the majority wrote,
“There are obvious mutual interests to be served by encouraging and allowing employees to report wrongdoing without fear of reprisal from the subject of the investigation. Among other considerations, such reporting promotes the goals of the antidiscrimination statutes by helping employers eradicate workplace discrimination and deal with it promptly and effectively when it occurs.”
This articulation is indirectly evocative of the cycle of
corporate culture, a process by which cause and effect on the parts of both
leadership and employees in pursuit of improved operations leads to a healthy
corporate culture for the entire workforce.
While there are concerns that the future of this reversal
may affect an employee’s ability to organize, the projection of this reversal
is very good news for internal investigations. In any investigation, the
control of information is critical to finding solutions to the corporate
crisis, allowing investigators to use tried-and-true methodology to get to the
root of the problem. With the NLRB finally taking a position that allows
employers to require confidentiality, the integrity of those internal
investigations can now be maintained from the onset, leading to clearer
solutions for the pervasive issues that malign corporations and organizations.
Corporations that have seen a decline in their corporate culture are turning to internal investigation and risk assessment firms for help in 2020. The discourse around corporate culture has evolved significantly over the last few years, with employees voicing their desire for work-life balance and how corporate culture directly impacts their decision to stay with a company. Leadership is better-educating themselves on how their actions feed into the cycle of corporate culture, and how they can improve employee retention by making meaningful changes that grease the wheels of success in their business or organization. However, many corporations have their anxieties about conducting internal investigations in a fishbowl—where employees are able to see the methodology in motion—and how this will impact their workforce and their business.
Corporations can find themselves open to scrutiny from both
their employees and their customer-base when they announce an impending
internal investigation. Some corporations, for a myriad of reasons, opt to have
internal investigations under a cloak of classification in order to protect the
integrity of the investigation—however, in the interest of transparency, many
corporations opt for a visible investigation, warning employees, shareholders,
customers, or all of the above, of an impending internal investigation. This
means that the investigating bodies will be under a microscope of scrutiny
within the corporation, as their methodology, decorum, and their practices will
a source of debate around the proverbial watercooler.
Regardless of who is contracted to conduct the internal
investigation, or under what level of declassification, if there is visibility
of an investigation, there is a delicate balance of transparency and
professionalism needed in pursuit of the truth. One of the most difficult tasks
an internal investigator has at the inception of the investigation is
establishing a rapport with relevant parties, such as leadership and the
workforce in order to garner frankness from persons who will be crucial to the
fact-finding process.
Investigators must establish credibility with the client and
relevant subjects in the case. This means ensuring those individuals are aware
that the investigator shares their values and is only interested in identifying
problems to improve the business—not damage it—indicating a high level of
accountability that will have a ripple effect throughout the corporation or
organization.
In tandem with establishing credibility, investigators must
be straightforward about their objectives, outlining what the client hopes to
achieve and their proposed methods of reaching that goal. Investigators must
never make promises they cannot keep by making declarations before they know
the facts. Corporate investigators must always pursue a resolution to a
business’s problem that does not impair their long-term goals—by the same
token, it is imperative that the investigator informs the client that there
might be some negative consequences as the result of their findings, such as
turnover, further inquiries, or bad publicity.
Objectivity is key in any internal investigation. It’s one of the reasons some companies elect to have a private investigator or risk assessment firm conduct their investigation, as opposed to an in-house investigator or member of house counsel. No employee with a stake in the outcome of the investigation, even indirectly, may be 100% objective in identifying pervasive issues in an organization. In addition to that objectivity, an independent investigator—unknown to the corporation or organization—investigators can move through a workplace undetected. This will take the edge off of the “fishbowl” factor that is common with internal corporate investigations. Private investigators can adopt a persona and conduct their investigations without the eyes of concerned coworkers; interviewing employees, collecting evidence, evaluating the location, and reviewing internal communications can all be conducted in plain sight.
Internal corporate investigations with a “fishbowl” factor can be an inherent challenge for corporations. Above all, it’s important to remember that employees are your greatest asset, as they feed into a cycle of corporate culture that can successfully stimulate your business or organization. An appropriate level of trust and care must always be taken when subjecting your workforce to an internal investigation. When employees feel valued, they will become empowered and engaged to give their best to the benefit of your organization.
It’s mind-boggling to think that some of the most controversial scandals in our country’s history have taken place only in the last decade. Corporate scandal is a hot media item, with the misbehavior of employees at all levels facing public scrutiny. Information on corporations and their corporate culture is more visible than ever as experts continue to place more and more importance on work-life balance, and satisfaction in the workplace remaining the driving force behind employee engagement. As technology and the ubiquity of accessible information continues to advance, private United States citizens are becoming more informed about the largest corporations in the nation, how their behavior effects their corporate footprint, and how their own consumerism can affect these corporations.
BP Oil Spil
There’s no better place to start than at the beginning. In April of 2010, the oil and gas conglomerate BP began the new decade with an oil spill so catastrophic that we’re still talking about the environmental impact ten years later. The corporate scandal also involved devastating loss. The Deepwater Horizon rig exploded off the coast of the Gulf of Mexico, which broke open the will, dumping between 2.5 and 4.2 million barrels of oil into the gulf before it could be capped once more. For thousands of miles, the oil slicks contributed to the deterioration of marine life and had cost the corporation in excess of $65 billion dollars before 2020. In an article published in June of 2010, Peter Fairly of MIT Technology stated, “A culture of tighter safety and more experienced regulators might have prevented the BP Deepwater Horizon leak.” Under the terms of a settlement, BP agreed to pay the Natural Resource Damage Asessment Trustees up to $8.8 billion for restoration work to rebuild the natural environment that was damaged by the spill.
Foxconn Suicides
Later in 2010, there was an alarming string of suicides at a plant run by Foxconn, a Chinese corporation that produces roughly 40% of the world’s consumer electronic components—technology that builds our smartphones, gaming consoles, and other forms of smart technology. These tragedies were covered heavily in American media as questions arose to the quality of labor conditions in these Chinese plants. In subsequent investigations, it was revealed that workers could be working 12-hour shifts, with less than a dollar (U.S.) in their pocket for food. While the suicides received a great deal of coverage, and had public relations repercussions for corporations that utilize Foxconn exports, there have been at least 8 additional suicides at the same factor have been reported since 2010.
FIFA Corruption
Few things are more universally loved across the globe than soccer, or football, as it’s known in the rest of the world. In May of 2015, millions of soccer fans were shaken by the FIFA corruption corporate scandal. The Department of Justice indicted the Federation Internationale de Football Association leadership on charges of racketeering, wire fraud, and money-laundering. The indictment outlined various instances of an excess of $15 million dollars in bribes taken by executives for preserving advertisement marketing rights for decades. The scandal lead to the resignation of President Sepp Blatter in June of 2015 after he managed to escape indictment. Millions of dollars in legal costs and loss of corporate sponsorship severely damaged the reputation of the organization, netting losses of $122.4 million.
Theranos & Elizabeth Holmes
The scandal surrounding the health technology company known as Theranos was a cluster 15 years in the making. Once again a corporate scandal that effected public health, both the executive and the corporation were villified in the media. Stemming from a fear of needles when she was a child, founder Elizabeth Holmes was seeking to develop a technology that would lead to higher accessibility of blood-testing throughout the world. Her device supposedly would be able to perform a smattering of biological tests from a single drop of blood. The Wall Street Journal published an expose in October of 2015, exposing more of the company’s deception and further implicating some of Holmes’ colleagues in the scandal. Holmes was charged with massive fraud in March 2018. Formerly thought of as a young genius, she is scheduled to stand trial in 2020, facing up to 20 years in prison and millions of dollars in fines.
Big Pharma & the Opioid Crisis
Corporate scandal is at it’s worst when it comes to public health. The ever-growing opioid crisis in the United States is hands down one of the most pervasive scandals of the last decade. In 2017 alone, there were over 70,000 drug overdose deaths in the United States. Of those overdose deaths, 67% came from an overdose of opioids. From the Midwest to the Northeast, opioid deaths spiked between 2016 and 2017. As of November 2019, six pharmaceutical companies were under federal investigation and were facing federal charges for their responsibility for the opioid crisis. Amongst other big pharma companies, Purdue Pharma reached settled for billions of dollars for communities in 23 states that were affected by their shipment of opioids, forcing the company to ultimately filing for bankruptcy. The settlement set major precedent as the first of it’s kind in our American legal system.
Pervasive internal issues are the malignancies that
contribute to the decline of any corporation. While they come in many shapes
and iterations, issues like communication, employee engagement, and employee relations
can quickly derail a corporation’s mission. That’s why corporations across the
country are electing to undergo corporate
culture audits in order to get a full picture of what the internal issues
are so they can make concentrated efforts towards improving their business.
No two culture
audits will ever be the same—which is as it should be. Every company or
organization is fundamentally different from one other, not only due to its structure
and size, but because no workforce should be evaluated with the same measuring
stick as another. It’s imperative that the context of every single corporation
be fully explored. Full context can include, but is never limited to things
like corporate mission, vision, values, internal operations, structure, and
leadership.
Undergoing corporate culture audits is the first real step in addressing pervasive issues within the workplace. Think of it as an annual physical or checkup with a physician for your business. When you go to the doctor, you undergo an examination, and the specialists run tests in order to determine how healthy you are—a corporate culture audit is no different. A corporate culture auditor comes in and evaluates the level of functionality within your corporation so you can start implementing strategies to improve and grow your business. Here are some things that a corporate auditor might look at when they evaluate a corporation or organization:
Is everyone in the company invested in the same
things?
What are the valued differences between your
corporation and the competition?
What are the key measures of success within your
company?
What is the functionality of the leadership in
place versus the leadership required for success?
What are the environmental factors that are
contributing to the decline in culture?
What is the history of your company’s culture
from its foundation?
What are the subcultures that have formed in
your organization and what is their role within the company?
Corporate culture audits usually begin by speaking to
leadership. As the old adage goes, “The fish stinks from the head.” Many
problems within an organization can be traced back to problems with leadership,
and corporate culture auditors evaluate from the top down. Even if a CEO or
manager is engaged in supervision of daily operations, they may still be making
daily mistakes that contribute to stalls in the process.
Once leadership has been evaluated, auditors turn their
attention to internal operations. This involves looking at the chain of
command, the productivity flow (how the integral processes move from employee
to employee), and the quality of communication throughout the company. This
might involve interviewing department heads, reviewing meeting minutes, and
evaluating the environment of the workplace. This step is crucial, because regardless
of the leadership or employees in place, if the ecosystem of the workplace is
flawed, it can be difficult for even the most efficient, engaged employee to achieve
success.
Evaluating the environment and internal operations is
tantamount to establishing a bulletproof process for success—leaving the
workforce as one of the final pillars to be examined by the auditor. When you
seek a comprehensive picture of your employees’ level of engagement, it’s
important for auditors to identify the subcultures that are either contributing
or derailing your company’s mission and values. For example—there might be a
cluster of apathetic employees, who are not only disengaging together, but their
behavior actively encourages other employees to exhibit the same habits. This kind
of apathy can be a cancer in your corporation and may spread to other parts of
your workforce, further contributing to the decline of business.
Most importantly, at the conclusion of the audit, an
investigator will prepare a detailed report with very explicit recommendations
for how to fix the problems within the corporation or organization. This could
include items such as the termination of toxic employees, the revitalization of
internal operations, and necessary changes to a brick and mortar locations for
increased security or higher accountability. Once the audit is complete, the
burden of change lies with leadership to become beacons of change within the
internal structure. Corporate culture begins to improve when leadership
enforces changes from the top, allowing their example to trickle down through
the organization in the form of higher accountability and increased engagement.
If your corporation is suffering from a corporate crisis, don’t hesitate. Corporate culture audits are pulling more and more companies back into the black every day. Even if the crisis seems relatively minor, it could be symptomatic of a larger problem within your organization. Call Lauth Investigations International today for a free quote on our brand-new Corporate Culture Audit (CCA) program. Our dedicated and qualified staff composed of former military and law enforcement officers will get to the bottom of your internal problems. With Lauth Investigations International, you can expect hands-on, comprehensive services, detailed reports, and expert recommendations. When it comes to your business or organization, you should only expect facts, not fiction.
