Ethics Risk Assessment - Your Ethics Profile:

The Challenge

Every company believes that it operates ethically; that its employees know what is expected of them, and will “do the right thing”. Yet, year after year, many of those companies are proven wrong in ways that cost time, money, and reputation.

Best practices in maintaining high standards dictated by the Federal Sentencing Guidelines as well as the audit governing bodies emphasize the need to be alert to employees’ perceptions in the implementation and enforcement of an organization’s Code of Ethics and its internal controls.

The AICPA recently noted the extent to which management is perceived to be committed to conduct sanctioned by the code will influence the organization’s ability to deter, prevent, or detect management override of internal controls and violations of the code. Equally important, an evaluation by the audit committee of how effectively management communicates information about the code and motivates employees to comply with the code also provides key information about the culture.

The Solution

Metrus Group has developed the Ethics Risk Assessment™ (ERA), a web-based tool to examine employee attitudes and awareness of critical integrity and antifraud risks as part of a complete ethics program evaluation.

ERA™ measures employee perceptions and attitudes using 36 focused questions that provide clear guidance on how well the company is doing in meeting its compliance goals and where it needs to focus its training and communication efforts. The reports show how the overall organization and each demographic group (if selected) track on the six critical dimensions (described below).

Key Benefits

• Maximize limited training and communication dollars and resources by focusing attention on the areas that are generating the greatest risk
• Provides a baseline measurement for leadership to gauge progress in meeting ethics goals
• A critical antifraud diagnostic to measure an organization’s progress in creating an environment where employees feel secure enough to report potentially fraudulent activities.

Ethics Risk Assessment™ Categories

Each category deals with a key issue related to perception of ethics. The six Categories combine to create a complete picture of the ethical culture of the organization. Because of the way the analysis results are provided, users will be able to focus improvement resources on the concepts—and parts of the organization—with specifically defined needs.

Beliefs

Embedded cultural standards and norms of behavior

Questions addressing the participants’ attitudes regarding the company’s values and how they relate to day to day work. Even employees with strong personal values are less inclined to take action to “do the right thing” if that is not part of the culture of the company.

Communication

Unrestricted and fear free, downward, upward, and lateral communications

Questions address the participants’ perceptions of how well managers create an environment that encourages open discussion of issues as well as how well they respond to issues when they arise.

Leadership

Belief that leaders can always be trusted to do the right thing

Questions addressing the participants’ perceptions of how well managers set the right tone at the top and act consistent with the company’s values and policies.

Equity

Perceptions of justice, fairness, and consistency

Questions addressing the participants’ perceptions of how well the company treats all of its stakeholders, both internal and external.

Awareness

Education that goes beyond merely informing people of the rules

Questions addressing the participants’ perceptions of how well the participants understand what is expected of them and how ethical behavior relates to their job and the company’s business goals.

Rules and Regulations

Governance, formal systems and processes that support ethical conduct

Questions addressing the participants’ attitudes toward the rules and regulations and whether they are effective in guiding behavior.