Flying a plane is an incredibly complex job that requires tremendous amounts of training. Yet, when a pilot is suddenly unavailable, the airline usually locates another pilot who is equally qualified to fly the plane, and the flight goes off with nothing more than a minor delay.
Is it possible for the same type of seamless transition when the chief compliance officer retires or quits? Or if any key member of our compliance team leaves?
Unfortunately, the answer is far too often “no.” And the reason is that a compliance program is different than a machine, even a very complicated one, that someone can be trained to operate. The pilot doesn’t have to talk to and persuade the plane to fly properly; it responds to the controls and switches that the pilot operates.
But in compliance, success is based heavily on relationships, communication, negotiation, and persuasion. Plugging a new person into a relationship gets complicated. Learning the technical aspects of a compliance program (e.g., risk assessment, training, monitoring and auditing plans) is easy by comparison. Building the relationships that are crucial to the success of a program is more time-consuming.
In small organizations, succession planning will inherently be more challenging than in larger ones. But, whenever possible, establishing relationships with multiple members of the compliance team, especially if there is an identified successor to a particular position, helps to ensure a smoother transition when someone leaves the team.
In May, Katherine Eilers and Tammy Jelinek, from accounting and consulting firm Wipfli, discussed succession as part of SCCE & HCCA’s Nonprofit Sector Compliance Conference. Importantly, Eilers and Jelinek distinguished proactive succession planning from reactive replacement planning.
The best compliance programs are those that would continue to function effectively in the event of a sudden departure, even if that departure is the chief compliance officer. The best leaders are those who position themselves as valued and desirable, but not absolutely critical to the continued operation of the program. You want your organization to strongly prefer that you stay, but you don’t want the organization to feel that the program would fail if you left. It takes a strong and secure leader to do this, but that’s an important first step to succession planning.
Next month I’ll discuss another important aspect of succession and compliance.
1 Katherine Eilers and Tammy Jelinek, “People and Compliance: Challenges in Nonprofit Organizations,” Nonprofit Sector Compliance Conference, May 24, 2022, https://compliancecosmos.org/people-and-compliance-challenges-nonprofit-organizations-0.