Q&A: Nancy Higgins, Chief Compliance

Officer, Bechtel
TUESDAY, APRIL 30, 2013 2013 Dow Jones & Company, Inc. All Rights Reserved.
By Ben DiPietro
Nancy Higgins, since 2007
the chief ethics and compli-
ance officer for engineering,
const ruct i on and proj ect
management firm Bechtel,
says the company places a
high priority on ethical busi-
ness conduct and backs it up
with a program of extensive
training and a culture of high
expectations. She spoke to Risk
& Compliance Journal about
her job and the importance of
making sure employees know
the rules in the dozens of coun-
tries where Bechtel does busi-
ness.
What are your main ethics
and compliance challenges?
Higgins: One of my chal-
lenges coming in was that
everyone at Bechtel understood
and was expected to do the
right thing and act ethically,
so it was important to point
out that you cant just rely on
common sense when dealing
with a really complex series
of laws and regulations from
around the world. We needed
to make a concerted effort to
make sure that our employees
not onl y understood their
expectations for ethical busi-
ness conduct but were trained
in the laws and regulations that
applied to their jobs so they
wouldnt inadvertently violate
the law.
We have 52,000 employees,
and about 22,000 of those are
non-manual employees. We
currently have 270 projects in
40 countries. Over the history
of the company we have had
22,000 projects in 140 countries,
so its really important that we
get our message out quickly
and in ways our global work-
force can understand.
How do you get that message
across?
Higgins: All of our non-
manual employees are required
to take an online course in
our code of conduct within
two weeks after coming to
Bechtel. It is available in
multiple languages, as is the
code of conduct. Within 60
days of employment they are
required to take a number of
basic awareness courses in the
compliance and risk areas that
apply to their jobs.
Is the Foreign Corrupt Prac-
tices Act a huge area of concern
for you?
Hi ggi ns: We t rai n our
empl oyees i n anti - corrup-
tion and not just the FCPA.
We explain that, as a U.S.
company, our employees are
obligated to comply with U.S.
laws wherever we are, but we
also want to comply with local
laws. Our rules are so strict if
our people follow our code of
conduct without ever hearing
about the anti-corruption laws,
we would be in compliance with
all of them. But we still train so
our people can recognize issues
that might come up.
We also are involved in
international, multi-industry
anti-corruption efforts like the
Partnering Against Corrup-
tion Initiative of the World
Economic Forum. The signa-
tories to PACI all agree to
have programs that prohibit
corruption and are desig-
nated to improve the anti-
corruption situation around the
world. Last month in India we
released the PACI good-prac-
tice guidelines on conducting
third-party due diligence. Its
an excellent product that takes
into consideration FCPA, the
U.K. Bribery Act, the Minister
of Justice guidelines, recent
U.S. Department of Justice
guidelines, Transparency Inter-
national guidance and Organi-
zation for Economic Co-oper-
ation and Development guid-
ance and turns it into practical
things companies can use to
make sure theyre aware of
risk and putting in place appro-
priate systems to detect and
deter corruption.
How do you resolve the
conflict between U.S. laws and
local laws?
Higgins: We run into that
from time to time. We say we
comply with laws wherever we
are unless they are in conflict
with U.S. laws. We cant violate
U.S. laws.
How do you manage relation-
ships with third-party vendors?
Higgins: One of the things
that makes Bechtel successful
is our ability to go into a
country and hire local people
and train them to our stan-
dards and assure we are
proceeding in an ethical and
safe manner, even if local
laws do not require our level
of diligence. Before we do busi-
ness with any company we
do due diligence to the extent
that we checked the restricted
party list to see if any of our
vendors have been named on
that list or, if theyre politi-
cally connected parties, we look
and see if there are any red
flags. If so, we do additional
due diligence or we simply
cant work with that company.
We were doing that before all
the emphasis on the need to
look at third-party partners and
vendors and subcontractors.
Awareness of that really rose
in response to the U.K. Bribery
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(over please)
Bechtel
Nancy Higgins, chief ethics and compliance officer, Bechtel.
Act, so we welcome that kind of
scrutiny.
Beyond bribery, where else
does the company focus its compli-
ance efforts?
Hi ggi ns: The i mportance
of our ethics and compliance
program is the focus on behavior
as well as the legal require-
ments. Oftentimes our ethics
programs get approached by
employees with concerns that
have no legal impact and theres
no legal exposure for company,
but its behavior theyre seeing
that they believe doesnt comport
with our company. We take that
with the same importance as
an export control violation or
anything in the legal risk area.
Our ability to detect violations
and continually improve our
program is based on employee
confidence that they can come to
ethics and compliance and raise
concerns, even confidentially or
anonymously. We take it all seri-
ously and investigate appropri-
ately, and when substantiated
we will take appropriate action.
It creates a kind of culture of
people who will call you if they
think something is wrong, even
if they fear retaliation, because
they are loyal and want to speak
and know we will deal with it
appropriately.
How do you facilitate this
communication?
Higgins: We have an ethics
helpline employees can access
via email . We al so have a
Web l i ne where empl oyees
can contact ethics through the
Internet. We just switched over
to a new system where instead
of having a helpline answered
in-house it is answered by an
external provider and avail-
able on a 24-7 basis around
the world. We constantly are
looking at ways to improve our
ease of communication with
ethics. Weve appointed ethics
officers in all of our operating
organizations and our func-
tions and services, and we have
ethics contacts on many of our
projects. We require an ethics
officer to be designated to all of
our projects in high-risk areas
around the world.
Who do you report to within the
corporate structure?
Higgins: Administratively
I report to the general counsel,
but also to the audit committee
of the board of directors. I
make a report at every audit
committee meeting on issues
that are ongoing. We also have
established a corporate compli-
ance council where we bring
together subject-matter experts
and seni or managersand
address our policies of whether
they need to be updated based
on changes in risk or changes in
law. We have a separate group of
senior management called the
Quality and Compliance Working
Groupthat provides overall
oversight of the ethics and
compliance program and guid-
ance and executive sponsorship
for our initiatives.