What you'll learn on this podcast episode
As the regulatory environment continues to evolve and organizations adapt, it is becoming increasingly important for ethics and compliance professionals to break down department silos. But how do you do that effectively when there are so many stakeholders involved? How do you develop a stronger network of assurance partners inside your organization? On this episode of LRN’s Principled Podcast, host Dave Hansen talks about the impact of cross-functional collaboration on program effectiveness with Tony Tocco, the chief ethics and compliance officer and assistant corporate secretary of DT Midstream.
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Guest: Tony Tocco
Anthony M. Tocco (Tony) is the chief ethics and compliance officer and assistant corporate secretary at DT Midstream. He is responsible for overseeing the development and implementation of effective programs and processes to promote an ethical culture and compliance with applicable laws and regulations. He also provides board governance and support responsibilities as the assistant corporate secretary.
Tony joined DT Midstream as part of the business unit spin from DTE where he began as the manager of Audit Services in 2001 as a result of the merger with MCN Energy Group. In 2002, he was promoted to assistant general auditor and subsequently performed as interim general auditor for a period. During this time, Tony directed the development and implementation of the independent centralized testing center for Sarbanes-Oxley Act compliance and supporting corporate governance policies and procedures.
Prior to joining DTE Energy, Tony held leadership positions in the MCN Energy Internal Audit department and Michigan Consolidated Gas Company’s Corporate Security & Investigations department. In total, Tony has approximately 30 years of compliance related experience in the utility and energy industry. Tony also has four additional years of compliance experience working for the Department of Defense in reviewing and auditing defense contracts and also established the internal audit department for a major Michigan public university.
Tony earned a Bachelor of Science degree in accounting from Detroit College of Business, an MBA from Wayne State University, and a Master of Science degree in security administration from the University of Detroit-Mercy. Tony is a Certified Compliance and Ethics Professional (CCEP), a Certified Internal Auditor (CIA) and a Certified Fraud Examiner (CFE).
Tony is a member of the Ethics and Compliance Institute (ECI), the Society for Corporate Compliance and Ethics (SCCE), the Institute of Internal Auditors (IIA), the Association of Certified Fraud Examiners (ACFE) and the Society for Corporate Governance.
Tony also has lectured for the Institute of Internal Auditors, the Society for Corporate Compliance and Ethics, the Compliance and Ethics Officer Association, Compliance Week and the University of Detroit-Mercy. Tony is a former chairperson for the Ethics and Compliance Officer Association Utility Industry Group, which is comprised of approximately 70 utility companies. Tony serves on the CCEP Exam Writing Committee and is on the Board of Big Brothers Big Sisters of Metropolitan Detroit as development committee chair.
Dave Hansen is the global advocacy marketing director at LRN, an organization focused on ethics and compliance solutions that help people around the world do the right thing. His team drives LRN's customer obsession by building community, deepening customer engagement, and finding meaningful opportunities for collaboration. Dave is passionate about learning, having spent most of his career within higher education or training. He loves sharing customer stories and best practices in the name of continuous improvement. Dave is a proud dad, coffee enthusiast, drummer, and scuba diver. In his spare time, he enjoys cooking and reading!
Principled Podcast transcription
Intro: Welcome to the Principled Podcast, brought to you by LRN. The Principled Podcast brings together the collective wisdom on ethics, business and compliance, transformative stories of leadership and inspiring workplace culture. Listen in to discover valuable strategies from our community of business leaders and workplace change-makers.
Dave Hansen: As the regulatory environment continues to evolve and organizations adapt, it's becoming increasingly critical for ethics and compliance professionals to break down department silos. But how do you do that effectively when there's so many stakeholders involved? How do you develop a stronger network of assurance partners inside your organization?
Hello, and welcome to another episode of LRN's Principled Podcast. I'm your host, Dave Hansen, global advocacy marketing director at LRN. Today I'm joined by Tony Tocco, the chief ethics and compliance officer and assistant corporate secretary of DT Midstream. We're going to be talking about the impact of cross-functional collaboration on program effectiveness. Tony is a real expert in this space with over two decades of experience as a CECO and leader of internal audit functions. Tony, thanks for coming on the Principled Podcast.
Tony Tocco: Thanks, Dave, my pleasure. Thanks for the opportunity.
Dave Hansen: So let's dive right in. To start, for those who aren't familiar with DT Midstream, can you please share a quick snapshot about the organization and your role within it?
Tony Tocco: Yeah, sure. So DT Midstream is a natural gas pipeline and storage company, and we're headquartered in Detroit, Michigan. We also have several operations in other states throughout the country. So historically, we were a subsidiary of a major Michigan utility company that I had the fortunate opportunity to work for over the last 25 years in various leadership roles, including internal audit, corporate security, and the ethics and compliance office. And in 2001, we spun off from the utility and became our own independent public company. And I was fortunate to be chosen to help design a fit-for-purpose ethics and compliance program. So we're rather smaller than a utility company, but regardless of size, there's still critical elements of an ethics and compliance program as you're aware of that still need to be in place. So I had the opportunity to design a fit-for-purpose organization.
Dave Hansen: Wonderful. 25 years at that company too, is quite incredible. Before recording, you mentioned to me that you and your compliance team is in constant communication with other business units, HR, internal audits, enterprise risk management, IT. That level of collaboration, sadly not common across some other organizations. How do you make that work?
Tony Tocco: Yeah, good question. And I'll be lying if I didn't say it was somewhat of a challenge, but eventually, we got there, and it didn't happen within a year's time. But in my opinion, the number one skill for a CECO is really to have empathy. You have to really understand and build the trust of your employees, one, to make them comfortable coming to you, and then two, to understand the needs of your business partners. So having that philosophy in working with the various assurance companies, organizations within the company, that put us on a trajectory to really have a focus on being a collaborative business partner. So we approach the relationships with looking at the common goals and the business outcomes of what those goals are.
And in my philosophy on how to operate with the ethics and compliance office is that we're a business partner and a resource to others. So yes, we have oversight responsibilities. Yes, we are governance authority, and at times we have to be independent, but we are not the police. So we collaborate with and assist our business partners in developing the frameworks, the controls, and governance to support a culture of integrity, and then one that values the importance of compliance. And we do that by including them and bringing them into our processes or demonstrating ways that the tools that we have could really help them become more efficient.
So in the past, and you've probably heard the same things that I've heard, common challenges for other companies have been. We have difficult personalities that we have to work with. People are working in silos, creating their own territories, and then poor tone from the top. That's not a supportive team to help foster this collaboration. So it all goes back to your company values. For us, it's about respecting other people and inclusivity. So compliance really is now viewed as a partner rather than an individual entity in our organization.
Dave Hansen: There's a lot of great stuff that I want to reflect on with what you just said. I think that very first part about empathy is especially important. I think the world needs more empathy generally. So I love that you take that into consideration as you break down some of these silos. The other thing that I really appreciate about what you just said though is the bit about partnership, that you are a true business partner to work collaboratively. It's very interesting. So what are some examples of how you leveraged your partnerships to get other teams to meet your goals or expectations?
Tony Tocco: Yeah, so one area that I like to highlight was really the development of an integrated enterprise risk management program. So many of us have experienced from the work we do in our organizations, very siloed risk management processes. So internal audit may have their own risk assessment from a control perspective or a fraud perspective. Enterprise risk management may be looking at it from strategic, operational, or financial risks. Ethics and compliance typically look at it from a legal and regulatory risk. And what we found is that each one of these organizations were developing their own protocols, their own tools, and in some cases, purchasing different tools to fulfill that need. So once we've identified that, we thought there was an opportunity where we can bring the three of us together to work collaboratively where we have some standardization, use one consistent model and tool, and then present the results to our management and board in a very holistic way from a organization perspective versus them getting piece meals and having a very difficult to put that together.
So that's one example that we've recently tackled. Another example is the collaboration and support in developing our company governance documentation such as policies and our codes of conduct. So we design and provide the frameworks and protocols to ensure standardization and consistency among the various departments. So we support the process by facilitating the process for our business partners and document owners and not just having them do it on their own. So we have tools where we can reference policies that we could provide for them as a standard template for them to use and then tailor it to the needs of our company. So it turns out to be much more efficient.
And then one last example would be the development of a case management governance committee that includes representatives from our legal department, HR, and our internal audit and risk groups. So the purpose of this committee is really to evaluate the recommended case conclusion when we have investigations. And so I'll have an opportunity to ask questions, challenge, provide support or other ideas or recommendations, and then we have an agreement that no case gets closed unless their consensus from all those assurance groups to ensure that a thorough, consistent, and fair investigation was conducted. So those are just three examples of some of the work that we're doing from a very collaborative efforts with our assurance partners.
Dave Hansen: I like that part about reaching consensus on the cases. I think that adds a lot to, again, breaking down silos here. Something else that I really liked was your focus on integrating. Obviously, when you have different departments with different tools and different processes, it can get out of hand quickly. Seen that happen in organizations of the past. Bringing that all together obviously is a huge benefit. What are some of the other benefits that you've seen from this cross-functional collaboration?
Tony Tocco: Yeah, I would say efficiency for sure. I would say that's probably number one. So in the example that I provided from our risk management protocols, when we were in the different silos, we were typically hitting the same business partners three different times just because of the nature of the work and the accountability that they had. So each one of us would be interviewing them from a different perspective. So that was very efficient. It was also very confusing for them. It was, "Why am I talking to you, Tony, when I just talked to Joe?" that type of thing. So efficiency was number one. Also being inclusive in my opinion, provides greater results and effectiveness. So by bringing someone in our business partner from human resources or legal or internal audit, you get their perspective as well. So it's a very wide, broad stroke that we look at our processes from, not just simply from the ethics and compliance office.
Again, greater transparency, as you bring more people in to work together collaboratively, more people really understand the work that we do in the organization. So there's greater transparency, not only from what the ethics and compliance office does, but for example, my team gets an understanding of what the human resource group does, the legal group does, the internal audit, risk management, or any operating group as well. So cross-training and development and growth is another benefit from it that I see. It provides the opportunity for succession planning as we all become familiar with each other's business. For example, I came from the internal audit function and then was identified as a person that they had reached out to tap to open and establish our first ethics and compliance office just by the mere experience and exposure they had while I was working in the internal audit function. So I think it's a good development area as well.
Dave Hansen: That's very interesting. I couldn't help but think as you were talking too, that another benefit here is when you have three departments that are kind of working separately, there's probably also going to be a little bit of a language barrier that develops. You kind of come up with your own terms. So being able to bring that together might also help build that shared language as part of transparency and some of that other stuff. So I appreciate that response. I think something else that's worth mentioning is that you managed to do all of this at DT Midstream with a much smaller team than you had before. What are some steps you've taken to ensure that your ENC function is operating effectively without overwhelming all of your resources?
Tony Tocco: Yeah, so that's a good question. So as I mentioned earlier, we came from a much larger organization, but as an ethics and compliance office, you still have the same foundational elements of your program that you would at a large company, you just have to tailor it differently. So I made the decision not to recreate the wheel. So I brought several of our processes with us and then tailored them to what I call a fit-for-purpose state, meaning that we modified them to fit the needs of our company. So we streamlined it to the nature of our organization. And because we didn't have so many business units and things of that nature, so we looked at ways where we could streamline the processes. So I have a relatively new team to the organization. So what I like to do is introduce them to our business partners because I think it gives them a good business knowledge and experience, and it empowers them to design and develop their work with input from our partners and an understanding of their perspective.
So if we have an initiative in my office, what I do with my team is I encourage them to collaborate with one of our business partners, get their sense of what their needs are, and as a user of some of the tools that my office deploys to the organization, get their feeling, their understanding, what are they looking for that could make it better. So I encourage my team to work directly with our stakeholders, and I also encourage them to look for opportunities to collaborate on other various initiatives. For example, we're currently collaborating on a manager toolkit with our HR partners. So rather than having multiple toolkits, so HR has one toolkit with other HR resources for leaders and employees, why not just have one where, you can segregate the HR ones, the ethics, and compliance one so our leaders only have to go to one place to look for the information that they need.
Dave Hansen: That's a fantastic initiative. It seems like something that's really practical and accessible too. So maybe that's a future episode of the podcast we can dive into those toolkits more. Last question for me for today is what advice would you give to other ENC leaders who are struggling with collaboration challenges or maybe they just have smaller teams?
Tony Tocco: Yeah, so as I mentioned before, have empathy. Really try to understand the needs of your employees and your business partners. Also make efficiency a value, or we call them a service key in our organization. So it's one of our key initiatives. We look at everything we do from an efficiency perspective. Search for ways to integrate work into existing processes or initiatives rather than creating your own. So that's something... When we identified the HR group was working on a toolkit, we went to them and said, "Hey, we were thinking of the same thing. Would you like to collaborate?" And so that's what I mean about look for other things that already exist in your organization that you can just build upon rather than recreating.
And then be a resource and support channel to your employees, but also to your stakeholders. As you can continue through this collaboration and working together in partnership, you're going to find out that more and more people are going to be coming to you to ask questions or to get you involved in some of their initiatives as well. So it's kind of a win-win situation. So as you look at it from an ethics and compliance perspective, you can alway... As you get involved in these initiatives and are being asked to participate, that's a perfect opportunity to look at it from a legal and regulatory risk perspective as well that typically you would not have exposure to if you weren't asked. So my suggestions.
Dave Hansen: They're great suggestions. Knocking down those walls, breaking down those barriers, whatever you prefer to use there, it takes work. So I especially like that tip about searching for ways to integrate. It's absolutely fantastic. It looks like we're already out of time for today. Tony, it's been absolutely so great having you on this podcast. I hope you'll come back and speak with us again very soon. To everyone else, once again, my name is Dave Hansen. I want to thank you all for tuning into the Principled Podcast by LRN.
Tony Tocco: Thanks, Dave.
Outro: We hope you enjoyed this episode. The Principled podcast is brought to you by LRN. At LRN, our mission is to inspire principled performance and global organizations by helping them foster winning ethical cultures rooted in sustainable values. Please visit us at lrn.com to learn more. And if you enjoyed this episode, subscribe to our podcast on Apple Podcasts, Stitcher, Google Podcasts, or wherever you listen. And don't forget to leave us a review.
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