Though many firms today have legal counsels to ensure designers are acting within the letter of the law, blind spots regarding varying ethical standards can still land an architect in hot water. Below, business experts and design leaders discuss the benefits of establishing a compliance program.
Risks and Regulations
When a designer from international firm CannonDesign became embroiled in a legal conflict related to a federal contracting project in 2012, it became evident that, to protect and educate their staff and brand, the firm should create a compliance division. Tasked with establishing ethical standards and oversight of the company’s extensive portfolio, former FBI agent Paul Moskal joined as CannonDesign’s compliance director in 2014. “We didn’t provide adequate training to our employees to identify issues that may be problematic for them,” Moskal says of the time prior to the program’s adoption.
To determine “what factors put the firm or its employees, clients, or partners at risk,” Moskal first completed a risk analysis. While all of your firm’s risk exposure will vary based on the locations of your projects, local ordinances, and myriad other factors, identifying the key risks enables a compliance officer to create a personalized plan for the firm, and a roadmap for employees to follow. “There are [federal rules], there are state rules, there are local rules, there are rules for the private clients, there are different rules that apply internationally,” Moskal says. “It’s very difficult for a good architect, a good engineer, a good designer to do his or her work and be familiar with all of those rules.”
Establishing a Code of Conduct
One of the best ways to avoid potential pitfalls and to establish company-wide protocols for legal and ethical standards is to create a code of conduct. This can detail everything from gift giving and receiving, to privacy and confidentiality, to conflicts of interest. While Louisville, Ky., firm Luckett & Farley has yet to make the leap to creating a full compliance program, it is currently developing a code to protect both its clients and its employee owners. (Luckett & Farley is an employee stock ownership plan firm. Firms with an ESOP model like this divide ownership into shares to distribute to employees.) “We’re a transparent company and so we try to keep our employee owners informed,” says president and CEO Aric Andrew, AIA of the forthcoming code of conduct. “We can’t expect them to understand all the issues with ethics and compliance, so the first step is to get the information in front of them and then [once] they understand what the issues are, [they can] hold each other accountable.” And while creating a code can help to reinforce company values, it will also make the work easier. “Any additional education in the area is going to help [our employees] do their job that much better,” Andrew says.
For CannonDesign, their code of conduct has not only clarified the firm’s cultural, moral, and ethical expectations, but has also helped them earn and select work. “By inculcating the compliance program, honesty, and integrity into all of our business decisions, we actually bring value to our partners [and] clients,” Moskal says. “And we’ve been solicited by clients to work for them, as a consequence.”
Matthew Dates, senior structural engineer and vice president in CannonDesign’s Buffalo, N.Y., office, agrees. “Our compliance training has just given our people a new sense of awareness when it comes to client engagement and pursuing work,” he says. “It’s this other mental check you need to consider when looking at project pursuits.”
Potential Consequences
The range of penalties for failing to following compliance protocols—be it local, federal, or international—is almost as vast as the number regulations that a firm must observe. In extreme cases, a firm could be suspended or disbarred from pursuing federal work, or if an employee is deemed personally liable, it could mean jail time. “If you have information that is confidential, or not shared with the other teams pursuing that work, it can put you and your firm at risk, long-term,” Dates says. “You want to be sure everyone pursuing a new project is on the same level playing field. It’s the right thing to do.”
The most common consequence today is for a company to lose face due to an oversight—no matter the intention. With the 24/7 news cycle and the proliferation of social media, “even well-intentioned mistakes can now end up as a headline in tomorrow’s newspaper,” Moskal says. Because of this, it falls to Moskal and eventually Luckett & Farley’s vice president of talent and organization development Susan Pittman to ensure employees receive the appropriate training and guidance to avoid possibly career-altering consequences.
“[In the legal world] ignorance isn’t a defense to the law,” Moskal says, and “well, it’s the same in the AE world—not knowing the rules doesn’t excuse your actions.”
