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The Cherry on Top: The Compliance Culture

An Interview with Andras Levai, Head of Legal - CE Ethics and Compliance at Tesco Central Europe

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Andras Levai is the Head of Legal-CE Ethics and Compliance at Tesco Central Europe. Levai, who is based in Hungary, has been with Tesco since June 2009, when he joined as Senior Legal Counsel. In 2013, he was appointed to the role of Group Internal Auditor for Hungary and Turkey and he became the Head of Legal for Hungary in 2014. He was appointed to his current role in 2016. Prior to Tesco, he worked at the Hidasi & Partners Law Firm.

CEELM:  To define the goal, what is a compliance culture in your mind?

ANDRAS: To give you a feel of my role, I am now handling the ethics and compliance agenda for the Central European region (Hungary, Czech Republic, Slovakia and Poland). Bribery, competition law, data privacy and all kinds of compliance governance land on my rather broad agenda. In this capacity, I like making the analogy that compliance and a compliance culture are like a cake and the cherry on top of it. 

The cake represents the basics in terms of compliance. By “basics” I mean all the trainings, the guidelines, the communications, etc. I like doing compliance, but sometimes it can seem a bit of a dry area. 

In contrast, the cherry is the culture of it all. It’s the one thing you can start focusing on once you have the basics in place, and you have done them right – otherwise you wouldn’t be able to develop a culture. What is culture? It’s the next step. It’s asking how you achieve a company where people are not “forced” to engage in compliance and resent it when it comes up – either because it’s perceived as boring or because it’s a tedious exercise. It’s about how do you get people to complete an online training because they perceive it as something important for them, to protect themselves and the business. After two or three years of building the basics, we have now started focusing on the culture side of things, and we’re already seeing results. And, really, as a compliance function leader that’s when you start being happy in your role – when you start noticing genuine engagement from the rest of the company towards compliance. 

CEELM:  Since you mentioned you now have your cake and are finally ready to start working on the cherry, what’s the first step towards it?

ANDRAS: We just started a workshop with our managers and directors on our code of business conduct. We already had an online training that takes place each year. However, this year we started with a workshop for smaller groups of our senior colleagues. This is not just about the specific provisions and the content of the code of conduct. The critical component focuses on the bigger picture of “how” someone should act with integrity as a responsible leader within Tesco. 

Before we started it, we just hoped that this be well-received from our colleagues, who had said they didn’t think they could participate in an exciting and genuinely interactive workshop on compliance and ethics. That was really good for us to hear, of course, as we worked hard to develop an agenda that moved away from a technical lecture into an interactive discussion. 

CEELM:  And what are the elements you use to make it interactive?

ANDRAS: Prior to the workshop, we ask colleagues to prepare by reflecting on and sending us a leader that they admire. As an ice-breaker, we use their responses to explain why they admire that leader and why they believe he or she acts with high integrity. This is a good starter and the desired outcome of it is to “define” what integrity means for people. It is very interesting to see how in different workshops, run in different countries, for different functions, the outcome is very similar. There are very interesting discussions that stem from the results as well as the similarity between the results across the different workshops. 

In the second half we put ethical dilemmas up for debate and open up the floor to all. The questions raised tend to be related to our own company rather than commonly-discussed ethical dilemmas. We look to debate questions around the lines of “should companies do more or not than what is required by the letter of the law,” or others derived directly from our own operations.

CEELM: Why did you pick this format and target audience?

ANDRAS: It was actually based on an internal survey we carried out a while ago. Every year our colleagues need to make a declaration at the end of year financial year that they have respected the company’s code of conduct – this is mainly a process resulting from UK Bribery Act compliance efforts. Along with this exercise, we launched a quick survey to our colleagues to find out what it is that “encourages them to follow an ethical culture” within their role. The results in CEE indicated that, more than in other jurisdictions, line managers were highly respected and perceived as role models. It only made sense then that we focused some of our efforts towards training them as compliance culture ambassadors. This was the critical point that led us to start these workshops. 

CEELM: What other activities did you find help you build that compliance culture?

ANDRAS: I’d describe them all generally as activities that are not the ordinary way to communicate with colleagues. For example, for our competition function, we carry out an “extraordinary” event for our buyers. This is a half day event where one part is a theoretical – one where we present competition law – and one is a part focused on a discussion around this area followed by a light quiz on the topic with a few prizes at stake to get people engaged. This is, again, something that can bring competition and compliance closer to people and make it a bit more interesting – especially since this is intentionally organized outside of the office. 

Each year we also run what we call a “colleague event.” There we, the compliance team, regularly have an exhibition zone. It was weird for us to have a booth the first time we set it up, but over time we developed a quiz game that participants can get involved in, and, again, win some prizes. In my mind, these are not core elements but small things to bring compliance closer to the hearts and minds of our colleagues. 

CEELM:  How large is your compliance team and how is it structured?

ANDRAS: It consists of nine people, covering three areas: Business Integrity (bribery, trainings, communications, and governance); Competition Law; and Privacy. I have people in all four CEE countries and we work in a structure similar to big law firms, in that we have practice groups – we don’t work country by country but practice area by practice area. My Data Protection Officer is in Krakow, my competition legal counsel is in Budapest and so on. 

CEELM:  Since you mentioned privacy, how much of an impact has data protection had on your work over these past few years?

ANDRAS: A significant one. The largest team in my group is the privacy group now. We have a rather robust program in place – in line with the UK program. It gave us a lot of work over the last couple of years and I am sure it will continue to do so. Even though the GDPR is becoming less and less newsworthy, it still was a huge change for an organization the size of ours, where you have thousands of systems and processes in place, making it a considerable challenge to keep it all under control. 

CEELM: Any future developments you see on the horizon that will have a similar impact?

ANDRAS: Nothing really at the scale of the GDPR. We spent the last three years with the launching of the different compliance programs I mentioned already. I think that now we are in a position where we can say we have the cake, so now – while I cannot know for sure what the future holds – I really hope we can focus on the cherry part and develop the existing programs.

This Article was originally published in Issue 6.3 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.