Never-ending ethics

At CMS Energy, there is a continuous effort to improve the company’s compliance programs. The CMS Energy code of conduct and guide to ethical business behavior are enforced by all officers, right down through the ranks, but additional measures help the company’s overall program stand out from others.

For example, CMS has extended several mandates from its code of conduct and whistleblower provisions to third-party contractors to improve accountability in its supply chain. And to keep employees on their toes, in 2012 the compliance department established a group of ethics ambassadors to lead an ethical accountability initiative to foster a culture of compliance and trust throughout the company with direct involvement at the executive level. These are just a few of the reasons why CMS Energy won the 2013 Corporate Secretary award for the best overall governance, compliance & ethics program in the small to mid-cap category.

‘To reach the stage we are at as a company has required strong and consistent commitment from our employees, senior management and the board of directors – and that’s really an ongoing process,’ says David Mengebier, senior vice president and chief compliance officer. He believes great compliance programs never really reach a point where they are complete. ‘You always have to be evaluating your compliance, ethics and governance programs and assessing your processes, your people and the various metrics you use to measure your results,’ he explains. ‘Then you can see where you can improve them.’

Mengebier says he is most proud of the company’s Ethics in Action Awards, which recognize employees who exemplify the highest standards of ethics and compliance within the company. The firm then awards a financial grant from the CMS charitable foundation to a local non-profit of the employees’ choosing. ‘The employees who have received these awards and have been recognized by the board and our senior management have shown tremendous pride,’ Mengebier adds. ‘It has created almost a sense of competition, and people are now striving to demonstrate that they are showing ethical leadership within the company.’

At CMS, the rules governing compliance and ethics aren’t just for the employees. The board has major ethical obligations as well, including certifying its own directors’ code of conduct each year and making sure each director undergoes training in ethics and compliance topics, including the compliance risk inherent in their role as directors and issues surrounding reputation management. The programs put in place at CMS have elements practically any firm can draw from.

For photos of the 2013 awards, click here.