1. Risk Awareness: The Need for Transparency in Operations Tom McNamara Senior Vice President, Global Sales EthicsPoint

2. Risk is…  Real & reputational  Compliance-based Regulatory Contractual Socially responsible  Manageable Reputation-based fraud is 5 to 7 times more impactful to share value than financial fraud. FEI Professional Development Session

3. Risk Mitigation: The Process  Understand your risks  Evaluate Probability Impact Velocity  Mitigate Communication and training Plan contingencies  Monitor Compliance obligations Risk events Stakeholder feedback  Respond and learn Risk Event Probability ImpactMitigation Contingency Monitor FEI Professional Development Session

4. Operational Feedback and Reporting Risk Awareness Knowledge Risk High Low 0%100% © EthicsPoint, Inc. 2009-2011 All Rights Reserved Open Door Policy Hotline/Helpline Policy & Procedures Compliance Training Disparate Data Silos Survey Feedback Transparency FEI Professional Development Session

5. Disparate Data “Organizations often support between five and eight different database technologies, and 50 different sources of data from the operational side.” - Gartner Research Vice President and Research Director Kevin Strange FEI Professional Development Session

6. Problem: Lack of Transparency  Only 3% of misconduct reports come through the hotline -- ERC 2009 National Business Ethics Survey  Compliance and ethics receives only 6% of available employee information about top risks -- Compliance and Ethics Leadership Council research 50% of observed business misconduct is never reported 60% of information reported to managers by employees is “siloed” 21% of reported information relevant risk is shared with legal or others, but is not available to compliance  Issue is getting worse with three distinct generations in the workforce FEI Professional Development Session

7. Information Gathering Knowledge |Transparency Risk High Low 0%100% Open Door Policy Hotline/Helpline Survey Feedback Systems and Technology Process Policy & Procedures Compliance Training Data Integration Voluntary Buffer Culture Analysis Organizational Complexity Vertical Complexity Number of geographies served Number of organizational entities Employee Headcount Union/Non-Union Weak Culture/Strong Culture Historical Significance Regulatory Requirements Industry Dynamics Common Risk Components Risk Appetite Social Responsibility Understanding Risk FEI Professional Development Session

8. 8 What should you be capturing?  Industry-based operational risk Fraud Harassment Issue or event  Security control breaches  Internal audits  Regulatory and contractual compliance issues  Hotline (web and telephony)  Open door policy (internal reports)  Exit interviews Gain transparency into siloed activities and disparate data sources. FEI Professional Development Session

9. Do you promote awareness?  Employee awareness  Vendor and representative awareness  Repeated communication events  Feedback to reporters  Sanitized reports and newsletters FEI Professional Development Session

10. Questions? FEI Professional Development Session Tom McNamara Senior Vice President, Global Sales EthicsPoint tmcnamara@ethicspoint.com © EthicsPoint, Inc. 2009-2011 All Rights Reserved