The following interview is with Juliette Gust and Tricia Fratto, founders, Ethics Suite.
RB: So, Juliette and Tricia, how about sharing some of your background?
JG: Well Richard, I think I may be the only hospitality operations manager turned forensic accountant that I know! My first career was in hotel and restaurant management, and I spent about 15 years working in hotels, restaurants, casinos and convention centers in cities such as New York City, Boston, and Las Vegas. During that time, I found myself dealing with a host of challenges related to misconduct, fraud, theft, and mismanagement, and they were really fascinating (and sometimes painful!) to me. So, I returned to school for a second degree in accounting and after graduation, started my next career. I spent almost seven years working with PwC’s hospitality, forensic, and regulatory practices, gaining valuable experience working in the U.S. and abroad on a variety of matters including money laundering, corruption and bribery, embezzlement, and financial statement fraud. After that, I was fortunate to find a role where I could leverage both my hospitality and forensic accounting skills as the global Director of Fraud & Investigations for Starwood Hotels & Resorts.
After Marriott acquired Starwood, I decided to found this company, named Ethics Suite. We are focused on providing companies that may have less resources with a way to provide their employees with a secure, simple, and affordable communication channel to report any potential wrongdoing. Companies often require assistance in investigations, ethics and compliance program implementation and training, and developing proactive fraud and anti-corruption audit programs, so we also offer consulting services in these areas.
Tricia and I worked very closely together at Starwood. She is also very passionate about this area – opening lines of communication and getting to a problem while it’s still small and manageable, and taking proactive programmatic steps to maintaining an ethical business. So, I invited Tricia to join me in making this company a reality, and we launched Ethics Suite this past summer.
TF: There is also an unusual symmetry to my career path. My first professional position was as a catering sales manager. After a few years, I decided to focus on becoming a lawyer – the path I’d always wanted to take. To fund the cause, I worked for IBM for ten years as a database manager while finishing undergrad and then law school at Fordham. After graduation, I worked for Sidley as a litigator, focused on internal and government facing investigations, and Norton Rose in the White Collar group. From there I moved into my first in-house position at Starwood, where Juliette and I met. At Starwood, I reported to the CCO as the Director of Global Investigations, supervising the worldwide anti-corruption/anti-bribery investigations and remediation. I also worked on other legal-compliance initiatives, including compliance policies and processes. After the Marriott integration, Juliette invited me to launch Ethics Suite with her. I jumped at the chance to partner with someone who shares my commitment to this space and whose vision made this groundbreaking approach possible. Combining all my careers was also an opportunity I couldn’t miss!
RB: Well, thank you, and can you tell us a bit more about Ethics Suite?
JG: Ethics Suite is the first and only comprehensive platform for the anonymous reporting and tracking of workplace misconduct, fraud, or theft designed for the hospitality industry, with distinct, industry-wide reporting sites for the lodging and foodservice sectors:
HotelEthics.com, RestaurantEthics.com and BarEthics.com. We offer subscription rates for businesses of all sizes, and the cost includes unlimited reports and users, and 24/7, secure access to MyEthicsSuite, where clients can access their reports, exchange information with anonymous reporters, and access analytics.
RB: Is Ethics Suite only available to the hospitality industry?
TF: Although we are focusing on the hospitality industry, we encourage inquiries from outside the hospitality industry since we believe this model is adaptable to virtually any industry. For example, we are currently discussing how to help implement a cost-effective strategy for employee reporting and case tracking with a number of companies in other sectors, including healthcare, public relations, and media.
RB: Why is having an anonymous reporting channel so critical?
TF: The financial and reputational risks are staggering. We’ve all seen the velocity at which even a single social media post takes off into the stratosphere. This makes it even more critical that organizations take steps to prevent, detect and deter fraud, theft, and misconduct.
JG: I’m sure everyone has seen that hotels and restaurants are under fire these days. The number of harassment claims is staggering and the EEOC has said on several occasions that the owners and operators “failed to take action” in response. This is obviously bad news for any organization, both in coming litigation and in reputational and other damage. Again, we think that the value of getting in front of these issues can’t be underestimated and we offer tools to do just that. It is always better to resolve these issues internally whenever possible, before they spiral into larger, costly or public problems.
RB: Why do you offer a web-based solution?
TF: For several reasons, actually. I think we have all moved to a more automated lifeand we did our research. The very notion of a “hotline” is itself outdated – people are generally now more inclined to use email, text, or web-based systems. Surveys confirmed for us that tips submitted by email and online forms are now more common than by telephone.
JG: Hotline call centers are also very labor intensive, which is costly. This method also ensures that employees understand their reports are completely confidential. This really helps to encourage employees to share their concerns and is the most effective way for an organization to remain informed about conduct that may impact its business.
RB: So what else makes this unique?
JG: Traditional hotline options offer “white-labeled” websites for employees to use. These are exclusive to each company, branded by that company, and perhaps include a message from the company’s leader on the page. We think this has a chilling effect on employees and deters them from reporting. They don’t believe that an independent, third party runs the service. If an employee doesn’t want to report their concerns directly to a supervisor or company representative because they fear retaliation, they are also going to feel hesitant reporting on a branded website. Our sites are industry wide and not company specific. So, for example, anyone from any restaurant at any location can report anonymously through the same site. It’s transparent, easy to access, and portable.
This model requires an expert, not just recorded by a telephone operator, review each report. Each report is reviewed by Tricia and me, so that we can alert our clients about key issues identified in their reports. This will help our clients maximize the benefits of the information.
TF: Another feature we are very excited about is our ability to collect data. Since we’re industry-wide, this will allow us to provide very specific data that we believe is the first-of-its-kind. With this information, we can show our clients how the issues they are confronting compare with other companies in the same industry.
Thank you, and for someone who might want to get in touch with you, what’s the best way to connect?
Thanks you, Richard, for spending time getting to know us! Our website, https://www.ethicssuite.com/ has a contact form, or you can email info@ethicssuite.com, jgust@ethicssuite.com, or tfratto@ethicssuite.com. We also hope you’ll follow us on facebook, LinkedIn, and Twitter!