What is Creative Accountancy? That's what I'm exploring on this episode. It's a term I've invented — a deliberate play on the term 'Creative Accounting' — to describe the approach which my guest Alastair Thomson adapts to his role as an accountant. He's actually much more than an accountant, but that's his background.Nowadays, Alastair advises companies in a growth phase, which requires him to adopt an approach that might not fit what you'd expect from an accountant. I'm fascinated by this because I think one of the root causes of human risk is people sticking rigidly to the remit of their role without thinking beyond that. To be clear, there are some roles where that is precisely what we want and need people to do — we don't want brain surgeons, air traffic controllers or those engaged in food safety to do other things than the task at hand. But very often, we do. So I think Alastairs' approach is of interest, not just to accountants, but other disciplines like Compliance, HR and Audit, to name just three. If we want to succeed in the 21st century, we will need more people to be creative and dynamic. To find out more about Alastair and his books: https://thebetterbusinesscompany.com/

How can we use crowdsourcing to obtain human risk insights? We’re all familiar with companies that have faced big issues in terms of misconduct. When there’s a big scandal — whether that’s banks engaging in bad behaviour or the diesel emissions cheating scandal in the motor industry - it’s very easy to look back with hindsight and point to things that could have been spotted at the time. But wouldn’t it be better for regulators, shareholders, customers and the companies themselves, if we could identify warning signs early on? That’s the challenge that my guest on this episode Dr Ruidi Shang, set to address. She’s an Associate Professor at Tilburg University in the Netherlands and a visiting scholar at Harvard Business School. Ruidi is the co-author of some new research entitled Tone At The Bottom: Measuring corporate misconduct from the text of employee reviews. 
What she and co-author Professor Dennis Campbell set out to identify was whether it would be possible to take information that is already available about companies, and determine from that which are more or less likely to have misconduct issues. To get hold of that information they turned to an unexpected source, Glassdoor.com — a website that allows employees and former employees to leave anonymous reviews about what it is like to work for a particular company. It’s designed to help jobseekers understand the realities of working in a particular place before they decide to apply or join a company. On the face of if this might sound odd. What can a website designed to help job seekers, tells us about the risk of misconduct? As it happens quite a lot. Because in talking about their employee experience, people end up describing the corporate culture. Since culture is a driver of misconduct, this is potentially highly relevant. Look at enough of those reviews, and you can start to build a pattern of what goes on in the organisation, and so form a picture of potential issues. What’s clever about this dataset is that it recognises that asking people about directly misconduct is a heavily loaded question. Respondents might choose not to answer truthfully, or they might not actually recognise the fact that a high-pressure environment — which they might actually enjoy working in — could be a driver of potential misconduct. So the best way to get a good picture is not to ask people about it at all. Rather its to crowdsource insights from lots of anecdotal accounts of what it is like to work within the organisation. It turns out that analysing the dataset on Glassdoor does have predictive capabilities. By backtesting the analysis with companies that had public scandals and exploring what was being said, before the scandals emerged, the researchers discovered that these reviews can provide advanced warning of potential misconduct issues. As we explore on the show.To find out more about Ruidi and her work: https://www.tilburguniversity.edu/staff/r-shangTo find out more about her co-author Professor Dennis Campbell: https://www.hbs.edu/faculty/Pages/profile.aspx?facId=10677To read Tone At The Bottom: Measuring corporate misconduct from the text of employee reviews: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3850554

What causes human risk in companies, particularly at senior levels? That's what my guest on this episode, Professor Elizabeth Sheedy, has been exploring in her research. And she's just published a new book called Risk Governance: Biases, Blindspots & Bonuses. Elizabeth has been on the show two times before (links below) talking about Bad Behaviour in Banking and Accountability regimes. This time, she's back to help us understand how the three 'b's in the title of her book, are key drivers of human risk in organisations.We also discuss a book she has co-authored called Auditing Risk Culture - A Practical Guide.As ever, Elizabeth, who is a risk governance expert based in the Department of Applied Finance of Macquarie Business School in Sydney, provides fascinating insights and some wonderful stories to support her analysis. To find out more about Elizabeth's area of research 👉https://researchers.mq.edu.au/en/persons/elizabeth-sheedyTo hear her first appearance on the show when we talked about Bad Behaviour in Banking 🎧 👉 https://www.humanriskpodcast.com/professor-elizabeth-sheedy-on-behaviour-in-banking/ Youll find her second appearance on Accountability 🎧 👉 https://www.humanriskpodcast.com/professor-elizabeth-sheedy-on-how-accountability-can-reduce-human-risk/To read more about Elizabeth's book on Biases, Blind Spots & Bonuses 👉https://www.routledge.com/Risk-Governance-Biases-Blind-Spots-and-Bonuses/Sheedy/p/book/9780367642655To download Auditing Risk Culture - a practical guide 👉 https://www.iia.org.au/technical-resources/publications/auditing-risk-culture---a-practical-guideDuring our discussion, Elizabeth refers to:The Good Judgement Project 👉https://www.gjopen.com/Research on Bonus Deferrals 👉 https://privpapers.ssrn.com/sol3/papers.cfm?abstract_id=3814623

How do human factors influence an inherently risky activity like scuba diving?That’s what my guest on this episode, Gareth Lock explores in his work as the founder of The Human Diver — a company that specialises in teaching the diving community about human factors.Whether you’ve ever been diving or not, it's fairly obvious that it’s an activity, that comes with a degree of inherent risk. After all, It involves getting into an environment that requires us to use specialist equipment because being underwater impacts our ability to breathe naturally and diminishes the use of some of our senses. It also exposes us to some potentially dangerous conditions - temperature, currents and air pressure for starters. Not to mention the sea creatures we might come across, who aren’t necessarily always going to welcome our intrusion into their world.As Gareth explains in our discussion, those dynamics can be made far worse by humans. Most accidents and incidents in diving arent down to technical failures, rather they are down to complacency, breakdowns in communication, poor decision-making, a lack of situational awareness or ineffective teamwork and/or leadership.To find out more about:Gareth - https://www.thehumandiver.com/theteamThe Human Diver - https://www.thehumandiver.com/Under Pressure, Gareth’s book - https://www.thehumandiver.com/underpressure

The Human Factors in Diving Conference - https://www.hf-in-diving-conference.com/In our discussion, we also refer to Tim Harford. You can hear the episode of this podcast featuring Tim here: https://www.podpage.com/the-human-risk-podcast/tim-harford-on-using-data-to-make-smarter-decisions/Listeners interested in hearing more about Human Factors will enjoy this episode of the show featuring Neil Clark: https://www.humanriskpodcast.com/neil-clark-on-human-factors/

Why might judges in the same Court give vastly different sentences for the same crime? The answer is noise. When experts who assess the same situation come to very different conclusions for no good reason, we risk bad outcomes.On this episode, I’m speaking with Professor Olivier Sibony, who is the co-author — along with Professors Daniel Kahneman and Cass Sunstein — of Noise: a flaw in human judgement.In our discussion, he explains what noise is, why it matters and what we can do to mitigate it.He also shares how this stellar line-up of authors came together.Olivier also helps me understand why a commonly adopted approach of using forced distribution for employee performance evaluations, which I have always found to be a bad idea, is…a really bad idea!Olivier has been on the show before. You’ll find that episode here: https://www.podpage.com/the-human-risk-podcast/professor-olivier-sibony-on-mistakes/ To find out more about Olivier, his research and his previous book ‘You’re About To Make A Terrible Mistake’ visit his website: https://oliviersibony.com/about/For more on Noise, the book see: https://oliviersibony.com/books/noise/To read a 2016 article on Noise by Daniel Kahneman: https://hbr.org/2016/10/noise

How can we manage risk in an increasingly complex world?My guest on this episode, Richard Fenning, has spent three decades advising multinational companies on geopolitics and security crises. He’s been involved in helping to manage situations involving kidnappings, terrorist attacks, coups d’etat, corruption scandals, cyber-attacks, earthquakes and hurricanes in places ranging from Iraq and Russia to Colombia and Nigeria. Richard is the former CEO of Control Risks (https://www.controlrisks.com/) a global consultancy that specialises in “helping businesses out of tight spots in difficult countries”. And of course when companies get into tight spots - and indeed when countries are ‘difficult’ - that’s usually because there are humans creating the tight spots or making the countries difficult. A perfect example of human risk in action.Richard has just written a book called “What On Earth Can Go Wrong - tales from the risk business” in which he shares stories from his time in the field. You can find out more about that here: https://www.eye-books.com/books/what-on-earth-can-go-wrongIn our discussion, we explore how Richard came to work in this field - after all, it’s not something most of us would grow up thinking of as a career and what his experience has taught him about managing risk. Professionally and personally.To learn more about Richard’s work visit: https://www.msp.co.uk/people/richard-fenning

How can we make better connections when we're on virtual calls and webinars? My guest on this episode, Dr Nick Morgan is a speaking coach and writer who helps people to find their voice in a physical and virtual world. For personal reasons, that he explains on the episode, Nick is on a mission to help people have better interactions with others. To find out more about his business visit https://publicwords.com/Nick's book "Can You Hear Me? How to connect with people in a virtual world" was described by Harvard Business Review (who area the publisher!) as “your essential communications manual for twenty first century work”. I have to agree. You can find out more about it here: https://publicwords.com/can-you-hear-me/Having been forced to pivot my Human Risk business (www.human-risk.com) from being mostly 'face to face' with some virtual work, into an entirely virtual business, I was looking for ways that I could learn to get better at my online interactions. Nick's book — which was published in 2018 — provided many answers and helped me to adapt. In our discussion, we explore Nick's story and what he's discovered in looking at how we interact. In case you’re wondering what the human risk angle is here, let me explain. Since we’re required - and even when we’re not required, will probably want - to do more virtual communication than ever before, it’s important we become good at the skills we need in order to do so. As you’ll hear from Nick, those aren’t the same skills we need to communicate in person. If we don’t master these skills, then we risk being misunderstood and we risk misunderstanding others. As we know, misunderstandings can lead to conflict, confusion and even chaos. So, if we want to avoid being part of human risk in action - or indeed if we’re tasked with managing it and want to help others avoid it - understanding how we can better communicate in a virtual world is a must-have, not a nice to have. It's a subject I've covered before on the show and if you're interested in this area, I recommend the following episodes:Hannah Thomas Uose on Zoom Trauma —https://www.humanriskpodcast.com/hanna-thomas-uose-on-zoom-trauma/Professor Elizabeth Stokoe on Conversations — https://www.humanriskpodcast.com/professor-elizabeth-stokoe-on-the-science-of-conversations/Jon Levy on Influence — https://www.humanriskpodcast.com/jon-levy-on-influence/

If we want to mitigate human risk, we need to engage the humans that might crystallise it. But how can we do that effectively?My guests, Lasse Frost and Jacob Danelund have been working on this challenge for some time. Their focus is on engaging target audiences, using techniques that range from gamification — turning something into a game — to story-telling, the natural way we all learn as children. Lasse and Jacob both work for Implement Consulting, a firm based in Denmark, that as you’ll hear, brings a very Danish way of looking at this challenge. I came across Implement when they were launching Complayance - a combination of the ‘Compliance and ‘play’ - a digital platform that delivers Compliance training through a compelling gaming interface.Lasse and Jakob aren’t just designers, they’re also podcasters hosting a show called The Human Firewall. In the episode, we explore why traditional approaches to the challenge of engaging people, sometimes don’t work and what more effective ones might be.Topics we discuss, include:Shadow IT 👉https://en.wikipedia.org/wiki/Shadow_ITThe story of Cassandra from Greek mythology 👉https://en.wikipedia.org/wiki/CassandraThe Human Firewall podcast 👉 https://podcasts.apple.com/dk/podcast/the-human-firewall/id1553442754Researcher Luca Dellanna 👉 https://www.luca-dellanna.com/Luca has appeared twice on the Human Risk podcast. You can hear him talking about Ergodicity on this episode 👉https://www.humanriskpodcast.com/luca-dellanna-on-ergodicity/ and COVID & Multiplicative Dynamics on this episode 👉 https://www.humanriskpodcast.com/luca-dellanna-on-the-coronavirus-and-multiplicative-dynamics/ComPlayance, the gamified compliance training platform that Implement Consulting, Jakob and Lasse's company Implement consulting has developed 👉https://implementconsultinggroup.com/complayance/For more on Implement, visit 👉https://implementconsultinggroup.comThe origins of the phrase 'hocus pocus' 👉https://wordfoolery.wordpress.com/2019/02/25/the-strange-story-behind-hocus-pocus/GDPR - General Data Protection Regulation - 👉 https://en.wikipedia.org/wiki/General_Data_Protection_RegulationWARNING - the following links may offend some readers/listeners, so view at your own peril and on a personal, not work device.The Human Centipede horror movie 👉https://en.wikipedia.org/wiki/The_Human_Centipede_(First_Sequence)John Dillermand, a children's TV show with an adult them 👉https://www.theguardian.com/world/2021/jan/06/john-dillermand-denmark-launches-childrens-tv-show-man-giant-penis

What does the word 'compliance' mean? On the face of it, we've all had experience of it under COVID as governments have introduced rules to influence our behaviour to stop the spread of the virus. But its influence is far broader than that, with applications ranging from corporate environments to the medical profession. It's even become an industry in its own right, complete with its own professional organizations and creating an ever-growing stream of jobs. As a result, the term has various meanings and academic studies looking at how it influences human decision-making have often been undertaken in siloes. If we want to understand what compliance means and how its objectives can be more effectively delivered, we need to look across the spectrum of applications.My guests on this episode, Professors Benjamin van Rooij and Danny Sokol, are the co-authors of a new book called The Cambridge Handbook of Compliance which seeks to meet this challenge. The Handbook takes a broad approach and explores the idea of compliance as being the interaction between rules and behaviour. Using this framing, it sets out to deliver a comprehensive understanding of what compliance is and what mechanisms and interventions are used in its service. By exploring different contexts and ideas, the Handbook explains what compliance is and provides a guide to how its objectives can be more effectively delivered. In our discussion, which was originally filmed as a video that we’ll be sharing as clips on social media, Benjamin and Danny explain why they wrote the book and what they hope to achieve and highlight some of the key themes it covers. By understanding what compliance is, and how its objectives can be more effectively met, we can adopt what Danny and Benjamin call Compliance 2.0.They also reveal their favourite or least favourite rule!Not only are Danny and Benjamin engaging guests, but their insights will be of interest to those working in compliance and those of us who are subject to compliance requirements. In other words, all of us! For more on The Cambridge Handbook of Compliance 👉https://www.cambridge.org/core/books/cambridge-handbook-of-compliance/A7A803D987C9C001C6569395BEE5051CTo download the Introductory Chapter of the Handbook for free 👉https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3563295To find out more about Benjamin and his research: 👉 https://www.law.uci.edu/faculty/affiliated/van-rooij/👉 https://www.uva.nl/en/profile/r/o/b.vanrooij/b.vanrooij.htmlTo find out more about Danny and his research:👉https://www.law.ufl.edu/faculty/d-daniel-sokol👉https://www.whitecase.com/people/daniel-sokolTo hear Benjamin's previous appearances on the podcast:On his book 'The Behavioural Code' 👉 https://www.humanriskpodcast.com/professor-benjamin-van-rooij-on-the-behavioural-code/On his research into COVID Compliance 👉https://www.humanriskpodcast.com/professor-benjamin-van-rooij-on-covid-compliance/

Why is Peloton - a company that sells bikes that allow you to take on-demand and live classes at home - so successful? With a Net Promoter Score of 94 (that's 94% of customers who would recommend it to someone else), there must be a psychological explanation. That's what my guest Lisa Richardson has researched as part of her psychology masters.I'm interested in this because I've recently joined Peloton and absolutely love the product. I didn't think I would since I'd previously viewed it as a bit of a cult. The kind of people who had bought it, seemed to be incredibly fanatical and I didn't think that would be me. Yet it is. And this intrigued me. So I wanted to know more. Not just to answer my own curiosity about what had driven me to be so committed to an activity, I would never have contemplated doing in a gym, let alone at home. But also, because I think there are clues there about how we might persuade people to do things they're not naturally drawn to do - like comply with Compliance requirements at work.So whether you're an existing Peloton fan, you really don't understand what the fuss is about, have never heard of it, or as a cycling fundamentalist, think it's a terrible watering down of what cycling should be, this show has something for you. Lisa joins me to tell me what she discovered in her research. And what she shares has real implications for managing human risk.To read an article Lisa wrote about her research: https://thriveglobal.com/stories/applying-the-magic-of-peloton/You can read Lisa's research "Peloton as a Facilitator of Hope: Pathways to Initiate and Sustain Behaviors that Enhance Well-being" here: https://repository.upenn.edu/mapp_capstone/182/To find out more about Peloton, visit their website: https://www.onepeloton.com/