The Importance of Ethics in Business Success with Tom Topolski of Parsons

Host:
Welcome back to another episode of Engineering Influence, a podcast by the American Council of Engineering Companies. Now America’s engineering industry is engaged in a daily effort to improve the lives of every American, but how they go about doing that work is just as important as the work itself, which really brings us to today’s topic – the importance of ethics in business and the role of compliance and how that plays in corporate success.

Host:
And I’m really pleased to be joined by my guest today. Tom Topolski. He’s the Executive Vice President for Infrastructure Business Development at Parsons. In his role, Tom oversees efforts to achieve top and bottom line growth by identifying market opportunities to extend Parsons’ infrastructure portfolio. And really what sets Tom apart from many of his peers in the industry is – especially in business development – is the fact that he is also a Certified Compliance and Ethics Professional and serves on Parsons’ ethics committee.

Host:
And that is interesting in itself. But beyond that, Parsons for the 11th year running was just named one of Ethisphere’s most ethical companies in the world. And it’s not a small, small honor. It’s something that is, that is very, very competitive and very highly sought after. So 11 years in a row, first time Parsons has won it as a public company. And it’s great to have Tom on the show today to talk about the award and also just kind of the outlook that the company has on ethics, compliance, you know, business practices and why it’s so important for the engineering industry and why it just helps, you know, accentuate what we do. So, Tom, thank you for being on.

Tom Topolski:
Jeff, thank you very much for having me. It’s a pleasure to be here. Yeah, it’s just great to have the opportunity to talk to you about this.

Host:
Could you tell us a little bit about what you, what you do at Parsons?

Tom Topolski:
Well, as you mentioned, I’m the Executive Vice President for Strategy and Business Development across our critical infrastructure business. So that includes all modes of critical infrastructure. It’s highway, bridge, rail and transit, aviation ports and marine, smart cities, intelligent transportation systems. You know, the gamut of – Parsons is very much a full service company providing services from the conceptual planning feasibility studies through to design, construction, asset management.

Host:
So really it’s that whole infrastructure portfolio that you cover.

Tom Topolski:
Right, and solutions. And I think why ethics and compliance is really important in that space too is people take it for granted, right? But everybody uses some form of transportation to get where they are today, Right?

Host:
Exactly.

Tom Topolski:
We serve hundreds of millions of people when you think about it in terms of the infrastructure, right? Whether it’s people driving on our roads using our bridges, riding on the Metro system, using an airport. And so there’s a lot of public trust that’s put into making sure those structures are designed properly, they’re constructed properly and that they’re safe.

Host:
Absolutely. I mean Parsons is an international company. You do business around the world. You have about 10,000 employees, I think is…

Host:
16,000 employees.

Tom Topolski:
How, how important is it to drill the message down of doing business in an ethical way, especially when you’re dealing with other countries that have different rules and regulations and practices on business?

Tom Topolski:
Well, Jeff, let me give you a couple of good examples. I was running our business in the middle East for a number of years and I can give you two examples that is, that I’m particularly proud of and I’ve always used these as ethics and compliance moments when we start meetings and so forth. In one case there was a country in the middle East after nine 11 that they started to surveil communications. And they were basically looking to see if there was money laundering going on for any terrorism activities, things like that. I don’t know if they ever found that, but what they did find was a very large corruption scheme at one of the public works authorities. And what I’m proud of without going into a lot of details is that our company was the only one in our peer group, our company that not even had anyone questioned.

Tom Topolski:
So what that told me, I mean, every one of our other competitors either had their managing directors deported, put in jail, people were questioned top to bottom, but we weren’t even questioned. So what that said to me was not only did we have the tone at the top correct, but it was the mood in the middle and the buzz at the bottom as they say in the compliance industry, that it was in our DNA, that we didn’t get involved in any of those kinds of activities. Another example was in a, in the middle East was when we participated in a design competition and we spent a lot of money on that. When you’re doing a design competition, you have to come up with the concept design, the architecture of it and so forth. As the procurement proceeded, we and I was called to a meeting with the director of the public works department. At that time I realized that it was not going to be a transparent procurement and essentially said that we would withdraw from the competition. And again, what’s important wasn’t my decision on that. But when I called the president of our global business unit, I had full support. It wasn’t like, Tom, are you crazy? Get back in, you know, I have the full support. And so again, it’s a culture right top to bottom. Everybody knows to do the right thing. And I think that’s one of the things that’s always differentiated Parsons in the industry.

Host:
For our members. I mean we have firms of varying sizes. We have, you know, of course, solo to small practitioners all the way up to Parsons and your peers in the international space. And we had one of our executive committee members on a couple programs ago when he was talking about leadership. He’s the, he’s the chairman of another firm out of Michigan. And he, he was really talking about the need to kind of drill down through all the layers to try to get a when he was talking about business, it’s more of the vision, strategic vision. And I guess it’s the same for really an ethics and compliance program.

Tom Topolski:
Let me give you another good example of how you apply that and how you build up the client trust. Also going back to the middle East, and this is about 18 or 20 years ago. So it’s not a new thing with Parsons. It’s been in our DNA I think really since the inception of the company. But in Dubai when there was just massive construction going on, well and it’s continued, we introduced the concept of integral abutment bridges. And so by doing that, we reduce the cost of bridge construction by about 50% with reduced quantities, which we demonstrated. But more importantly to it was the life cycle cost. Because when you’re using integral abutments, you eliminate the need for the expansion joints and the bearings in most cases. So from a life cost, from a maintenance cost is greatly reduced. Now in doing that and why this is important is our design was on a percentage of constructed value. So we actually reduced our design fee by doing that quite substantially. But the client could obviously see what we were doing. We earned the trust and ultimately ended up with a tremendous amount of market share because they knew they could count on Parsons to do the right thing and you know, create the most efficient and effective design for them considering life cycle.

Host:
Absolutely. Yeah. As a lasting effort if you can prove that you’re doing things right.

Tom Topolski:
Yeah. And especially where you’re really, again, you’re using it, it’s the public trust, right. And it’s using money in the public interest. And so if you can demonstrate that you’re using that, those funds again for the beneficial purpose of the project, delivering it as efficiently as you can. I do think that no better way to gain trust.

Host:
Yeah, absolutely. And an award like Ethisphere is, like I said, it’s a, it’s a sought after award. Some of the most recognizable brands in the world are our recipients. And you are just one of, I think one of two engineering firms that actually were named. And what does that mean for your role in business development to be able to go out to potential clients to potential markets and be able to say, you know, we were able to achieve this thing.

Tom Topolski:
I think it means a lot. It’s a, it’s a huge differentiator. And I think what adds to that is that we’ve done it 11 years in a row. So it shows that we, it’s not just something that we’ve decided to do because it was seen as something that was important in a given year. No, it demonstrates, I think, the ongoing commitment that just like our commitment to health and safety, environment, quality, sustainability, innovation, all of those core values, integrity, ethics and compliance is central to the way that we conduct ourselves, the way we do our business. And it is, it’s it, yeah. As you know, very well winning the Ethisphere recognition. It’s, it’s not an easy task. I mean, there, it is a very rigorous process. So it demonstrates the commitment amongst all the 16,000 of my peers. Yeah. Yeah.

Host:
And from your position, both as a certified ethics professional and then also on the on on the ethics committee at Parsons for if you were, if there was a firm there that was looking to either revise or to strengthen its own compliance program and you know, what, what are some of the top things they should keep in mind if they were to do that?

Tom Topolski:
Great question Jeff. And I think because I’ve seen the other side of it, of firms that really haven’t had quite the same commitment that Parsons has always had. I believe having someone, for example, I and indeed I may be the only a business development professional in our peer group who has a CCPI. But what it does is it demonstrates to the larger population the commitment that ethics and compliance is not here as a police force or an enforcement. No, it’s rather we are here working with you to address concerns. You may have to address questions. You may have to ensure that we’re imparting what it means to do business with integrity.

Tom Topolski:
You know, to have the highest commitment to ethics. So having people from the business to, so for example, having me on the ethics committee, I know what it’s like to run the business. I know what it’s like to pursue with a procurement processes like or challenges come up so I can add a lot of value rather than just having somebody on the ethics and compliance compliance side who hasn’t necessarily been in the operation. So we on the committee, we have two other of my colleagues. We have the EVP for corporate operations and then we also have a VP for corporate compliance operations. So it’s a very tight group. We interact with each other on a daily basis, reviewing questions that come up, cases that come up. And the other thing that I always try to do too is I get the FCPA blog.

Tom Topolski:
I don’t know if you’ve ever heard of it. And so what I do is I share the FCPA blog, not all the time because then it’s overload and people can look out of this perfunctory. But I give a good example when there was a Houston Astros scandal with the, with the cheating and the world series, and there was some articles about that and the FCPA blog. I was really delighted actually about the amount of dialogue that came out once I forwarded that article. And people expressed personal, very passionate stories about how it affected them because they were Houston Astros fans and so forth. But it’s in that way, I believe that you build up the culture and people recognize, look, I need to not only do this from my peers, I need to do it for myself. Right? I mean, can you imagine if you had a compliance issue, right?

Tom Topolski:
And you had to, you know, you had to, you lost your job or worse, you had, maybe you, you know, had a criminal case against you. How do you face your family, your friends, you know it’s you never get your reputation back after something like that.

Host:
And kind of a shameless plug for our webinars, but we actually do have a webinar available that, that focuses on FCPA compliance. Bill Steinman who contributes to the FCPA blog, actually, it actually held that webinar. So that’s up there for members. If you want to go take a look, that’s the foreign corrupt practices act. Of course that’s more international work. Of course. But still, you know it’s a body of law, which is the DOJ is doing a lot to enforce increasingly. So

Tom Topolski:
Just like to let people know if they didn’t know I last year in 2019, it was a record year for DOD DOJ enforcement of the FCPA violations, $2.6 billion dollars. So you know, even when we always talk about health and safety, of course the overall overarching objective is to make sure everybody goes home at least as healthy or more healthy than they were when they started out. But the same but the results. So of course the financial impact of it, right? Cause you don’t want workman’s compensation claims and so forth. Same thing with ethics and compliance. We want to do things the right way, but there is I, if you look in our peer group of all the firms that have either gone out of business or have become acquired that aren’t on the map, firms that have had compliance issues tend to not survive it.

Tom Topolski:
You know, because the fines are steep. Then you tack on the legal costs associated with that, the lost opportunity costs. It can kill the firm and you need to think about, you know, the jobs lost reputational issues.

Host:
It’s not an add on. It has to be a core business practice.

Tom Topolski:
Yeah, you can’t. And again, that’s why you know, it is kind of glib to say tone at the top, mood in the middle, buzz at the bottom. But, but the point of that is, is to really drive home to everybody that it has to be in the DNA and that people can’t just give a wink and a nod. You really, you have to believe it. You have to. And that’s what’s wonderful about Parsons too. It’s always, you know, I’ve been with the company 12 years, over two stents and I missed the company while I was away because I did miss that really strong commitment. But I’ve always seen it from the earliest days I was with the company through to today right from our chairman, our board all the way through to people out in the field. People take it seriously and and believe in it. And you can feel that.

Host:
Yeah. Well I wanna I want to take advantage of your expertise also in business development because some, some wider industry questions because we always try to get a handle on where things are trending and wanted to get an idea from you from your perspective looking at the infrastructure space and and, and where do you think technology is taking us? Where do you think the, you know, the next 10 years lays for firms or the industry doing work in the public sector? And, and you know, where’s technology going? What’s Parson’s kind of looking at? How are you positioning yourselves?

Tom Topolski:
Great question. I, I liked it. Well, first of all, I, what I always say to people too, I feel very fortunate to be in this business at this time because I think it’s the most exciting time in our industry and probably over a hundred years. And you know, if you really look back, it was just over a hundred years ago that automobiles started to really take hold and have mass you know, ownership and replace the horse and buggy. And I think that right now the opportunities are immense. I liked it. I think Parsons with our focus on technology, our focus on innovation, always our quest for doing things better. You know, making it things more efficient and effective position us where the nexus between the traditional infrastructure, which we had been doing for over 75 years and technology enabled infrastructure. You look at construction, you’re going to more modular construction, you’re going to drones, robotics, you know, for example, if it’s signaling in a subway system, right?

Tom Topolski:
It’s easier to have a robot go into some of those confined spaces than put people at risk. It’s more efficient. And you know, again, sometimes there’s labor shortages as well. So I think you’ll begin to see more robotics in some ways, scheduling and programming, artificial intelligence coming into play. But I think some of the big transitions are, you know, you look at the smartphone, right? 10 years ago, if I held out a smartphone and said, you’re going to be able to do your banking on that, you’re going to be able to call a taxi on that. You’re getting kind of all your videos, your music on that. You’d say you’re crazy, right? Yeah. But think of the disruption that the smart phone has had on so many different industries, right? So I think Uber and Lyft are the first stage of getting us to connected and autonomous vehicles.

Tom Topolski:
Now, right now, the impact is more traffic, but the convenience factor of Uber and Lyft, it took hold immediately, right? I mean, people adapted to that. They’re willing to spend a little bit more money for the convenience and comfort. So the next step, and I think where we’ll begin to really realize the benefits is when we do have the adoption of more autonomous vehicles. And I don’t think that that’s that far away. And I think the combination of that with electric vehicles as well is going to be transformational. And then a lot of it, what we, I always like to say I’m an airport is really a city with runways. And so I think that’s another place where you can incubate a lot of the smart cities technologies that you can then more broadly apply across two cities and States. And so it’s an exciting time for us.

Tom Topolski:
And I think I’m, I’m delighted to be with Parsons because I think with the technology we have, we’re incredibly well positioned to capitalize on the trends and shape the trends. In fact, absolutely. I think that, that, that sentiment is shared that technology is going to unlock a whole host of new opportunities for the industry regardless of size. Well, just as an example to think about airports, again going back there, you know, if you look at manufacturing and if you ever watch a manufacturing floor, most of that has robotics, right? Whether it’s bringing parts, whatever, you know it’s a very, very automated. If you look at the air side in particular, there’s no reason why a lot of those activities couldn’t be automated that are now you know, where you have people driving around on your, so from a safety factor and efficiency factor to automate the air side, I think we’re not far away from something like that.

Host:
Yeah. And that’s, that’s something which from a policy side ACEC has been working with the airports is the facility charge. It’s getting that increased so that airports can look to make investments in physical plant.

Tom Topolski:
We hope to work with ACEC on the land side as well because I think there is a massive opportunities for them.

Host:
Without question, without question. We’ve got, we have a, we have a great opportunity for a, for a long term and substantial infrastructure bill and hopefully one that does take advantage of policy and policy pro projects and, and, and kind of test beds for bringing a lot of this from, from the drawing boards in the reality.

Tom Topolski:
And, and Jeff, I think what we need to do, you talked about policy and funding and I think what we really hope to do working with the AECC in concert is, is ring fencing the funding because sometimes it, it, it’s we don’t have that consistent funding, right?

Tom Topolski:
We’re always sort of wondering, is a transportation bill going to be passed? Is there enough funding? Is chasing our tail in one way. And so consequently, if you look and you compare us globally, we’ve fallen behind and our infrastructure is in pretty dire shape. So we really need that focus and making sure that the funding is there, that it’s consistent and allows us to really do her job and deliver infrastructure that again, will serve millions of people every day. Without fail. Yeah. And that’s one of the things we always take to the Hill when we have meetings is, you know, our industry are a bunch of problem solvers. We know there’s a problem and there’s a solution and the solution just has to involve longterm predictive, sustainable funding to actually get this stuff done. Think about it, right? You look at, I don’t know if you’re aware, but the average travel speed in Manhattan during peak commute hours is about four and a half miles an hour.

Tom Topolski:
Okay. So think of the economic impact that has where you can’t move people and goods effectively and efficiently. So this is a, it’s things like that and there are ways to solve it. And I do think technology is going to end up being a big part of improving congestion.

Host:
Well it’s, I think we should a good place to leave it off there. I’d love to have you back on the program later. We can kind of expand on this and maybe get into specific areas of infrastructure that have great promise. But again Tom Topolski, thank you so much for being onto the show on the show today with us. Talking about ethics compliance. Congratulations on the award. We’ll have a link to that in the show notes and again just great having you on and thank you so much.

Tom Topolski:
Jeff, It’s been my pleasure. Thanks for having me.