With so many rules and regulations, which are different from jurisdiction to jurisdiction, corporate compliance and its enforcement can present businesses and their legal teams with a tangled knot of challenges. John Kahle, though, follows a simple philosophy to carry out his job: do the right thing.
“Compliance means keeping an eye on the big picture, with an emphasis on doing the right thing, period,” says the vice president, general counsel, secretary, and chief compliance officer at Kimball Electronics Inc. “It means I can trust you when no one’s looking. At Kimball, we emphasize this as part of our corporate culture. ‘Do the right thing’ is our motto.”
Courtesy of Kimball Electronics
Kahle has arrived at this mind-set over the course of a career spent steadily acquiring more understanding of internal business practices. Growing up on a farm in Indiana, he didn’t necessarily aspire to become an attorney, but he was a good student, and his teachers exposed him to more possibilities, like accounting and the law. The first in his family to attend college, he pursued a degree in accounting from Indiana University, graduating summa cum laude. He began his career as a certified public accountant but did not find accounting and tax to be his passion, so he returned to Indiana University to attend law school.
After graduating, he worked in private practice for a few years but found that it, too, lacked fulfillment. Hourly billing struck him as inefficient, and when he and his wife began planning a family, personal and professional reasons prompted him to consider a change. Luckily, serendipity stepped in.
Searching for a way to make a greater contribution as a lawyer, he came across a recruitment ad for Kimball International, an Indiana-based company, for its first in-house legal counsel. He applied for the job and was hired in 1987 by Jim Thyen, Kimball’s CFO at the time and eventual CEO. Kimball Electronics was a division of Kimball International, and he joined Kimball Electronics when it was spun-off from Kimball International in November 2014.
“I didn’t like the nonproactive nature of private legal practice,” Kahle says. “The client would come in with a smoking gun and expect me to fix it. In the corporate world, you get involved earlier; it’s more preventive.”
To help Kimball navigate new regulations and tariffs in the electronics industry, Kahle instituted five key elements into its compliance model: leadership, risk assessment, standards, training, and oversight. “The responsibility for compliance is in the operations,” he says. “If we make mistakes in accounting, that doesn’t mean the compliance program is not good; it’s the responsibility of the finance group. When we organized our overall corporate compliance program, we made sure to look at who had authority and responsibility.”
He cites recent controversies, including at Wells Fargo, where sales pressures inspired employees to create fake bank and credit card accounts without their customers knowing, and at Volkswagen, where the company directed employees to install devices in vehicles with diesel-powered engines to deceive emissions testing, as examples that illustrate how even a robust corporate compliance program can fail. “I’m sure they had tons of compliance people, but they still cheated,” Kahle says. “That’s why the first part of compliance requires that you make people accountable.”
Kahle also a takes proactive approach to keep Kimball prepared for legal or regulatory shifts. Most recently, the current tariff wars with China found Kahle heading to the nation’s capital. “China has components that we can only get from there that are unique to our products, so we had to go to work quickly,” he says. “We testified against the tariffs. It didn’t stop them, but we wanted our customers to know that at least we didn’t stand by; we took action.”
During his tenure at Kimball, Kahle has enjoyed watching the compliance culture develop further and be applied in a variety of Kimball facilities around the globe. And, he has also enjoyed getting the chance to deal with so many different people in different areas of the ever-stimulating company.
“No society thrives without the application of intellectual property—creating something of value, designing, making a product,” Kahle says. “At its core, business is about invention, changing things. I find that fascinating.”
