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Harry Cassin
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Eric Carlson
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How co-working magnifies compliance perils

My writing desk these days is located in a co-working space in Austin, Texas. The atmosphere is bright, cheerful, and totally informal. But for some of the companies working here, this space is also an unrecognized compliance minefield. 

Here’s the problem. Some people here lack, um, situational awareness. They forget (or don’t care?) that when they talk to colleagues in the common areas — at the big open work tables, in the community lunchroom, around the water cooler — other people might be listening in. When they yell into their phones while walking the halls, or put their calls on speaker, it all reaches the ears of outsiders. When they hold meetings in the conference rooms scattered throughout the workspace, the walls aren’t nearly thick enough to keep all the sound inside.

Some also forget that one reason the space is so bright and cheerful is because most of the interior walls are glass. The light shines through the glass walls, and everyone can see what’s happening everywhere.

As a result, and through no conscious effort whatsoever, I’ve learned more than I want to know about some of the companies that I share this space with.

One company, for example, is struggling to make money on sales that don’t close within 120 days. At this point, I may know more about the company’s problem with “long tail transactions” than some of its own investors and lenders.

Another company plans to demand a 20 percent discount from all of its national suppliers beginning on January 1, 2020. The suppliers don’t know that yet.

A third company here, according to employee scuttlebutt, just hired its first general counsel and chief compliance officer. The fact that a bona fide unicorn founded more than two years ago hasn’t had a GC / CCO is head-scratching news.

Along with the fruit and vegetable-infused water at this co-working space (today it’s lime and cucumber — delicious), the place is crammed with computer screens, dozens of which are visible to anyone walking through the glass-walled hallways.

The screens display spreadsheets as well as charts and presentations, some of which are marked “strictly confidential” and “internal use only.” I usually make an effort to avert my eyes, not wanting the burden of knowing too much inside information. But I suppose anyone walking the halls (and there are always a lot of people doing that) could be memorizing some of the data or even snapping screen shots with an iPhone.

Old-fashion whiteboards are still used here. Some face the glass-walled hallways. Anything important enough to be written on a whiteboard should probably be shielded from public view.

There are even paper charts hung on the glass walls, facing inward toward the people in the conference rooms and offices. Because the walls are glass, the light shines through the paper, making the writing clearly legible from the halls, albeit backwards in Leonardo da Vinci-type script. I’ve learned you don’t need to be a Leonardo to read backwards. After a while the skill comes naturally.

My co-working space is a wonderful place. I love coming here to do my daily typing. But some people completely forget or don’t care that their loud conversations and exposed office paraphernalia are essentially on public display, thereby revealing to the world their company’s inside, confidential, and even proprietary information. That’s when the co-working arrangement morphs into a compliance minefield — especially for the poor general counsels and chief compliance officers coming late to the co-working party.

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  1. “Like” This is everywhere. Your competition either has the broad advantage or, you have a huge sabotage opportunity here. Hmmmm. Lol. As usual, good read RLC, thank you.

  2. Excellent article! I am an occasional user of co-working spaces: I drop in a few times a month. I have two basic criteria for when I go. First, I’ve got cabin fever at home; and, second, I’m not working on anything sensitive that can be seen or heard by others.

    I would also add that many of RLC’s observations can be applied to large corporations and their penchant for (money saving) open plan offices. There is, for instance, way too much to be learned simply by sitting within earshot of HR and their employment lawyers.

  3. I have already heard of law firms that see it a a good marketing opportunity to have lawyer sit every now and then in co-working spaces – you get to hear legal problems of small corporations that may not have counsel and you can offer your services -21st century ambulance chasing

  4. This article clearly displays the issue associated with open desk working.

    I can’t imagine how you can ensure compliance with such open spaces with papers spread out with confidential information. The end of every day “open” filing on every desk.

    Anyone pick a file left “unattended” and a secret goes away.

    Good job!

  5. What a brilliant article! Richard, you got me laughing from ear to ear. While I am not holding brief for any co-working platform, it appears to be the order of the day with advantages including cost-saving for start-ups and smaller teams. With the millennials churning new ideas at the minute these days, co-working spaces appear to be the place to be for ideation to implementation to scaling. For example, in Accra, Ghana, where we have a presence, too, co-working spaces are on the up. My two cents on compliance: put your VPN on or use your own Wi-Fi device so your non-visual sensitive data doesn’t spirit away on the shared internet platform. On a lighter note, you do meet some great people doing greats things at some of these hubs. Great piece!

  6. Excellent article. Not even mentioning GDPR – Privacy and Date Protection!!!

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