SECURITIES AND 

EXCHANGE 

COMMISSION 

Improving Personnel 

Management Is 

Critical for Agency's 

Effectiveness 

Report to Congressional Committees

July 2013

GAO-13-621

United States Government Accountability Office
United States Government Accountability Office

Highlights of GAO-13-621, a report to 

congressional committees

July 2013

SECURITIES AND EXCHANGE COMMISSION

Improving Personnel Management Is Critical for 

Agency’s Effectiveness 

Why GAO Did This Study

Personnel management is important to 

the mission of federal agencies. 

Several high-profile enforcement 

failures have raised concerns about 

SEC’s personnel management. 

Section 962 of the Dodd-Frank Wall 

Street Reform and Consumer 

Protection Act mandates GAO to report 

on SEC's personnel management. This 

report examines (1) SEC’s 

organizational culture and (2) its 

personnel management challenges 

and efforts to address these 

challenges. 

GAO assessed SEC’s personnel 

management systems against OPM 

guidance and other criteria related to 

workforce planning and performance 

management (which includes 

appraisals and feedback); reviewed 

relevant reports; surveyed SEC 

employees and senior management 

(with 78 and 74 percent response 

rates, respectively) to gather their 

views on SEC’s organizational culture 

and personnel management practices; 

and spoke with former employees, the 

SEC Inspector General, 

representatives of the employees’

union, financial industry associations, 

consulting firms, and academics.

What GAO Recommends

GAO makes seven recommendations 

to improve SEC’s personnel 

management, including developing 

comprehensive workforce plans, 

implementing mechanisms to monitor 

how supervisors use the performance 

management system, conducting

periodic validations of the system,

exploring collaboration practices of 

leading organizations, and regularly 

assessing these efforts. SEC agreed 

with GAO’s recommendations.

What GAO Found

Based on analysis of views from Securities and Exchange Commission (SEC)

employees and previous studies from GAO, SEC, and third parties, GAO determined 

that SEC’s organizational culture is not constructive and could hinder its ability to 

effectively fulfill its mission. Organizations with constructive cultures are more 

effective and employees also exhibit a stronger commitment to mission focus. In 

describing SEC’s culture, many current and former SEC employees cited low morale, 

distrust of management, and the compartmentalized, hierarchical, and risk-averse 

nature of the organization. According to an Office of Personnel Management (OPM)

survey of federal employees, SEC currently ranks 19th

SEC has not consistently or fully implemented effective personnel management. SEC 

has taken some steps, but most of its efforts were in the early stages and could be 

enhanced. GAO identified four key areas where continued improvement is needed: 

of 22 similarly sized federal 

agencies based on employee satisfaction and commitment. GAO’s past work on 

managing for results indicates that an effective personnel management system will 

be critical for transforming SEC’s organizational culture. 

• Workforce planning. SEC has not yet developed a comprehensive workforce 

plan, including how it identifies its future leaders. Although SEC has taken some 

steps, such as identifying competency gaps and conducting leadership training,

these efforts do not reflect all elements of effective workforce planning outlined in 

OPM guidance. OPM guidance calls on agencies to develop and implement 

plans to identify workforce needs and develop future leaders. Without fully 

implementing such practices, SEC will not be able to make well-informed 

decisions on how to best meet current and future agency needs. 

• Performance management. SEC’s implementation of its performance 

management system could be improved. SEC staff expressed many concerns

about the system, such as an unclear link between their performance and 

ratings. SEC provided training to supervisors on how to use the system and 

obtained staff input on aspects of the system. However, SEC has not fully 

validated the system with its staff. Also, SEC does not have mechanisms in place 

to monitor supervisors’ use of the system. By not validating all aspects of the 

system and establishing mechanisms to hold supervisors accountable for 

appropriately using it, SEC is missing opportunities to enhance the credibility and 

effectiveness of its performance management system. 

• Communication and collaboration. SEC has made efforts to improve 

communication and collaboration (such as creating new subunits to facilitate joint

work), but has not yet fully addressed barriers. Moreover, these efforts have not 

yet addressed all of the problems that the Inspector General found contributed to 

past enforcement failures. GAO has reported on leading practices that SEC 

could explore, including sustained management attention. Improving 

communication and collaboration within SEC is critical to its effectiveness. 

• Personnel management assessment. SEC has not implemented an 

accountability system to monitor and evaluate its personnel management.

According to OPM guidance, such a system helps agencies assess whether 

personnel policies are effective. SEC officials explained that efforts were under

way to develop a system. Until such an accountability system is implemented, it 

will be difficult for SEC to make necessary improvements and help ensure that its 

personnel management policies and programs align with its mission.

View GAO-13-621. For more information, 

contact A. Nicole Clowers at (202) 512-8678 

or clowersa@gao.gov.
Page i GAO-13-621 SEC Personnel Management

Letter 1

Background 5

SEC’s Organizational Culture Hinders Agency’s Ability to 

Effectively Fulfill Its Mission 10

Improving Personnel Management Is Critical for SEC’s 

Effectiveness 17

Conclusions 40

Recommendations for Executive Action 42

Agency Comments 43

Appendix I Objectives, Scope, and Methodology 45

Appendix II GAO Survey on SEC Personnel and Human Capital 

Management 52

Survey Introduction 52

Survey Results of Nonsupervisors and Supervisors 54

Survey Results of Senior Officers 70

Appendix III Ratio of Staff to Supervisors and Senior Officers, Fiscal Years 

2008-2012 76

Appendix IV Percentage of Staff Who Left SEC, Fiscal Years 2008-2012 78

Appendix V Comments from the Securities and Exchange Commission 81

Appendix VI GAO Contact and Staff Acknowledgments 84

Tables

Table 1: Roles and Responsibilities of Selected SEC Divisions, as of 

April, 2013 7

Table 2: Survey Responses from SEC Employees about Morale, as 

of January-March 2013 11

Contents
Page ii GAO-13-621 SEC Personnel Management

Table 3: Survey Responses from SEC Employees about Trust, as of 

January-March 2013 12

Table 4: Survey Responses from SEC Employees about Having a 

Voice in Decision Making, as of January-March 2013 15

Table 5: Survey Responses from SEC Employees about Risk 

Aversion, as of January-March 2013 16

Table 6: Survey Responses from SEC Employees about Taking a 

Stand on Issues, as of January-March 2013 16

Table 7: Survey Responses from SEC Employees about Promotion 

to Management, as of January-March 2013 22

Table 8: Survey Responses from SEC Employees about Incentives 

for Promotion, as of January-March 2013 23

Table 9: Survey Responses from SEC Employees about Fairness 

and Appropriateness of Performance Appraisals, as of 

January-March 2013 25

Table 10: Survey Responses from SEC Employees about 

Performance and Recognition, as of January-March 2013 26

Table 11: Survey Responses from SEC Employees about Feedback 

from Direct Supervisors, as of January-March 2013 28

Table 12: Survey Responses from SEC Employees about How 

Senior Officers Dealt with Poorly Performing Supervisors, 

as of January-March 2013 30

Table 13: Survey Responses from SEC Employees about How 

Supervisors Dealt with Poorly Performing Staff, as of 

January-March 2013 31

Table 14: Survey Responses from SEC Employees about Flow of 

Relevant Information, as of January-March 2013 38

Table 15: Survey Responses from SEC Employees about Open 

Communication between Staff and Management, as of 

January-March 2013 38

Table 16: Ratio of Supervisors to Nonsupervisors (per every 100 

nonsupervisory staff), Fiscal Years 2008-2012 76

Table 17: Ratio of Senior Officers to Nonsupervisors (per every 100 

nonsupervisory staff), Fiscal Years 2008-2012 76

Table 18: Ratio of Senior Officers to Supervisors (per Every 100 

Supervisory Staff), Fiscal Years 2008-2012 77

Table 19: Headquarters Staff Who Left SEC, Fiscal Years 2008-2012 78

Table 20: Staff Who Left SEC from 11 Regional Offices, Fiscal 

Years 2008-2012 79

Table 21: All Staff Who Left SEC, Fiscal Years 2008-2012 80
Page iii GAO-13-621 SEC Personnel Management

Figure

Figure 1: Organizational Structure of SEC, as of September, 2012 6

Abbreviations

COO Office of the Chief Operating Officer

DERA Division of Economic and Risk Analysis

FAA Federal Aviation Administration

HCAAF Human Capital Assessment and Accountability Framework

IG Inspector General

NEP National Examination Program

OCIE Office of Compliance Inspections and Examinations

OHR Office of Human Resources

OPM Office of Personnel Management

SEC Securities and Exchange Commission

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Page 1 GAO-13-621 SEC Personnel Management

441 G St. N.W.

Washington, DC 20548

July 18, 2013

The Honorable Tim Johnson

Chairman

The Honorable Michael Crapo

Ranking Member

Committee on Banking, Housing, and Urban Affairs

United States Senate

The Honorable Jeb Hensarling

Chairman

The Honorable Maxine Waters

Ranking Member

Committee on Financial Services

House of Representatives

The Securities and Exchange Commission’s (SEC) mission is to protect 

investors; maintain fair, orderly, and efficient securities markets; and 

facilitate capital formation. To carry out its mission, SEC requires public 

companies to disclose meaningful financial and other information to the 

public, examines firms it regulates, and investigates potential securities 

law violations. Over the past decade, the markets, products, and 

participants that SEC oversees and regulates—including investment 

advisers, mutual and exchange-traded funds, and broker-dealers—have 

grown in size and complexity. Trading volume in the equity markets has 

more than doubled, as have assets under management by investment 

advisers.

As the markets grew in size and complexity over the past two decades, 

investors experienced large losses during the 2007-2009 financial crisis 

and through a few high-profile fraud cases, such as the failure of Bernard 

L. Madoff Investment Securities LLC. The financial crisis highlighted the 

interconnectedness and complexity of the growing financial markets as 

securitized assets amplified losses across multiple markets. The crisis 

also highlighted gaps and weaknesses in the supervision and regulation 

of financial markets. To address such concerns, Congress enacted the 

Dodd-Frank Wall Street Reform and Consumer Protection Act (the DoddFrank Act).1

 1

Pub. L. No. 111-203, 124 Stat. 1376 (2010).

Among other things, the act expands SEC’s regulatory 
Page 2 GAO-13-621 SEC Personnel Management

responsibilities, including increased oversight of hedge funds and 

derivatives. However, members of Congress and other stakeholders have 

questioned SEC’s ability to effectively protect investors in light of the 

growing complexity of the markets and past enforcement failures.

Effectively carrying out existing and new regulatory responsibilities 

requires that SEC attract and retain a high-quality workforce. However, 

we and others previously reported on the personnel management 

challenges SEC has faced in building and retaining such a workforce.2

These challenges included a lack of emphasis on personnel management 

and weaknesses in linking pay and performance. SEC is not unique in 

facing personnel management challenges. In 2001, we added strategic 

human capital management to our list of high-risk areas because of the 

long-standing lack of leadership on personnel matters across the 

government.3

Section 962 of the Dodd-Frank Act mandates us to examine SEC’s 

personnel management, including the competence of professional staff, 

the effectiveness of supervisors, and issues related to employee 

performance assessments, promotion, and intra-agency communication.4

 2

See GAO, Securities and Exchange Commission: Human Capital Challenges Require

Management Attention, GAO-01-947 (Washington, D.C.: Sept. 17, 2001); Securities and 

Exchange Commission: Human Capital Survey, GAO-05-118R (Washington, D.C.: Nov. 

10, 2004); Securities and Exchange Commission: Some Progress Made on Strategic 

Human Capital Management, GAO-06-86 (Washington, D.C.: Jan. 10, 2006); Financial 

Regulators: Agencies Have Implemented Key Performance Management Practices, but 

Opportunities for Improvement Exist, GAO-07-678 (Washington, D.C.: Jun. 18, 2007); and 

Securities and Exchange Commission: Greater Attention Needed to Enhance 

Communication and Utilization of Resources in the Division of Enforcement, GAO-09-358

(Washington, D.C.: Mar. 31, 2009). Also see SEC, Office of Inspector General, Report on 

Enforcement Performance Management, OIG-423 (Washington, D.C.: Feb. 8, 2007); 

Investigation of Failure of the SEC to Uncover Bernard Madoff’s Ponzi Scheme, public 

version, OIG-509 (Washington, D.C.: Aug. 31, 2009); Program Improvements Needed 

within the SEC’s Division of Enforcement, OIG-467 (Washington, D.C.: Sept. 29, 2009); 

Investigation of the SEC’s Response to Concerns Regarding Robert Allen Stanford’s 

Alleged Ponzi Scheme, public version,OIG-526 (Washington, D.C.: Mar. 31, 2010); and 

OCIE Regional Offices’ Referrals to Enforcement, public version, OIG-493 (Washington, 

D.C.: Mar. 30, 2011). See Boston Consulting Group, U.S. Securities and Exchange 

Commission: Organizational Study and Reform (Washington, D.C.: Mar. 2011); and 

Robert Tobias, Evaluation of the U.S. Securities and Exchange Commission’s Evidence 

Based Performance Management System (Washington, D.C.: June 1, 2012). 

3

For our most recent high-risk report, see GAO, High-Risk Series: An Update, 

GAO-13-283 (Washington, D.C.: Feb. 2013).

4

Pub. L. No. 111-203, § 962, 124 Stat. 1376, 1908-09 (2010).
Page 3 GAO-13-621 SEC Personnel Management

This report examines (1) what is known about SEC’s organizational 

culture and (2) SEC’s personnel management challenges and its efforts 

to address these challenges.5

To document SEC’s organizational culture and personnel management 

challenges, we reviewed management consultant reports, GAO reports, 

and SEC reports and testimonies. We also interviewed former SEC

officials, the SEC Inspector General (IG), SEC union representatives and 

members, management consultants, representatives from industry trade 

groups, and academics with knowledge of SEC personnel management 

issues. We examined SEC’s performance management policies, 

procedures, and activities by reviewing agency documents related to 

workforce and succession planning (such as recruitment and training 

practices), performance appraisals, supervision, promotion processes, 

and communication within and among divisions. We assessed the 

policies, procedures, and activities against applicable federal regulations, 

the Office of Personnel Management’s (OPM) Human Capital 

Assessment and Accountability Framework (HCAAF), key human capital 

practices and GAO standards for internal control, and SEC’s strategic 

plan.6

We also conducted semistructured one-on-one interviews, focus groups, 

and two web-based surveys to gather employee views on SEC’s 

organizational culture and the agency’s personnel management practices, 

 5

Organizational culture is the underlying assumptions, beliefs, values, attitudes, and 

expectations shared by an organization’s members that affect their behavior and the 

behavior of the organization as a whole.

6

Human Resources Management in Agencies, HCAAF and HCAAF Systems, Standards, 

and Metrics, 73 Fed. Reg. 23012, 23027 (Apr. 28, 2008) (codified at 5 C.F.R. § 250.202 

(2012)); GAO, Organizational Transformation: Implementing Chief Operating Officer/Chief 

Management Officer Positions in Federal Agencies, GAO-08-34 (Washington, D.C.: Nov. 

1, 2007); Human Capital: Key Principles for Effective Workforce Planning, GAO-04-39

(Washington, D.C.: Dec. 11, 2003); Results-Oriented Cultures: Modern Performance 

Management Systems Are Needed to Effectively Support Pay for Performance, 

GAO-03-612T (Washington, D.C.: Apr. 1, 2003); Human Capital: DOD Needs to Improve 

Implementation of and Address Employee Concerns about its National Security Personnel 

System, GAO-08-773 (Washington, D.C.: Sept. 10, 2008); Results-Oriented Government: 

Practices That Can Help Enhance and Sustain Collaboration among Federal Agencies, 

GAO-06-15 (Washington, D.C.: Oct. 21, 2005); Managing Key Results: Key 

Considerations for Implementing Interagency Collaborative Mechanisms, GAO-12-1022

(Washington, D.C.: Sept. 27, 2012); and Standards for Internal Control in the Federal 

Government, AIMD-00-21.3.1 (Washington, D.C.: Nov. 1999).
Page 4 GAO-13-621 SEC Personnel Management

including areas where SEC has been doing well and areas in which there 

are challenges. The scope of these efforts included employees in the five 

divisions and one office (hereinafter, divisions) in SEC primarily 

responsible for implementing the agency’s mission—Divisions of 

Corporation Finance; Enforcement; Investment Management; Economic 

and Risk Analysis; Trading and Markets; and the Office of Compliance 

Inspections and Examinations (OCIE).7 In these divisions, we focused on 

employees in four occupational categories—accountants, attorneys, 

examiners, and financial analysts—that account for the majority of SEC 

employees. We held one-on-one interviews with 129 nonsupervisory staff, 

supervisors, and senior officers at SEC headquarters and regional offices 

from July to September 2012.8 All employees in the relevant divisions and 

occupational categories were invited to participate in the interviews. We 

held 22 focus groups at headquarters and four regional offices with 

nonsupervisory staff and supervisors in the divisions and occupational 

categories within our scope. We selected the regional offices based on 

factors including enforcement activity, geographic location, and staff size, 

and randomly selected staff and supervisors from the relevant divisions 

for our focus groups. We also implemented two web-based surveys of all 

2,439 employees (nonsupervisory staff and supervisory) and 86 senior 

officers in these divisions that fall within the four occupation groups.9

 7

On June 6, 2013, SEC renamed the Division of Risk, Strategy, and Financial Innovation 

to the Division of Economic and Risk Analysis (DERA).

The 

survey response rates were 78 and 74 percent, respectively. We do not 

make any attempt to extrapolate the findings to the 22 percent of eligible 

staff who chose not to complete our survey. We reviewed OPM’s 2012 

Federal Employee Viewpoint Survey Results to obtain additional 

perspectives from SEC staff on the agency’s personnel management8

For the purposes of our surveys, (1) nonsupervisory staff are employees in SEC’s pay 

plan grades SK 12-16 for the Division of Enforcement, and SK 12, 13, 14, and 16 for the 

remaining four divisions and OCIE; (2) supervisors are employees in SEC’s pay plan 

grades SK 17 for the Division of Enforcement, and SK 15 and 17 for the other divisions 

and OCIE; and (3) senior officers are employees in SEC’s pay plan grades SO 1-3. See 

the background section of this report for more information on the organizational structure 

of SEC.

9

According to SEC data, this figure captures the number of staff who were employed as of 

September 30, 2012. 
Page 5 GAO-13-621 SEC Personnel Management

related issues.10

We conducted this performance audit from March 2012 to July 2013 in 

accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain 

sufficient and appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.

Appendix I includes more information on our scope and 

methodology.

SEC is composed of a five-member Commission that oversees SEC 

operations and provides final approval over staff interpretation of federal 

securities laws, proposals for new or amended rules to govern securities 

markets, and enforcement activities. The Commission, which is headed 

by the SEC chairman, oversees 5 divisions and 23 offices, including 11 

regional offices. Figure 1 further depicts SEC’s organizational structure.

 10OPM’s Federal Employee Viewpoint Survey is a tool that measures employees’

perceptions of whether, and to what extent, conditions characterizing successful 

organizations are present in their agencies. Survey results provide valuable insight into 

the challenges agency leaders face in ensuring the government has an effective civilian 

workforce and how well they are responding. The 2012 Federal Employee Viewpoint 

Survey included employees from 82 agencies (constituting 97 percent of executive branch 

agencies).

Background
Page 6 GAO-13-621 SEC Personnel Management

Figure 1: Organizational Structure of SEC, as of September, 2012

a

On June 6, 2013, SEC renamed the Division of Risk, Strategy, and Financial Innovation to the 

Division of Economic and Risk Analysis.

SEC’s divisions are organized by functional responsibility. For example, 

SEC’s responsibilities for reviewing corporate disclosures are housed 

within the Division of Corporation Finance. Table 1 summarizes the roles 

and responsibilities of the six divisions that primarily implement SEC’s 

mission. These divisions are supported by other offices, such as the 

Office of Financial Management and the Office of Human Resources 

(OHR). In particular, OHR provides overall responsibility for the strategic 

management of SEC’s personnel management and assesses compliance 

with federal regulations for areas such as recruitment, retention, 

leadership and staff development, and performance management. OHR 
Page 7 GAO-13-621 SEC Personnel Management

reports to SEC’s Office of the Chief Operating Officer (COO), which in 

turn reports to the Commission.

Table 1: Roles and Responsibilities of Selected SEC Divisions, as of April 2013

Division Roles and responsibilities

Division of Corporation Finance Reviews corporate disclosures, assists companies in interpreting SEC’s rules, and 

recommends new rules for adoption.

Division of Enforcement Investigates possible violations of securities laws, recommends Commission action when 

appropriate, either in a federal court or before an administrative law judge, and 

negotiates settlements.

Division of Investment Management Regulates investment companies (such as mutual, closed-end, and exchange-traded 

funds), some insurance products, and federally registered investment advisers. 

Division of Economic and

Risk Analysisa

Serves as SEC’s “think tank” on economic issues. Associated with the entire range of 

SEC activities, including policymaking, rule making, enforcement, and examination. The 

division also assists in SEC’s efforts to identify, analyze, and respond to risks and trends, 

including those associated with new financial products and strategies.

Division of Trading and Markets Establishes and maintains standards for fair, orderly, and efficient markets. The division 

regulates major securities market participants, including the securities exchanges, 

broker-dealers, self-regulatory organizations, and transfer agents (parties that maintain 

records of stock and bond owners).

Office of Compliance Inspections 

and Examinations

Administers examination and inspection program of the registered entities, including 

broker-dealers, transfer agents, investment advisers, investment companies, national 

securities exchanges, clearing agencies, self-regulatory organizations, and the Public 

Company Accounting Oversight Board. 

Source: SEC.

a

On June 6, 2013, SEC renamed the Division of Risk, Strategy, and Financial Innovation to the 

Division of Economic and Risk Analysis.

To carry out its mission, SEC employs staff with a range of skills and 

backgrounds, such as attorneys, accountants, and economists. As of 

September 30, 2012, SEC employed 3,829 staff. Of these staff, 

approximately 43 percent were attorneys, 26 percent were accountants or 

financial analysts, and 4 percent were examiners. The remaining 27 

percent were other professional, technical, administrative, and clerical 

staff. To help SEC attract and retain qualified employees, Congress 

enacted the Investor and Capital Markets Fee Relief Act (Pay Parity Act) 

in 2002 that allowed SEC to implement a new compensation system with 

unique pay scales comparable to those of other federal financial 
Page 8 GAO-13-621 SEC Personnel Management

regulators.11 SEC staff are represented by the National Treasury 

Employees Union (hereafter, the SEC employees’ union).

SEC’s performance management system, also known as the EvidenceBased Performance Management System, includes individual 

development plans for all employees, a performance appraisal rating 

system, a feedback process, and a process for supervisors to deal with 

poor performance. The current performance appraisal system has criteria 

by which all SEC employees are rated in relation to work objectives and 

competency-based performance standards, such as critical thinking and 

teamwork. Staff are rated on the objectives and standards on a scale of 

1-5.12 SEC calculates an overall rating for each employee by averaging 

their ratings for the objectives and standards.13 As designed, employees’

ratings eventually would be used to calculate the employee’s pay-forperformance. SEC developed this system in 2010 and continues to 

negotiate aspects of the design and implementation of its current 

performance management system with the SEC employees’ union.14 For 

example, to date SEC has not instituted the pay-for-performance aspect 

of the system for nonsupervisory, bargaining unit staff because of 

ongoing negotiations.

 11Pub. L. No. 107-123, § 8, 115 Stat. 2390, 2397-99 (2002). 

12Under SEC’s system, a rating of 5 is defined as greatly exceeds expectations, 4 

exceeds expectations, 3 meets expectations, 2 needs improvement, and 1 is 

unacceptable.

13There are slight differences in how ratings are calculated for employees covered by the 

bargaining and those not covered by the unit. For bargaining unit employees, scores for 

objectives have more weight than the scores for standards when the overall average 

scores are calculated. For nonbargaining unit employees, the objectives and standards 

scores are weighed equally when calculating the overall rating.

14On October 19, 2006, the Federal Services Impasse Panel ruled on Case No. 06 FSIP 

54, In the Matter of SEC and the National Treasury Employees Union (the SEC 

employees’ union). Several provisions in the panel decision related to SEC’s performance 

management system, including a redesign of the system to include five levels of ratings. In 

response to the panel decision, SEC developed and implemented the Evidence-Based 

Performance Management System. 

SEC’s Performance 

Management System
Page 9 GAO-13-621 SEC Personnel Management

OPM advocates the use of HCAAF, which is a set of tools and strategies 

available to federal agencies that assist officials in achieving results in 

personnel management programs.15

• Strategic alignment. Agency strategies for human capital 

management are aligned with mission, goals, and organizational 

objectives and are integrated into its strategic plan and performance 

budget. 

HCAAF guides the assessment of 

agency efforts, while allowing enough flexibility for agencies to tailor these 

efforts to their missions, plans, and budgets. The framework uses five 

standards for success, lists key questions to consider, and suggests 

performance indicators for measuring progress and results. The five 

standards for success are as follows:

• Leadership and knowledge management. Agency leaders and 

managers effectively manage people, ensure continuity of leadership, 

sustain a learning environment that drives continuous improvement in 

performance, and provide a means to share critical knowledge across 

the organization.

• Results-oriented performance culture. The agency has a diverse, 

results-oriented, high-performing workforce and a performance 

management system that effectively differentiates between high and 

low levels of performance and links individual/team/unit performance 

to organizational goals and desired results.

• Talent management. The agency has closed gaps or deficiencies in 

skills, knowledge, and competencies for mission-critical occupations, 

and made meaningful progress toward closing such gaps or 

deficiencies in all occupations used in the agency. 

• Accountability. A data-driven, results-oriented planning and 

accountability system guides the agency’s decisions on human capital 

management. 

OPM has been providing some updates to the HCAAF model to federal 

agencies; however, OPM officials with whom we spoke stated that 

agencies would continue operating under the current HCAAF model until 

the end of fiscal year 2013 because the updated version has not been 

fully implemented. They noted that the updates to HCAAF reinforce 

existing content and streamline the systems to make HCAAF more 

 15Human Resources Management in Agencies, HCAAF and HCAAF Systems, Standards, 

and Metrics, 73 Fed. Reg. 23012, 23027 (Apr. 28, 2008) (codified at 5 C.F.R. § 250.202 

(2012)).

OPM’s Human Capital 

Assessment and 

Accountability Framework
Page 10 GAO-13-621 SEC Personnel Management

practical to use. The updated version of HCAAF, called the Human 

Capital Framework, reduces the number of systems from five to four 

(strategic alignment, talent management, performance culture, and 

evaluation).

Based on our analysis of the views of many SEC employees, our 

previously issued reports on SEC, and recent studies from SEC and third 

parties, we have determined that the agency’s organizational culture is 

not constructive and could hinder its ability to effectively fulfill its mission. 

Organizations with more constructive cultures generally perform better 

and are more effective. Within constructive cultures, employees also 

exhibit a stronger commitment to mission focus, accountability, 

coordination, and adaptability.16

SEC’s culture reflects low employee morale. More than half of 

nonsupervisory staff and about 43 percent of supervisory staff disagreed 

that employee morale is generally high most of the time. About a quarter 

of senior officers had the same view (see table 2). We also found that 

44.7 percent of nonsupervisory staff and 30 percent of supervisors did not 

agree that management has taken steps to improve employee morale.

In describing the agency’s culture, many 

current and four former SEC employees talked about low levels of 

employee morale, employees’ distrust of management, and the 

compartmentalized, hierarchical, and risk-averse nature of the 

organization. These views are consistent with our past work as well as 

the work of others.

 16In a previous report, we focused on determining whether the Federal Aviation 

Administration’s (FAA) culture affected its acquisitions. For the analysis, we drew 

extensively on studies by FAA and other organizations, surveyed FAA employees, and 

reviewed studies on organizational change and culture in the public and private sectors. In 

describing criteria for organizational culture, we noted that research has shown that in 

organizations with a more constructive culture, employees exhibit a stronger commitment 

to (1) mission focus (pursuing goals that define the best course of action for an 

organization); (2) accountability (empowering employees and holding them responsible for 

their decisions and actions); (3) coordination (involving other employees in decisions 

affecting them, resolving differences collaboratively, and cooperating across 

organizational lines); and (4) adaptability (accepting new approaches and responding 

positively to demands and opportunities posed from within and outside of the 

organization). We found FAA’s acquisitions were impaired because employees acted in 

ways that did not reflect a strong commitment to mission focus, accountability, 

coordination, and adaptability. See GAO, Aviation Acquisition: A Comprehensive Strategy 

Is Needed for Cultural Change at FAA, GAO/RCED-96-159 (Washington, D.C.: Aug. 22, 

1996).

SEC’s Organizational 

Culture Hinders 

Agency’s Ability to 

Effectively Fulfill 

Its Mission
Page 11 GAO-13-621 SEC Personnel Management

Table 2: Survey Responses from SEC Employees about Morale, as of January-March 2013

Survey statement: Employee morale is generally high most of the time.

Response category Nonsupervisory staff Supervisory staff Senior officers 

Strongly agree/somewhat agree 29.8% 38.2% 54.7%

Neither agree or disagree 14.5 18.2 20.3 

Strongly disagree/somewhat disagree 54.1 42.6 25.0

Do not know 1.2 0.8 0.0

No response checked 0.4 0.3 0.0

Total

(number of respondents)

100

(1,462)

100

(390)

100

(64)

Source: GAO.

Note: Percentages may not always add to 100 due to rounding.

According to a number of staff who provided written survey comments, 

morale is low for various reasons, ranging from lack of effective 

leadership and communication to dissatisfaction with the performance 

management system and opportunities for promotion. Furthermore, many 

staff who participated in our one-on-one interviews commented that the 

implementation of the five-point performance rating scale resulted in 

arbitrary ratings and that they perceived favoritism in promotions. Many 

other staff commented that staff morale was low. These sentiments were 

similar to our past findings. For example, we reported in 2001 that SEC 

had not created an organizational culture that ensured ongoing attention 

to personnel management issues and that SEC staff did not think the 

agency sufficiently valued and motivated staff.17 Our findings in this report 

are also consistent with the Partnership for Public Service’s analysis of 

OPM’s 2012 Employee Viewpoint Survey.18

 17

The analysis found that 

SEC’s overall index score—which measures staff’s general satisfaction 

GAO-01-947.

18First issued in 2003, the Partnership for Public Service uses data from OPM’s Federal 

Employee Viewpoint Survey to rank agencies and their subcomponents according to a 

Best Places to Work index score. The 2012 rankings draw on responses from nearly 

700,000 civil servants to produce a detailed view of employee satisfaction and 

commitment across 362 federal agencies and subcomponents. Agencies and 

subcomponents not only are measured on overall employee satisfaction, but are scored in 

10 workplace categories, such as effective leadership, employee skills/mission match, 

pay, teamwork, and work/life balance.
Page 12 GAO-13-621 SEC Personnel Management

and commitment—declined from 73.1 in 2007 to 56 in 2012.19

SEC’s culture reflects an atmosphere of distrust. When asked 

whether there is an atmosphere of trust at SEC, many staff disagreed. As 

shown in table 3, 40 percent of nonsupervisory staff and about 30 percent 

of supervisory staff thought there was a lack of trust. About 17 percent of 

senior officers voiced this viewpoint.

Compared 

with other midsize agencies, SEC ranked 19 of 22 in overall satisfaction 

and commitment. The decrease in morale among staff may negatively 

affect their productivity and commitment to the agency’s mission.

Table 3: Survey Responses from SEC Employees about Trust, as of January-March 2013

Survey statement: There is an atmosphere of trust in my office/office.

Response category Nonsupervisory staff Supervisory staff Senior officers

Strongly agree/somewhat agree 45.1% 59.0% 73.4%

Neither agree or disagree 13.4 10.5 7.8

Strongly disagree/somewhat disagree 40.0 30.3 17.2

Do not know 1.1 0.3 1.6

No response checked 0.4 0 0

Total

(number of respondents)

100

(1,462)

100

(390)

100

(64)

Source: GAO.

Note: Percentages may not always add to 100 due to rounding.

Survey respondents offered explanations for the lack of trust. From their 

written comments on SEC’s organizational culture, lack of trust was 

among the more frequently mentioned topics. For example, one survey 

respondent indicated that the atmosphere of distrust was due to a lack of 

direct communication with and knowledge sharing from managers. Based 

on comments from several respondents, the adverse working relationship 

between the union and management may have contributed to the level of 

distrust between staff and upper management by constantly assuming the 

worst in senior managers’ initiatives and other actions. The lack of trust 

 19According to the Partnership for Public Service analysis, the government-wide 

satisfaction and commitment score in 2012 has dropped to the lowest point since rankings 

were first published in 2003. The declining job satisfaction levels across the federal 

government come during turbulent times, with employees feeling the effects of a 2- and 

1/2 year pay freeze, hiring slowdowns, and budget constraints.
Page 13 GAO-13-621 SEC Personnel Management

may undermine the working relationships between management and 

staff.

SEC’s culture is compartmentalized. Many current and three former 

staff described SEC’s culture as “siloed”—that is, work is 

compartmentalized in each division and little communication, 

collaboration, or movement occurs between the divisions. Despite recent 

SEC efforts to improve intra-agency communication that we discuss later 

in this report, issues remain. According to our survey, at least one-third of 

nonsupervisory staff and supervisors said that in the past 12 months, they 

had not contacted staff in other divisions (except for Enforcement) in the 

home office for work-related issues, such as coordinating activities or 

asking for expert advice.20 Further, about 21 percent of nonsupervisory 

staff said that communication between other divisions on work-related 

matters is not encouraged.21 Others have identified similar issues. For 

example, a 2009 SEC IG report found that the Division of Enforcement 

did not always seek assistance from other offices and divisions as 

needed during its investigation of the Madoff Ponzi scheme; consequently 

Enforcement staff had difficulty understanding key aspects of Madoff’s 

fraud.22

 20Of the staff and supervisors who responded to our survey, 32 percent had not contacted 

employees in the division of Corporation Finance, 40 percent had not contacted 

employees in Investment Management, 37 percent had not contacted employees in 

Trading and Markets, and 50 percent had not contacted employees in Economic and Risk 

Analysis. SEC employees contacted the Division of Enforcement more frequently, with 19 

percent of the respondents saying that they had not contacted Enforcement. SEC officials 

explained that there are many projects for which communication across divisions might 

not be necessary, and that this is partly why a sizable percentage of employees had not 

contacted employees in other divisions. 

Similarly, a 2011 SEC IG report found that the level of 

communication between OCIE and Enforcement after a referral—that is,

noteworthy information from an OCIE examination passed on to 

Enforcement for further investigation or action—was not always

21According to results from OPM’s 2012 Federal Employee Viewpoint Survey, which 

surveyed employees from 82 federal agencies (constituting 97 percent of executive 

branch agencies), 53.3 percent of employees responding to the survey provided a positive 

response (agree or strongly agree) to the statement that managers promote 

communication among different work units, about 23.0 percent provided a neutral 

response (neither agree nor disagree), and 23.8 percent provided a negative response 

(disagree or strongly disagree).

22OIG-467.
Page 14 GAO-13-621 SEC Personnel Management

consistent in the regional offices, which can hinder SEC’s ability to 

achieve its mission.23

In addition, the 2011 Boston Consulting Group’s report also noted that 

SEC’s culture impaired communication and collaboration between 

divisions. Each division’s internal structure was tailored to divisionspecific needs, and SEC historically placed limited emphasis on using 

formalized mechanisms for cross-divisional collaboration.24

SEC’s culture is hierarchical. Many current staff and two former SEC 

officials described the agency’s culture as hierarchical. Close to 42 

percent of nonsupervisory staff did not agree that they had a voice in 

decisions that affected them and their work environment (see table 4). 

One former SEC director told us that although nonsupervisory and lowerlevel supervisory staff might have the most knowledge of a particular 

matter, they did not speak out very much because staff are not 

encouraged to challenge ideas or challenge more senior-level staff.

Furthermore, 

according to three former SEC officials, managers generally have not 

encouraged staff to move between divisions and work in different areas. 

The former officials told us that managers did not encourage staff to move 

around because they were afraid to lose a staff slot in their division. One 

former official explained that staff often were reluctant to discuss their 

desire to rotate among divisions because such interest might be 

misinterpreted as a desire to leave SEC. A compartmentalized 

environment could result in missed opportunities for leveraging 

knowledge and skills of staff across the divisions and may have 

contributed to past enforcement failures.

 23See OIG-493. According to SEC officials, SEC has addressed the recommendation in 

this report and now has committees for discussing referrals. 

24See Boston Consulting Group, U.S. Securities and Exchange Commission: 

Organizational Study and Reform. 
Page 15 GAO-13-621 SEC Personnel Management

Table 4: Survey Responses from SEC Employees about Having a Voice in Decision Making, as of January-March 2013

Survey statement: I have a voice in decisions that affect me and my work environment.

Response category Nonsupervisory staff Supervisory staff Senior officers

Strongly agree/somewhat agree 38.3% 63.1% 92.2%

Neither agree or disagree 17.9 12.1 4.7

Strongly disagree/somewhat disagree 41.8 23.6 1.6

Do not know 1.3 0.0 0.0

No response checked 0.8 1.3 1.6

Total

(number of respondents)

100

(1,462)

100

(390)

100

(64)

Source: GAO.

Note: Percentages may not always add to 100 due to rounding.

The 2011 Boston Consulting Group report also stated that, while good 

communication existed at the most senior level, information did not 

always travel down as effectively as it should. Such hierarchical culture 

may discourage open communication and innovation because staff may 

be reluctant to speak up and share ideas.

SEC culture is risk averse. Many current staff and two former officials 

described SEC’s culture as risk averse, and some also noted that 

aversion to risk has grown in recent years. In our survey of SEC 

employees, more than half of staff (supervisory and nonsupervisory) and 

more than 62 percent of senior officers agreed that the fear of public 

scandals may have contributed to the culture of risk aversion at SEC (see 

table 5). For example, a few senior officers and staff surveyed remarked 

that recent enforcement failures and related, sustained criticism from 

members of Congress, SEC’s former Inspector General, and the public 

has contributed to their unwillingness to take risks and innovate.
Page 16 GAO-13-621 SEC Personnel Management

Table 5: Survey Responses from SEC Employees about Risk Aversion, as of January-March 2013

Survey statement: Fear of public scandals has made SEC overly cautious and risk-averse.

Response category Nonsupervisory staff Supervisory staff Senior officers

Strongly agree/somewhat agree 54.5% 57.4% 62.5%

Neither agree or disagree 16.7 14.6 12.5

Strongly disagree/somewhat disagree 21.0 24.6 25.0

Do not know 7.5 2.3 0.0

No response checked 0.3 1.3 0.0

Total

(number of respondents)

100

(1,462)

100

(390)

100

(64)

Source: GAO.

Note: Percentages may not always add to 100 due to rounding.

Furthermore, close to half of the staff (both nonsupervisory and 

supervisory) agreed that the fear of being wrong has made some senior 

officers reluctant to take a stand on important issues (see table 6). Many 

current SEC staff we surveyed and two former SEC officials indicated that 

added layers of review—which have been added because of this fear, 

according to staff—not only decreased efficiency but also slowed decision 

making.

Table 6: Survey Responses from SEC Employees about Taking a Stand on Issues, as of January-March 2013

Survey statement: The fear of being wrong makes senior officers in my division/office reluctant to take a stand on important issues.

Response category Nonsupervisory staff Supervisory staff Senior officers

Strongly agree/somewhat agree 46.6% 44.1% 21.9%

Neither agree or disagree 15.1 13.6 12.5

Strongly disagree/somewhat disagree 26.6 38.5 62.5

Do not know 10.9 3.6 3.1

No response checked 0.8 0.3 0.0

Total

(number of respondents)

100

(1,462)

100

(390)

100

(64)

Source: GAO.

Note: Percentages may not always add to 100 due to rounding.

A number of staff who responded to our survey provided specific 

instances of risk aversion. For instance, according to a few survey 

respondents, managers have been afraid to close cases or make 

decisions because senior officers want to minimize the chances that they 
Page 17 GAO-13-621 SEC Personnel Management

would be criticized later. Another survey respondent added that, due to 

such risk aversion, cases that address evolving market practices or 

developments with little precedent may not be pursued.

We and others have previously reported similar results. In 2009, we found 

that Enforcement’s internal system for case review slowed cases, created 

an atmosphere of fear and insecurity, and may have created incentives 

for staff to drop cases or narrow the scope of a review.25 Similarly, in 

2010, the SEC IG reported that the desire for Enforcement staff to avoid 

difficult cases was partly due to challenges in dealing with the agency’s 

bureaucracy. According to a former SEC senior officer, the arduous 

process of obtaining approval to recommend an enforcement action by 

SEC headquarters was a factor in deciding which investigations to 

pursue. The IG also noted there appeared to be an increased focus on 

easier, “slam dunk” cases over those cases that looked to be complex 

and more time consuming.26

As it takes years for an organization’s culture to take hold, it also may 

take years to effect changes to that culture. Such change requires 

sustained efforts by senior management to address challenges related to 

organizational culture. We found that for organizations to successfully 

transform themselves, they often must change their culture 

fundamentally. An effective personnel management system is critical to 

achieving this cultural transformation.

As a result, the cases chosen for 

investigations may not have effectively identified potential securities 

violations.

SEC has not consistently or fully implemented practices for effective 

personnel management practices. Specifically, we found deficiencies or

limitations in the areas of workforce and succession planning, 

performance appraisals and incentives, and communication and 

collaboration. SEC has taken some steps to address aspects of these 

deficiencies or limitations, but most of the agency’s efforts are in the early 

stages and could be enhanced. Prioritizing and enhancing personnel 

management efforts are critical for SEC’s ability to achieve its mission 

and goals. Moreover, sustained leadership and attention in these efforts 

 25GAO-09-358.

26OIG-526.

Improving Personnel 

Management Is 

Critical for SEC’s 

Effectiveness
Page 18 GAO-13-621 SEC Personnel Management

from SEC’s COO could help the agency overcome the natural resistance 

to change, marshal the resources needed to implement change, and build 

and maintain an organization-wide commitment to new ways of doing 

business.27

SEC has not yet developed a comprehensive workforce plan. A workforce 

plan encompasses systematic processes for identifying and addressing 

the gaps between current and future workforce needs. According to OPM 

guidance, effective workforce plans align workforce requirements with 

agency strategic plans, develop a comprehensive picture of gaps in 

competencies and future requirements, and inform decision making about 

how best to structure the organization and deploy the workforce. For 

example, a workforce plan could provide SEC management information 

on the types, number, and location of supervisory and nonsupervisory 

staff. A plan could also help management determine the type of training 

and other strategies needed to close gaps, while taking into consideration 

factors including the ratio of management to staff, industry trends, 

workforce diversity, and projections of retirements.28 Moreover, according 

to OPM guidance, succession planning forms an integral part of 

workforce planning and helps ensure an ongoing supply of qualified staff 

to fill leadership and other key positions.29

 27Based on information gathered from officials at four organizations with COO-type 

positions and a forum with individuals with experience in business transformation, we 

reported in November 2007 that a senior-level position, such as a COO, can provide 

sustained management attention essential for addressing key stewardship responsibilities 

in an integrated manner while helping to facilitate the business transformation process 

within an agency. Responsibilities under a COO could include, among others, strategic 

planning, communications and information resources management, human capital 

strategy, and change management. See 

In September 2012, we 

concluded that such a plan is essential for helping ensure that SEC has 

GAO-08-34.

28Section 962 of Dodd Frank Act required us to review the ratio of management to staff, 

including whether there are “excessive” numbers of low-level, mid-level, or senior-level 

managers. Pub. L. No. 111-203, § 962(b)(1)(G), 124 Stat. 1376, 1909 (2010). Appendix III 

provides additional information on the ratio of management to staff from 2008 to 2012. In 

addition, the act required us to review turnover rates within SEC subunits. § 962(b)(1)(F). 

While staff turnover rates could be used to identify potential areas for improvement and 

further develop current supervisors, officials from the Merit Systems Protection Board 

noted that turnover was not a good indicator of poor supervision for several reasons. See 

appendix IV for more information.

29See OPM, Workforce Planning Model.

SEC Lacks Comprehensive 

Plans to Help Ensure 

Its Workforce Has the 

Necessary Skills
Page 19 GAO-13-621 SEC Personnel Management

the right mix of talent, skills, and experience to execute its mission and 

goals.30

Key principles for effective workforce planning from our past work also 

has shown that it is important for agencies to ensure that their strategic 

workforce planning efforts (1) involve top management, staff, and other 

stakeholders; (2) identify the critical skills and competencies that will be 

needed to achieve current and future programmatic results, including 

evaluation of gaps; (3) develop strategies that are tailored to address 

skills gaps; (4) build the internal capability needed to address

administrative, training, and other requirements important to support 

workforce planning strategies; and (5) include plans to monitor and 

evaluate the agency’s progress toward meeting its human capital goals.31

These findings are consistent with OPM guidance.32

Although SEC has not yet developed a comprehensive workforce plan, 

SEC’s OHR has been actively working to do so.33 In response to the 

Boston Consulting Group report, OHR began to identify competency 

gaps, which is an important step in workforce planning.34

 30GAO, Human Capital Management: Effectively Implementing Reforms and Closing 

Critical Skill Gaps Are Key to Addressing Federal Workforce Challenges, 

In late 2011, 

OHR completed a workforce profile that provided a snapshot of current 

workforce composition (including information on the number and types of 

mission-critical occupations, education, tenure, and supervisory status) to 

better understand current workload gaps and workforce availability 

among divisions and offices. SEC’s OHR also began working with the 

divisions to identify skill gaps. To further assess competency gaps, in 

October 2012 OHR sent each division and office questionnaires to 

determine what new functions existed and the number of positions 

needed to undertake those functions. In April 2013, SEC hired a staff 

member with expertise in workforce planning who is to focus on workforce 

planning efforts. The planner is to integrate workforce data and help SEC 

GAO-12-1023T

(Washington, D.C.: Sept. 19, 2012). 

31GAO, Human Capital: Key Principles for Effective Workforce Planning, GAO-04-39

(Washington, D.C.: Dec. 11, 2003).

32See OPM, Workforce Planning Model.

33 We first recommended that SEC develop such a plan in 2001. See GAO-01-947.

34See Boston Consulting Group, Organizational Study and Reform. 
Page 20 GAO-13-621 SEC Personnel Management

effectively carry out remaining workforce planning goals. In May 2013, 

SEC also hired a staff member with expertise in succession planning.35

SEC also has initiated strategies, such as hiring and training, to close 

skills gaps. For example, SEC’S OHR began working with the divisions to 

hire staff with necessary specialized and financial industry expertise. 

Many SEC staff with whom we spoke in one-on-one interviews indicated 

that the recent actions SEC has taken helped address issues related to 

the competence of staff across the agency. For example, our survey 

showed that 86 percent of nonsupervisory staff and supervisors indicated 

that their division was able to attract talented and qualified staff. 

Additionally, the majority of nonsupervisory staff, supervisors, and senior 

officers who responded to our survey indicated the training they received 

provided them with the right skills to meet SEC’s needs. Furthermore, 

participants in about half of our 22 focus groups said that training 

opportunities had increased and improved in quality. Similarly, one 

industry representatives with whom we spoke also told us that SEC staff 

generally had the right set of skills to carry out SEC’s mission effectively.

SEC has also expanded developmental opportunities for staff. For 

instance, SEC has increased technical and developmental opportunities 

for nonsupervisory staff by offering leadership development courses 

through SEC University.36

 35As of May 2013, OHR officials told us that, in addition to acquiring a workforce and a 

succession planner, they also revised the responsibilities of an existing staff member to 

support workforce and succession planning efforts.

While all supervisors can take the core 

leadership courses, selected courses are made available for 

nonsupervisory staff to promote career development to a managerial 

position. SEC also has offered other tools, including a 360 degree 

36SEC University is part of OHR and consists of three colleges. The Leadership 

Development College focuses on leadership and offers classes to all SEC employees. 

SEC University collaborates with the divisions and offices to conduct training needs 

assessments and develop training plans to address the identified needs. 
Page 21 GAO-13-621 SEC Personnel Management

feedback program and executive coaching service to support the 

development of SEC’s supervisors.37

While SEC has taken steps towards identifying and addressing its 

workforce competency gaps, these efforts have not reflected all of the 

elements of effective workforce planning and strategies articulated in 

OPM guidance. During our review, OHR officials told us that the agency 

has not conducted a thorough analysis of its workforce to 

comprehensively identify competency gaps, including those related to the 

right mix of staff to supervisors. Without a comprehensive approach to 

identify these gaps, any strategies to address them will not be fully 

effective. As indicated in our survey, more than 50 percent of 

nonsupervisory staff and supervisors responded that management in their 

divisions could do more to address skill gaps. Moreover, some SEC staff 

and supervisors have raised questions about the appropriateness of the 

ratio of staff to managers. For instance, SEC nonsupervisory and 

supervisory staff with whom we spoke in the focus groups and those we 

surveyed expressed varying views on the ratio of staff to managers; some 

thought it was appropriate, others thought there were too many 

managers. When we asked SEC’s OHR how they determined an 

appropriate ratio, they told us that it is dependent on the complexity of the 

program or activity. Historically, each division took the lead in making 

those types of decisions, as well as decisions related to hiring and 

identifying training needs.

Additionally, SEC has not developed a comprehensive management 

succession program to fill agency supervisory positions, contrary to 

regulatory requirements.38 Specifically, it lacks a transparent process for 

leadership succession, including how it identifies and grooms highpotential leaders, as outlined in OPM guidance and federal regulations.39

 37The 360 assessment tool supports leadership effectiveness by targeting areas for 

continued development. Through feedback from superiors, peers, and subordinates, the 

tool generates a comprehensive evaluation of leadership effectiveness across 24 

competencies, including managing conflict, leveraging differences, decisiveness, and 

strategic planning. “Iconnect,” implemented in late 2011, is SEC’s mentoring program that 

offers professional networking and career development opportunities to nonsupervisory 

staff. 

38OPM Succession Planning Rule, 5 C.F.R. § 412.201 (2012).

39Human Resources Management in Agencies, HCAAF and HCAAF Systems, Standards, 

and Metrics, 73 Fed. Reg. 23012, 23027 (Apr. 28, 2008) (codified at 5 C.F.R. § 250.202 

(2012)).
Page 22 GAO-13-621 SEC Personnel Management

Staff also perceived the promotion process as unfair. The development of 

a succession plan might help address pronounced staff dissatisfaction 

with the promotion process. For example, a more transparent process 

could enable staff to have a better understanding of how high-potential 

leaders from within the agency are identified and make the promotion 

process appear less unfair. While SEC has written selection criteria for 

promotion, several nonsupervisory staff with whom we spoke in one-onone interviews and whom we surveyed viewed SEC’s methods for 

promoting individuals to supervisory positions as unclear and potentially 

biased. Almost 55 percent of nonsupervisory staff responded that 

promotion to management was mostly based on connections that staff 

had with management (see table 7). In addition, participants in 7 of our 22 

focus groups said that it was unclear how certain individuals were 

selected for promotion. We found similarities between SEC employee 

viewpoints and those of employees at other federal agencies. For 

example, according to OPM’s 2012 Federal Employee Viewpoint Survey, 

which surveyed employees from 82 federal agencies, comprising 97 

percent of the agencies in the executive branch, 33.5 percent of 

government employees responding to the survey agreed (or strongly 

agreed) that promotions in their work unit were based on merit, about 

29.2 percent neither agreed nor disagreed, and 37.3 percent disagreed 

(or strongly disagreed).

Table 7: Survey Responses from SEC Employees about Promotion to Management, 

as of January-March 2013

Survey statement: Promotion to management is mostly based on the connection that 

staff have with management.

Response category

a

Nonsupervisory 

staff

Supervisory 

staff

Strongly agree/somewhat agree 54.9% 35.6%

Neither agree or disagree 14.6 19.2

Strongly disagree/somewhat disagree 12.4 39.5

Do not know 17.6 4.9

No response checked 0.6 0.8

Total

(number of respondents)

100

(1,462)

100

(390)

Source: GAO.

a

Note: Percentages may not always add to 100 due to rounding.

This question was not included in the survey to senior officers.
Page 23 GAO-13-621 SEC Personnel Management

Additionally, many staff we surveyed and with whom we spoke in one-onone interviews also did not think there was much incentive to be 

promoted into management positions. For example, slightly more than 

half of nonsupervisory staff and almost 75 percent of supervisors who 

responded to our survey indicated that there was not much incentive to 

be promoted because the salary increase would be minimal (see table 8). 

Staff in 7 of the 22 groups said staff had little incentive to become 

managers because the differences in pay were minimal. Similarly, 1 in 10 

staff with whom we met individually said there were no financial 

incentives to apply for a promotion to the first-level supervisor position. 

Senior officers had mixed views about the incentives for promotion. 

According to OHR officials, the pay differential (traditionally, 6 percent) 

between nonmanagers and managers has been eroded and in some 

cases eliminated. Because of the federal pay freeze, while nonmanagers 

have received merit increases every year, managers have not received 

any increases.

Table 8: Survey Responses from SEC Employees about Incentives for Promotion, as of January-March 2013

Survey statement: There is not much incentive to get promoted into a management position because the salary increase is minimal.

Response category Nonsupervisory staff Supervisory staff Senior officers

Strongly agree/somewhat agree 51.6% 74.1% 42.2%

Neither agree or disagree 16.8 6.7 10.9

Strongly disagree/somewhat disagree 20.3 17.2 42.2

Do not know 10.9 1.3 3.1

No response checked 0.3 0.8 1.6

Total

(number of respondents)

100

(1,462)

100

(390)

100

(63)

Source: GAO.

Note: Percentages may not always add to 100 due to rounding.

Until SEC completes a comprehensive workforce plan, the agency will be 

limited in its ability to meet its workforce needs. According to agency 

officials, SEC has been slow to adopt comprehensive workforce planning 

because human capital planning has not been considered an area of high 

priority. OHR officials explained that SEC priorities were concentrated on 

mission-critical functions and, as such, OHR focused on fulfilling and 

complying with essential OPM reporting requirements because of 

resource constraints. Additionally, OHR officials noted that, prior to the 

recent release of SEC’s first human capital strategic plan in 2012, human 

capital efforts generally were loosely put together and not formally linked 

to SEC’s overall strategic plan. Our previous work has shown that 
Page 24 GAO-13-621 SEC Personnel Management

sustained leadership attention by the COO or other officials will be 

important to address these concerns.40 Without comprehensive workforce 

and succession plans, SEC will be limited in its ability to make wellinformed decisions about how to best meet agency needs today and into 

the future.

The design of SEC’s performance management system reflects some 

characteristics of an effective system but could be improved. According to 

OPM guidance (primarily HCAAF) and our past work, an effective 

performance management system typically encompasses expectations 

that are set for staff, monitoring of staff’s work that results in performance 

appraisals, feedback to staff on their performance and ways to improve it, 

and recognition of staff’s contributions.41

• performance appraisals that distinguish between levels of 

performance and reward strong performance,

More specifically, effective 

performance management systems include:

• meaningful and timely feedback discussions,

• actions to address poor performance,

• mechanisms to ensure supervisors properly use the system, and

• periodic staff validation of the system to ensure its credibility.

SEC’s performance management system includes an appraisal system 

that consists of ratings designed to differentiate between levels of 

performance. The performance management system also requires 

supervisors and senior officers to use performance results to offer 

feedback, identify developmental needs, and address instances of poor 

performance. The system also includes steps and actions to address poor 

performance.

However, our work, as well as outside studies, suggests that SEC’s 

implementation of its performance management system could be 

 40 GAO-08-34.

41In addition to HCAAF, see OPM, A Handbook for Measuring Employee Performance, 

(Washington, D.C.: September 2011). For a list of internal safeguards key to successful 

implementation of performance management systems that we have previously identified, 

see GAO, Human Capital: DOD Needs to Improve Implementation of and Address 

Employee Concerns about its National Security Personnel System, GAO-08-773

(Washington, D.C.: Sept. 10, 2008).

Implementation of SEC’s 

Performance Management 

System Could Be Improved
Page 25 GAO-13-621 SEC Personnel Management

improved. SEC staff expressed many concerns about the implementation 

of the performance management system. For example, staff expressed 

concerns about the link between their performance and ratings, limited 

performance incentives, unconstructive feedback, and the extent of 

actions taken to address poor performance. SEC senior officers 

expressed concerns about the system as well. By not addressing these 

implementation concerns, the agency could face challenges in retaining a 

high-quality workforce that is actively engaged in the work of SEC, which 

in turn, could affect the agency’s ability to adequately carry out its 

mission.

According to HCAAF, an effective performance management system 

distinguishes between levels of performance and rewards strong 

performance. Although the design of SEC’s performance appraisal 

system reflects these elements, SEC staff raised a number of concerns 

related to how the appraisal system is applied, and the link between their 

performance and incentives (that is, pay and rewards). Our survey results

revealed that about 43 percent of nonsupervisory staff did not believe 

their performance appraisals are fair and appropriate (see table 9). 

Similarly, participants in the majority of the focus groups we conducted 

with nonsupervisory staff stated that their ratings were arbitrary and not 

meaningful, and that their ratings under the current appraisal system did 

not fully reflect their accomplishments. In contrast, most supervisors and 

senior officers that responded to our survey indicated that they thought 

staff performance appraisals were fair and appropriate.

Table 9: Survey Responses from SEC Employees about Fairness and Appropriateness of Performance Appraisals, as of 

January-March 2013

Survey statement: Employee performance appraisals are fair and appropriate under SEC’s performance management system.

Response category Nonsupervisory staff Supervisory staff Senior officers

Strongly agree/somewhat agree 20.1% 51.8% 70.3%

Neither agree or disagree 21.0 18.5 17.2

Strongly disagree/somewhat disagree 42.8 26.9 10.9

Do not know 14.8 1.5 0

No response checked 1.2 1.3 1.6

Total

(number of respondents)

100

(1,462)

100

(390)

100

(64)

Source: GAO.

Note: Percentages may not always add to 100 due to rounding.

Performance Appraisal 

System and Incentives
Page 26 GAO-13-621 SEC Personnel Management

A 2012 study of SEC’s performance management system, conducted by 

an independent third party, found similar results.42

Staff also raised concerns about whether the system, as implemented, 

rewarded strong performance. A little more than one-third of 

nonsupervisory SEC staff who responded to our survey indicated that 

there was a clear link between their performance and recognition of it; 

about the same amount said that a clear link did not exist (see table 10).

Specifically, almost 

half of the nonsupervisory staff that responded to that study’s survey 

indicated that their appraisal rating did not accurately reflect their 

performance. We compared SEC employee viewpoints from our survey to 

those of employees at other federal agencies and identified differences. 

According to OPM’s 2012 Federal Employee Viewpoint Survey, about 16 

percent of employees government-wide responding to the survey 

disagreed (or strongly disagreed) that their performance appraisal was a 

fair reflection of their performance.

Table 10: Survey Responses from SEC Employees about Performance and Recognition, as of January-March 2013

Survey statement: There is a clear link between my performance and recognition of it.

Response category Nonsupervisory staff Supervisory staff Senior officers

Strongly agree/somewhat agree 37.6% 60.5% 59.4%

Neither agree or disagree 17.4 14.1 20.3

Strongly disagree/somewhat disagree 38.6 24.6 18.8

Do not know 5.5 0 0

No response checked 1.0 0.8 1.6

Total

(number of respondents)

100

(1,462)

100

(390)

100

(64)

Source: GAO.

Note: Percentages may not always add to 100 due to rounding.

 42 In March 2011, SEC and the SEC employees’ union agreed to have an independent, 

third party conduct a study of the application of the performance management system for 

fiscal year 2011, which was completed in 2012. See, Robert Tobias, Evaluation of the 

U.S. Securities and Exchange Commission’s Evidence Based Performance Management 

System (Washington, D.C.: June 1, 2012). The Tobias study included a survey made 

available to all SEC employees and advertised in the SEC Today newsletter. The survey 

received 1,387 responses (77 percent bargaining unit; 11 percent nonbargaining 

unit/nonsupervisory; and 13 percent management/supervisory). This equated to a 

response rate of approximately 39 percent.
Page 27 GAO-13-621 SEC Personnel Management

We also heard concerns related to the link between performance and pay 

from staff in our focus groups. According to nonsupervisory and 

supervisory staff in 17 of the 22 focus groups we conducted, the 

performance appraisal process was not meaningful, as bargaining unit 

staff who received an acceptable rating received the same pay increase 

(measured in percentage) regardless of the rating score. OHR officials 

acknowledged that all bargaining unit staff across SEC that received an 

acceptable rating received the same pay increase (percentage) during 

fiscal year 2012. According to these officials, SEC has not been able to 

implement the pay-for-performance element of the system because 

negotiations with the employees’ union remain ongoing. Such across-theboard pay increases weaken the link between pay and performance. In 

contrast, SEC has put in place pay-for-performance for supervisors and 

senior officers. Most supervisors (almost 61 percent) and senior officers 

(almost 60 percent) who responded to our survey said a clear link existed 

between their performance and recognition of it.

Staff also expressed concerns with the awards process. SEC has an 

awards program that is designed to recognize employee contributions 

above and beyond normal job requirements and provide monetary and 

nonmonetary awards.43

 43SEC has a separate awards program, albeit limited due to budget constraints, for strong 

performance. The program is designed to motivate employees and recognize 

contributions above and beyond normal job requirements, and includes monetary and 

nonmonetary awards. SEC’s Office of Human Resources (OHR) is responsible for 

monitoring and evaluating documentation for award recommendations, and the use of 

approval authority for awards that OHR delegated to divisions.

However, more than 60 percent of 

nonsupervisory staff and about 43 percent of supervisory staff who 

responded to our survey indicated that they did not think the criteria for 

rewarding staff were clearly defined. In addition, staff in the majority of 

nonsupervisory focus groups we conducted asserted that the awards 

process was not transparent. For example, staff told us that it was unclear 

what was required to receive an award for strong performance and why 

some staff received awards and others did not. Senior officers with whom 

we spoke in one division had similar perspectives and stated that the 

criteria and tasks associated with different levels of awards were not 

sufficiently transparent. In some of the focus groups we conducted, SEC 

staff also told us that the awards themselves, partly due to budget 

constraints, were not particularly meaningful. Some supervisors also 

commented that they had few means to motivate staff.
Page 28 GAO-13-621 SEC Personnel Management

According to OPM guidance, an effective performance management 

system requires and encourages meaningful feedback discussions.

Moreover, it states that meaningful feedback provides opportunities for 

supervisors to offer specific details on staff’s performance and 

suggestions on how staff can improve certain aspects of his/her 

performance. SEC requires supervisors and managers to conduct a 

formal feedback meeting at the end of the performance cycle and to 

provide feedback to each of their staff on their performance that is 

specific, descriptive, and objective. SEC also encourages supervisors and 

managers to solicit questions from staff during performance feedback 

session.

The majority of SEC nonsupervisory and supervisory staff are generally 

satisfied with the feedback they received. According to our survey of 

nonsupervisory and supervisory staff, the majority of respondents 

indicated that they received useful feedback from their direct supervisors 

(see table 11).

Table 11: Survey Responses from SEC Employees about Feedback from Direct 

Supervisors, as of January-March 2013

Survey statement: My direct supervisor provides useful and constructive feedback.

Response category

a

Nonsupervisory 

staff 

Supervisory

staff 

Strongly agree/somewhat agree 65.3% 70.5%

Neither agree or disagree 11.9 9.5

Strongly disagree/somewhat disagree 20.1 16.7

Do not know 1.0 1.0

No response checked 1.6 2.3

Total

(number of respondents)

100

(1,462)

100

(390)

Source: GAO.

a

Note: Percentages may not always add to 100 due to rounding.

This question was not included in the survey to senior officers.

However, some nonsupervisory staff raised concerns about the quality of 

the feedback they received. About 20 percent of nonsupervisory staff that 

responded to our survey indicated that they did not receive useful or 

constructive feedback. Among these respondents, some commented that 

the feedback was vague or did not provide specific suggestions for 

improvement. Similarly, some staff in our focus groups said that they did 

not receive meaningful feedback. We found similarities between SEC 

Feedback
Page 29 GAO-13-621 SEC Personnel Management

employee viewpoints and those of employees at other federal agencies.44

However, in the 2012 third-party study, nearly half of SEC employees 

who completed the survey indicated that they had not received 

meaningful feedback from their supervisors, and the study found that 

about a quarter of the respondents did not indicate that they had a formal 

feedback session during the annual rating period when the survey was 

conducted.45

SEC has taken steps to address some staff’s concerns about feedback.

For example, SEC has provided training to supervisors on how to provide 

clear performance expectations and effectively counsel staff on their 

performance. However, implementing mechanisms to monitor 

supervisors’ efforts to provide meaningful feedback could provide SEC 

with greater assurance that its supervisors are providing feedback to staff 

as intended and that staff have the information to maintain or adjust their 

performance accordingly.

In focus groups and interviews we conducted with 

nonsupervisory and supervisory staff, timeliness was generally not 

identified as an issue related to feedback.

OPM guidance states that an effective performance management system 

outlines actions that supervisors should take to address staff performance 

and, in particular, staff who are not meeting performance expectations.

Such actions are important because they attempt to rectify poor 

performance that could be affecting an agency’s ability to achieve its 

mission or goals. SEC’s system includes a process to address poor 

performing staff. Specifically, those who receive an overall rating of 

unacceptable are placed on a performance improvement plan that 

requires them to meet certain goals to demonstrate improvement. To 

complete the improvement plan, staff must maintain the improved level of 

performance for the duration of the plan. If staff do not improve and 

 44According to results from OPM’s 2012 Federal Employee Viewpoint Survey, which 

surveyed employees from 82 federal agencies (comprising 97 percent of executive branch 

agencies), about 61 percent of employees responding to the survey agreed (or strongly 

agreed) that their supervisors or team leaders provided constructive suggestions to 

improve their job performance, about 21 percent neither agreed nor disagreed, and about 

19 percent disagreed (or strongly disagreed). Percentages do not add up to 100 due to 

rounding.

45Tobias, Evaluation of the U.S. Securities and Exchange Commission’s Evidence Based 

Performance Management System.

Actions to Address 

Staff Performance
Page 30 GAO-13-621 SEC Personnel Management

sustain performance at an acceptable level during the duration of the 

plan, SEC can demote or dismiss the staff.

Although SEC’s performance management system includes such 

elements, employees reported concerns about how SEC addressed poor 

performing supervisors and staff.

• Poor performing supervisors. According to the results from our 

survey, staff generally do not think SEC senior officers or supervisors 

effectively deal with poor performers. About 56 percent of the 

nonsupervisory staff and about 47 percent of supervisory staff who 

responded to our survey indicated that senior officers do not deal 

effectively with poor performing supervisors (see table 12). Similarly, 

in about one-third of our focus groups, nonsupervisory staff and 

supervisors both stated that SEC generally had not taken actions 

against poor supervisors. In contrast, a little more than half of the 

senior officers who responded to our survey reported that they dealt 

effectively with poor-performing supervisors.

Table 12: Survey Responses from SEC Employees about How Senior Officers Dealt with Poorly Performing Supervisors, as of 

January-March 2013

Survey statement: Overall, senior officers deal effectively with poor-performing supervisors and managers.

Response category Nonsupervisory staff Supervisory staff Senior officers

Strongly agree/somewhat agree 5.3% 24.9% 56.3%

Neither agree or disagree 9.9 15.1 17.2

Strongly disagree/somewhat disagree 56.2 46.7 23.4

Do not know 28.4 13.3 3.1

No response checked 0.1 0 0

Total

(number of respondents)

100

(1,462)

100

(390)

100

(64)

Source: GAO.

Note: Percentages may not always add to 100 due to rounding.

• Poor performing staff. More than 50 percent of both nonsupervisory 

staff and supervisors who responded to our survey indicated that 

supervisors did not deal effectively with poorly performing staff (see 

table 13). Some supervisors commented that dealing with poorperforming staff often is very time-consuming. Similarly, according to 

results from OPM’s 2012 Federal Employee Viewpoint Survey, 43 

percent of employees government-wide responding to the survey 

disagreed (or strongly disagreed) that in their work unit, steps were 
Page 31 GAO-13-621 SEC Personnel Management

taken to deal with a poor performer who could not or would not 

improve.

Table 13: Survey Responses from SEC Employees about How Supervisors Dealt 

with Poorly Performing Staff, as of January-March 2013

Survey statement: Overall, supervisors and managers deal effectively with poorperforming staff.

Response category

a

Nonsupervisory 

staff 

Supervisory 

staff 

Strongly agree/somewhat agree 9.6% 28.5%

Neither agree or disagree 12.4 12.8

Strongly disagree/somewhat disagree 51.1 55.1

Do not know 26.6 3.1

No response checked 0.3 0.5

Total

(number of respondents)

100

(1,462)

100

(390)

Source: GAO.

a

This question was not included in the survey to senior officers.

When we spoke to OHR officials about how SEC has dealt with poor 

performing staff, they told us that actions taken against poor performing 

staff are confidential and, as a result, SEC staff may not be aware of how 

poor performance has been addressed. According to OHR officials, from 

2007 through June 2013, SEC placed 38 staff under performance 

improvement plans. Subsequently, 2 staff were terminated, 10 resigned, 3 

were reassigned within SEC, 18 successfully completed the improvement 

plan, 1 has a proposed removal pending, and 4 are still in the 

performance improvement plan period as of June 2013.46

According to OPM guidance, an effective performance management 

system monitors how supervisors use the system and provide feedback 

to staff, includes performance standards for supervisors in these areas, 

and requires that supervisors’ performance in these areas be part of their 

 46During the same period, SEC took one adverse action (which is separate from the 

improvement plan process and can include unpaid suspension, demotion, or removal) 

against an employee for poor performance. The adverse action resulted in the resignation 

of the employee in lieu of termination. Regarding actions taken against poor performing 

employees, we do not have similar information for other federal agencies so we could not 

determine how SEC’s removal rates compare to those of other federal agencies. 

Mechanisms to Monitor 

Supervisors’ Use of 

the Performance 

Management System
Page 32 GAO-13-621 SEC Personnel Management

feedback and performance evaluations. Without such mechanisms, it is 

more difficult to ensure accountability in how aspects of the performance 

management system are applied, especially the performance appraisal 

process whereby supervisors assess a subordinate’s performance, 

develop a corresponding rating, recognize their performance, and deliver 

feedback to the subordinate about his or her performance.

While SEC has performance standards related to supervisors’ use of the 

performance management system, we did not identify specific 

mechanisms for how SEC monitors supervisors’ use of the system. For 

example, while staff have the option to prepare written narratives on how 

they assess their own performance for that rating period, we did not 

identify mechanisms that monitor how supervisors use information from 

staff narratives to help ensure they prepare complete and accurate 

appraisal ratings for staff. Senior officers in the six divisions told us they 

reviewed narratives that supervisors wrote to support a subordinate’s 

rating for the purpose of ensuring that the narrative supported the rating.

However, this only serves to ensure that the narrative supports a rating, 

and not that the rating itself is an accurate representation of the 

subordinate’s performance. For example, consistent with OPM guidance, 

senior officers could assess how well supervisors monitor and assess 

staff performance by comparing the summaries that staff prepare 

assessing their own work against the ratings that supervisors prepare for 

these staff. Moreover, we found that some supervisors with whom we 

spoke have had limited discussions with their own supervisors about how 

they use the system to recognize and reward strong staff performance, 

provide feedback to staff, or take actions to deal with poor performance.

Without such mechanisms, there is an increased risk that accountability 

for performance appraisal processes and activities—such as developing 

ratings and delivering feedback—will be diminished. Mechanisms that 

monitor how the system is being applied and used by supervisors, such 

as ongoing feedback conversations between supervisors and their 

superiors, could help ensure that staff are receiving appraisals that reflect 

all of their performance during the rating period, are being provided 

meaningful feedback, and that poor performance is addressed in a timely 

and effective manner. Sustained management attention would help 

encourage the development of such mechanisms.
Page 33 GAO-13-621 SEC Personnel Management

We previously concluded that an effective performance management 

system includes periodic validation of the system to help ensure its 

credibility.47

SEC has taken some steps to obtain staff input on a portion of its 

performance management system. Specifically, SEC sought staff input on 

the creation of the performance standards for various occupations, 

including attorneys and examiners. However, managers validated and 

finalized these performance standards. Furthermore, we could not identify 

additional SEC efforts to obtain staff input on other aspects of its 

performance management system, such as the performance appraisal 

process. The safeguards that we previously identified are key to 

successful implementation of performance management systems in the 

federal government. We identified these safeguards based on our work 

looking at the performance management practices used by leading public 

sector organizations in the United States and in other countries, as well 

as our experiences in implementing a modern performance management 

system for our own staff at GAO. Among these safeguards, we’ve stated 

that it is vital for agencies to directly involve staff in the implementation of 

all aspects of a performance management system. According to OHR 

officials, they plan to validate the performance management system once 

SEC and the union reach agreement on the revisions currently being 

negotiated, but it is unclear when they will reach agreement since they 

have been in negotiations for several years. Validating the performance 

management system with staff input on aspects beyond performance 

standards and objectives could help enhance the credibility of SEC’s 

performance management system among its staff, including the ratings, 

recognition, or feedback that they receive as a result.

Validating the system typically refers to obtaining staff input 

and general agreement on the competencies, rating procedures, and 

other aspects of the system.

Although SEC has improved intra-agency communication and 

collaboration, barriers still exist. As discussed previously in this report, 

current and former SEC staff and others use words like “siloed 

communication” and “hierarchical” to describe SEC’s culture. Such an 

environment can hinder SEC’s ability to effectively carry out its mission by 

limiting communication and collaboration among the divisions. For 

 47GAO-08-773. 

Validation of System

SEC Has Yet to Fully 

Address Barriers to 

Communication and 

Collaboration
Page 34 GAO-13-621 SEC Personnel Management

example, as noted earlier in this report, SEC’s IG has reported on how 

this lack of communication and collaboration may have contributed to 

past enforcement failures.

According to HCAAF, supervisors and managers should foster an 

environment of open communication. Such communication, as found in 

our previous work, can facilitate a collaborative environment, enable more 

efficient work processes, and prevent misunderstandings. Open and 

effective communication occurs when information flows down, across, 

and up the organization. Frequent communication among collaborating 

divisions within an agency provides a means by which to facilitate working 

across intra-agency boundaries.48

SEC has taken some steps to address its communication challenges and 

enhance collaboration within and among divisions.

In prior work, we identified practices 

that can help to enhance and sustain collaboration among federal 

agencies, which can help to maximize performance and results, and have 

recommended that agencies follow them. These collaborative practices 

include identifying common outcomes, establishing joint strategies, 

leveraging resources, determining roles and responsibilities, and 

developing compatible policies and procedures, among others.

• Enforcement created national specialized units to focus its 

investigations on high-priority areas such as asset management, 

market abuse, and structured and new products in August 2009. The 

specialized units work with OCIE and other divisions to identify highrisk areas for further examination and investigation. Over the last 

year, Enforcement also has taken steps to improve headquarters 

interactions, including developing guidelines for the role of trial 

counsel in investigations and investigative staff in litigated matters. 

The division also formed an advisory committee, which according to 

SEC officials includes supervisors and managers, to identify broader 

cultural or structural reforms to improve coordination.

 48We reviewed program areas among select federal agencies that have demonstrated a 

sustained effort to collaborate within and among agencies and identified key principles 

that they consistently applied, such as, frequent communication to facilitate working 

across agency and office boundaries. GAO, Results-Oriented Government: Practices That 

Can Help Enhance and Sustain Collaboration among Federal Agencies, GAO-06-15

(Washington, D.C.: Oct. 21, 2005); and Managing For Results: Key Considerations for 

Implementing Interagency Collaborative Mechanisms, GAO-12-1022 (Washington, D.C.: 

Sept. 27, 2012).
Page 35 GAO-13-621 SEC Personnel Management

• OCIE created the National Examination Program (NEP) in 2010 to 

emphasize intra-agency collaboration and increase communication 

among different regional offices and divisions. OCIE established a 

standardized set of policies and procedures for conducting 

examinations under NEP to enhance coordinated examination and 

inspection activities. OCIE also established regular monthly national 

teleconferences of examiners across regions and headquarters, 

developed new processes for communicating with Enforcement about 

new and pending examination referrals, and set mutual goals with 

other divisions.

• Several divisions also created new offices or subunits to help facilitate 

communication and collaboration with other divisions. For example, 

according to SEC officials, OCIE, Enforcement, and Investment 

Management hired new communication managers in fiscal year 2013 

to develop more robust internal communication within their programs.

• In January 2013, SEC’s Office of Public Affairs established a crossdivisional internal communications working group to help ensure that 

appropriate attention is given to internal communication within the 

agency.

Both SEC staff and external stakeholders have started to see some 

positive effects from the recent efforts to bolster communication and 

collaboration. For example, when asked whether communication between 

divisions on work-related matters was encouraged, about 54 percent of 

nonsupervisory staff, 75 percent of supervisors, and 94 percent of senior 

officers strongly or somewhat agreed that such communication was 

encouraged. When asked about the effects of these recent efforts, 

specifically those that senior officers were making to improve 

communication and collaboration between divisions, many staff viewed 

these efforts as positive. For example, nonsupervisory staff (38 percent) 

and many supervisors (62 percent) thought that senior officers were 

making a moderate to great effort to improve collaboration among 

divisions.49

 49Our survey results are generally consistent with OPM’s 2012 Federal Employee 

Viewpoint Survey of federal agencies, in which slightly more than half of employees 

government-wide responding to the survey agreed (or strongly agreed) that managers 

supported collaboration and communication across units.

Representatives from one of the industry groups with whom 

we spoke said recent improvements in coordination across SEC’s 

regional offices has reduced the duplicative efforts that in the past 

incurred unnecessary time and money. The representatives also noted 
Page 36 GAO-13-621 SEC Personnel Management

that in meetings with SEC, multiple SEC divisions often have been 

represented.

Although the agency has taken efforts to improve its intra-agency 

communication and collaboration, staff continued to identify barriers to 

effective communication and collaboration among the divisions, within 

divisions, and between staff and management, contrary to collaborative 

best practices. For example, many nonsupervisory staff and supervisors 

who responded to our survey commented on communication issues and 

challenges, such as that they were frustrated that relevant and timely 

information was not freely communicated across units because of the 

need to obtain management approval to share such information. Rather 

than leveraging resources, according to some staff, various divisions 

function as individual “fiefdoms.” Former senior SEC officials with whom 

we spoke individually explained that some supervisors and senior officers 

felt the need to protect their “turf” and status in the agency by not sharing 

information. Furthermore, representatives from SEC’s union told us that 

management frowned on communication across divisions without going 

through formal channels. As noted earlier, about one-third of the SEC 

staff who responded to our survey said they had not contacted staff in 

other divisions (outside of Enforcement) over the last year on workrelated matters, such as coordinating activities or seeking expert advice. 

But, according to senior officers with whom we spoke from multiple 

divisions, cross-division communication and collaboration may not be 

necessary in many instances. They told us that staff involved in 

rulemaking are concentrated in a relatively small group of individuals, and 

staff in similar specialized roles may have fewer work-related 

opportunities or reasons to reach out across the agency for expertise or 

to coordinate work.

SEC staff also said barriers to communication and collaboration among 

offices in the same division exist. For example, they identified working 

relationships between investigative and trial attorneys in headquarters as 

a challenge. Senior officers in Enforcement told us in an interview that 

investigative attorneys in headquarters end their involvement in a matter 

once they complete their investigation and hand it off to the trial unit for 

prosecution. Further, the two units report to different supervisors and are 

located in different physical spaces, leading to inefficiencies due to a lack 

of continuity and collaboration, which are essential when building and 

prosecuting cases. For example, a trial attorney told us that there are 

times when the evidence that the investigative attorneys produce is not 

sufficient to successfully try a case and as a result they either have to 

gather additional evidence, or they choose not to pursue the case and 
Page 37 GAO-13-621 SEC Personnel Management

waste the past efforts of the investigators. This process is inconsistent 

with best practices related to intra-agency collaboration—such as 

identifying joint strategies designed to help align different division and 

subdivision activities and resources with the aim of achieving a common 

outcome. In contrast, investigative and trial attorneys in the regional 

offices work together collaboratively throughout the investigation and trial 

phases. Both units report to the same supervisor and are co-located.

According to staff, reporting to the same supervisor and being co-located 

helps the attorneys to stay in constant communication and collaborate 

from the beginning to the end of a case, facilitating their work.

Concerns were also raised about the nature of communication between 

managers and staff. Nonsupervisory staff were divided about whether 

supervisors included staff in the flow of relevant information, but the 

majority of supervisors thought they effectively included staff in the flow of 

information (see table 14). Many nonsupervisory staff and supervisors 

who responded to our survey commented that they were frustrated that 

relevant and timely information was not freely communicated among 

higher- and lower-level staff. For instance, several commented that the 

downward flow of information was nearly nonexistent or filtered, while 

upward flow (particularly staff suggestions to management) was not 

encouraged.50 Some nonsupervisory staff with whom we spoke 

characterized this as senior officers and supervisors “controlling” the flow 

of information.

 50Two hundred and fifty-eight of 2,439 SEC staff responded to our open-ended questions 

in the section on communication. Of those who provided written comments, the top three 

response categories were communication between divisions/offices (39.5 percent), 

communication within divisions/offices (21.7 percent), and communication that is 

hierarchical (top to bottom) or not free flowing (13.2 percent).
Page 38 GAO-13-621 SEC Personnel Management

Table 14: Survey Responses from SEC Employees about Flow of Relevant 

Information, as of January-March 2013

Survey statement: Supervisors and managers ensure that employees are included in 

the flow of relevant information.

Response category

a

Nonsupervisory 

staff 

Supervisory 

staff 

Strongly agree/somewhat agree 47.7% 73.1%

Neither agree or disagree 11.6 7.9

Strongly disagree/somewhat disagree 39.0 19.0

Do not know 1.3 0

No response checked 0.3 0

Total

(number of respondents)

100

(1,462)

100

(390)

Source: GAO.

a

Note: Percentages may not always add to 100 due to rounding.

This question was not included in the survey to senior officers.

Staff views again were divided about support for two-way communication. 

As shown in table 15, about half of the nonsupervisory and supervisory 

staff indicated their divisions supported open and two-way communication 

between staff and management. Roughly one-third of staff indicated that 

their divisions did not support such communication. During our review, we 

did not identify any steps that SEC has taken to systematically address 

challenges associated with two-way communication between staff and 

management.

Table 15: Survey Responses from SEC Employees about Open Communication between Staff and Management, as of 

January-March 2013

Survey statement: My division/office supports open, two-way communication between staff and management.

Response category Nonsupervisory staff Supervisory staff Senior officers

Strongly agree/somewhat agree 49.5 55.1 93.8

Neither agree or disagree 13.5 14.1 4.7

Strongly disagree/somewhat disagree 35.4 29.0 1.6

Do not know 0.9 0.5 0

No response checked 0.6 1.3 0

Total

(number of respondents)

100

(1,462)

100

(390)

100

(64)

Source: GAO.

Note: Percentages may not always add to 100 due to rounding.
Page 39 GAO-13-621 SEC Personnel Management

Despite recent efforts to break down silos, we found that they continue to 

exist, and communication between staff and management still tends to be 

top-down. Such an environment can hinder SEC’s ability to effectively 

carry out its mission by limiting communication and leading collaboration 

practices. Without a sustained management focus on implementing 

leading communication and collaboration practices, SEC continues to 

face increased risks of inefficiencies and less-than-optimal decision 

making about its market oversight, investigative, and enforcement 

functions. SEC can also foster and encourage more communication and 

collaboration among its staff by, for example, setting formal expectations 

for its supervisors to foster an environment of communication and 

collaboration, as well as recognizing exceptional teamwork, which it 

currently does not. These efforts would be consistent with OPM guidance 

in recognizing and rewarding an environment of teamwork.51

SEC has not developed an accountability system to monitor and evaluate 

its personnel management programs and systems (such as its workforce 

and succession planning functions and performance appraisal system). 

According to HCAAF, an accountability system is intended to evaluate 

results and provide consistent means for an agency to monitor and 

analyze its performance on all aspects of human capital management 

policies, programs, and systems.

The accountability system also contributes to an agency’s performance 

by identifying and monitoring necessary improvements. The 

accountability system should provide for annual assessments of an 

agency’s progress and results related to human capital management. The 

results should inform an agency’s human capital goals and objectives, in 

conjunction with strategic planning and performance budgets. Moreover, 

OPM officials also explained that the accountability system is an integral 

part of an evaluation system that OPM uses to determine how well 

agencies are monitoring and evaluating their human capital activities and 

programs.

According to OHR officials, human capital functions at SEC had not been 

a priority until 2009. As a result, limited resources had been allocated to 

 51Capital Assessment and Accountability Framework (HCAAF) and HCAAF Systems, 

Standards, and Metrics, 73 Fed. Reg. 23012, 23029 (Apr. 28, 2008) (codified at 5 C.F.R. § 

250.202 (2012)).

SEC Has Not Developed a 

System to Monitor and 

Evaluate Its Personnel 

Management Activities
Page 40 GAO-13-621 SEC Personnel Management

human capital functions, such as the development of an accountability 

system. However, SEC’s OHR officials said they have been developing 

such a system, and noted that implementing this comprehensive system 

would be a multiyear project. However, during our audit, OHR officials did 

not provide us with any specific documentation on the development of the 

system, how it will be implemented, and what steps will be taken to 

ensure its completion. In commenting on a draft of this report, SEC stated 

that they have recently developed milestones and deliverables for the 

implementation of the system, which SEC anticipates will be fully 

implemented by the end of this calendar year. Until a system is put into 

place, SEC may be missing opportunities to take a more comprehensive 

approach to improving its personnel management. Moreover, without the 

information such a system generates, it will be difficult for SEC to identify 

systemic problems related to its personnel management or to correct 

them.

Maintaining a top-notch, high-performing workforce is critical to SEC 

effectively carrying out its existing and new regulatory responsibilities in 

increasingly complex markets. However, SEC’s organizational culture has 

not been conducive to motivating and encouraging a high level of 

performance—many staff indicated that morale is low and a significant 

percentage characterize the atmosphere of the agency as one of distrust.

Successfully transforming organizational culture requires an effective 

personnel management system. While personnel management 

traditionally has not been a priority at SEC, the agency has placed a new 

emphasis on it. However, continued work—and sustained leadership 

attention—would help to address a number of personnel management 

issues.

First, SEC lacks planning mechanisms to guide decision making about 

the appropriate number and skill mix of staff and does not have a 

transparent process to identify and develop potential leaders for future 

needs. OPM guidance outlines elements of effective workforce and 

succession plans, including action plans that help agencies move forward 

expeditiously and maintain a focus on developing leaders with the 

necessary managerial skills to effectively manage the agency’s 

workforce. SEC is developing workforce and succession plans, but has 

been slow to adopt such plans. Developing workforce and succession 

plans in line with OPM guidance would help ensure that SEC’s planning 

efforts were comprehensive, systematic, and forward looking and focused 

on obtaining, training, and retaining the workforce and leadership to help 

the agency achieve its mission.

Conclusions
Page 41 GAO-13-621 SEC Personnel Management

Second, nonsupervisory and supervisory staff perceptions about SEC’s 

performance appraisal system were broadly negative—many staff viewed 

the way that the system was used as arbitrary and ineffective and some 

supervisors expressed concern about the system lacking meaningful 

incentives for strong performance. While SEC’s performance appraisal 

system reflects many elements of OPM guidance, no system, regardless 

of how well it is designed, will meet its intended purpose if it is not 

implemented well. SEC’s implementation of its performance management 

system could be improved by creating ways to monitor how supervisors 

use the system to recognize and reward performance, provide meaningful 

feedback, and effectively address poor performers and by conducting 

periodic validations with staff input (and making changes, as appropriate), 

consistent with key principles identified in our past work. Although 

developing a performance appraisal system that is appreciated by all 

SEC staff should not be the goal of SEC’s efforts, developing and 

implementing a system that is credible is critical. Without a credible 

system, its value and merit will continue to be questioned.

Third, while SEC has taken steps towards improving intra-agency 

communication, roughly one-third of staff indicated that their divisions did 

not support two-way communication between staff and management. 

Because these are long-standing concerns, sustained leadership to 

improve communication and collaboration within SEC is important and 

exploring and implementing leading communication and collaboration 

practices could better position SEC to address these issues. We

previously reported that top leadership attention of a COO could build and 

maintain an organization-wide commitment to new ways of doing 

business. Furthermore, SEC could implement incentives for all staff to 

foster open communication and collaboration as well as hold them 

accountable for doing so. For example, SEC could recognize exceptional 

teamwork efforts through special awards and set formal expectations of 

its supervisors to foster an environment of communication and 

collaboration. By enhancing its ongoing efforts and taking more steps to 

improve intra-agency communication throughout the agency, SEC can 

improve operations and address widely held views of the agency as 

“siloed” and “hierarchical.”

Finally, SEC has not yet implemented a system to continually monitor and 

evaluate its personnel management system—the activities, policies, and 

programs that include its workforce planning efforts and performance 

appraisal system. According to OPM guidance, such routine monitoring 

and evaluation enables agencies to refine and adjust their approaches to 

help ensure the ongoing effectiveness of personnel management 
Page 42 GAO-13-621 SEC Personnel Management

activities. SEC has started work to develop an accountability system. 

Prioritizing the development of such a system and ensuring that it is 

consistent with HCAAF guidance and standards would put SEC firmly on 

a path to better plan, sustain, and refine its personnel management 

strategies over the long term.

To help SEC address identified personnel management challenges, the 

Chairman should take the following seven actions.

To enhance SEC’s ability to strategically hire and retain the appropriate 

number of staff with the requisite skill sets for today and in the future, the 

Chairman of SEC should direct the COO and OHR to

• prioritize efforts to expeditiously develop a comprehensive workforce 

plan, including a succession plan, and establish time frames for 

implementation and mechanisms to help ensure that the plans are 

regularly updated; and

• incorporate OPM guidance as it develops its workforce and 

succession plans, by developing a formal action plan to identify and 

close competency gaps, and fill supervisory positions; and institute a 

fair and transparent process for identifying high-potential leaders from 

within the agency.

To help enhance the credibility of its performance management system, 

the Chairman of SEC should direct the COO and OHR to

• create mechanisms to monitor how supervisors use the performance 

management system to recognize and reward performance, provide 

meaningful feedback to staff, and effectively address poor 

performance; for example, by requiring ongoing feedback discussions 

with higher-level supervisors; and

• conduct periodic validations (with staff input) of the performance 

management system and make changes, as appropriate, based on 

these validations.

To build on SEC’s efforts to enhance intra-agency communication and 

collaboration, the Chairman should direct the COO to

• identify and implement incentives for all staff to support an 

environment of open communication and collaboration, such as 

setting formal expectations for its supervisors to foster such an 

Recommendations for 

Executive Action
Page 43 GAO-13-621 SEC Personnel Management

environment, and recognizing and awarding exceptional teamwork 

efforts; and

• explore communication and collaboration best practices and 

implement those that could benefit SEC.

Finally, to increase accountability of SEC’s personnel management 

system, the Chairman of SEC should direct the COO and OHR to 

• prioritize and expedite efforts to develop and implement a system to 

monitor and evaluate personnel management activities, policies, and 

programs, including establishing and documenting the steps 

necessary to ensure completion of the system.

We provided SEC a draft copy of this report for review and comment. 

SEC provided written comments that are reprinted in appendix V. In 

written comments, SEC agreed with our recommendations. SEC 

acknowledged that improvements could be made in SEC’s personnel 

management and noted that our report contained useful information that 

will help the agency strengthen personnel management. The letter also 

stated that SEC was committed to investing the time and resources to 

improve its organizational culture and personnel management. For 

example, as we noted in our report, SEC plans to improve its ability to 

identify and address workforce competency gaps through its newly 

established workforce and succession planning function. Three staff 

members will coordinate all workforce succession planning agency-wide. 

In addition, the letter noted that SEC recently implemented pay-forperformance for nonbargaining unit employees, would assess the impact 

of the system on those employees, and offer additional training to 

managers. SEC also agreed that interagency communication and 

collaboration remained challenges, but said these issues were a top 

priority and SEC would continue to leverage the results from the steps it 

is taking to improve in this area. For example, SEC indicated that OCIE 

has recently formed nine specialized working groups, involving over 600 

staff from across the agency, to facilitate the sharing of information on key 

risk areas and industry trends. SEC also stated that it has recently added 

an Assistant Regional Director of Operations position in each regional 

office to help facilitate communication and ensure consistency across the 

agency. Finally, SEC described its most recent progress—developing key 

milestones and deliverables—in implementing an accountability system 

and to monitor and evaluate the personnel management system by the 

end of this calendar year. SEC anticipated that the system would address 

the concerns we cited in this report about aligning human capital 

Agency Comments 
Page 44 GAO-13-621 SEC Personnel Management

practices and strategic goals. We updated our report to reflect SEC’s 

recent progress on this issue.

We are sending copies of this report to interested congressional 

committees and SEC. The report also is available at no charge on the 

GAO website at http://www.gao.gov.

If you or your staffs have any questions about this report, please contact 

A. Nicole Clowers at (202) 512-8678 or clowersa@gao.gov. Contact 

points for our Offices of Congressional Relations and Public Affairs may 

be found on the last page of this report. GAO staff who made major 

contributions to this report are listed in appendix VI.

A. Nicole Clowers

Director

Financial Markets and Community Investment
Appendix I: Objectives, Scope, and 

Methodology

Page 45 GAO-13-621 SEC Personnel Management

This report examines (1) what is known about the Securities and 

Exchange Commission’s (SEC) organizational culture and (2) SEC’s 

personnel management challenges and its efforts to address these 

challenges. We focused the scope of our review on all five divisions and 

one office primarily responsible for implementing the agency’s mission—

Divisions of Corporation Finance; Enforcement; Investment Management; 

Economic and Risk Analysis; Trading and Markets; and the Office of 

Compliance Inspections and Examinations (OCIE). For purposes of this 

report, we refer to these divisions and office as divisions. In the six 

divisions, we focused on employees in four occupational categories 

(accountants, attorneys, examiners, and financial analysts) that account 

for the majority of SEC employees and on all senior officers in those 

divisions. We reviewed management consultant reports, and SEC 

reports, SEC IG reports, and testimonies to describe what is known about 

SEC personnel management challenges and any agency initiatives 

(either planned or under way) to address them during the past few years.

We reviewed the methodology of the management consultant reports and 

SEC IG studies and determined that they were sufficiently reliable for the 

purposes of our report; however, the results should not necessarily be 

considered as definitive, given the potential methodological or data 

limitations contained in the studies individually or collectively. We also 

assessed SEC policies, procedures, and practices against applicable 

federal regulations related to personnel management, the Office of 

Personnel Management’s (OPM) Human Capital Assessment and 

Accountability Framework (HCAAF), GAO reports on human capital 

practices and standards for internal control, and SEC’s strategic plan for 

fiscal years 2010-2015.1

 1

Human Resources Management in Agencies, HCAAF and HCAAF Systems, Standards, 

and Metrics, 73 Fed. Reg. 23012, 23027 (Apr. 28, 2008) (codified at 5 C.F.R. § 250.202 

(2012)); GAO, Organizational Transformation: Implementing Chief Operating Officer/Chief 

Management Officer Positions in Federal Agencies, GAO-08-34 (Washington, D.C.: Nov. 

1, 2007); Human Capital: Key Principles for Effective Workforce Planning, GAO-04-39

(Washington, D.C.: Dec. 11, 2003); Results-Oriented Cultures: Modern Performance 

Management Systems Are Needed to Effectively Support Pay for Performance, 

GAO-03-612T (Washington, D.C.: Apr. 1, 2003); Human Capital: DOD Needs to Improve 

Implementation of and Address Employee Concerns about its National Security Personnel 

System, GAO-08-773 (Washington, D.C.: Sept. 10, 2008); Results-Oriented Government: 

Practices That Can Help Enhance and Sustain Collaboration among Federal Agencies, 

GAO-06-15 (Washington, D.C.: Oct. 21, 2005); Managing Key Results: Key 

Considerations for Implementing Interagency Collaborative Mechanisms, GAO-12-1022

(Washington, D.C.: Sept. 27, 2012); and Standards for Internal Control in the Federal 

Government, AIMD-00-21.3.1 (Washington, D.C.: Nov. 1, 1999).

Appendix I: Objectives, Scope, and 

Methodology
Appendix I: Objectives, Scope, and 

Methodology

Page 46 GAO-13-621 SEC Personnel Management

To conduct our work, we examined SEC policies and procedures for 

carrying out personnel management responsibilities, including recruitment 

and training, performance appraisal, supervision, promotion processes, 

and communication within and among SEC divisions. In addition, we met 

with SEC’s Office of Human Resources and senior leaders from the 

divisions to discuss and collect information on their views on SEC’s 

organizational culture, personnel management challenges, and future 

plans to address these challenges. We also interviewed SEC’s Inspector 

General officials, four former SEC employees, SEC union leaders and 

members, two management consultants who previously worked with 

SEC, representatives from two industry trade groups, and two academics 

with knowledge of SEC personnel management issues to obtain their 

views on the agency’s organizational culture, personnel management 

challenges, and what, if anything, SEC can do to address these 

challenges.

We also conducted eight semistructured group interviews with 

nonsupervisory staff. Each group interview consisted of employees from 

one division to facilitate rapport among the participants. To select 

participants to take part in the first six sessions, we relied on the 

assistance of SEC union leaders to recruit volunteers from each of the 

divisions, To select participants for the last two sessions, we sent e-mails 

to nonsupervisory staff who were not union members to invite them to 

take part in group interview sessions for employees in the Division of 

Enforcement and OCIE, two of the largest divisions at SEC. For each 2-

hour interview, we asked participants to share their views on SEC’s 

organizational culture, what was working well or not well in relation to 

SEC personnel management, and what could be done to address any 

challenges.2

Our methods for gathering perspectives from current SEC employees on 

organizational culture and personnel management issues included 

semistructured one-on-one interviews, focus groups, and two web-based 

surveys of all SEC employees (including senior officers) in the selected 

divisions and occupational groups. This combination of data collection 

The information we gathered during these interviews 

provided an initial understanding of participants’ views on these issues 

and was used to inform the design of later data collection methods.

 2

The results of the in-depth interviews may not be generalized to all SEC employees 

because they represent only the experiences of those taking part in the interviews. 
Appendix I: Objectives, Scope, and 

Methodology

Page 47 GAO-13-621 SEC Personnel Management

techniques was carried out sequentially, so that knowledge gained from 

one technique could be used to inform the design of the next. For 

example, based on information learned through our interview efforts, we 

designed questions used in the focus group effort that followed.3

Individual interviews. We interviewed 129 employees (92 

nonsupervisory staff and 37 supervisors and senior officers) at SEC 

headquarters (in person) and regional offices (by telephone or e-mail) 

during 3 weeks from July through September 2012. We created 

opportunities for all SEC employees from the six divisions and four 

occupational categories to meet or communicate with us individually. At 

headquarters, we established office hours during which employees could 

speak with GAO analysts. To encourage open communication, we had 

separate office hours for nonsupervisory and supervisory employees. 

During the same period, we set up a GAO toll-free phone number and email account to communicate with employees in the regional offices or 

headquarters who could not attend the office hours. We asked certain key 

questions of every person and interjected additional questions as 

appropriate. We also presented SEC Section 962 of the Dodd-Frank Wall 

Street Reform and Consumer Protection Act (Dodd-Frank Act), which 

describes the elements of our study.4

 3

For the purpose of our report, we categorized nonsupervisory and supervisory staff by 

placement under SEC’s pay plan. Nonsupervisory staff were in pay grades SK 12-16 for 

the Division of Enforcement, and SK 12, 13, 14, and 16 for the remaining divisions. 

Supervisory staff were in pay grade SK 17 for the Division of Enforcement, and SK 15 and 

17 for the other divisions. Senior officers were in pay grades SO1-3. These categories 

were current as of July 2012.

We then asked them to describe 

4

Pub. L. No. 111-203, § 962, 124 Stat. 1376, 1908-09 (2010). Section 962 of the DoddFrank Act mandated GAO to evaluate: (A) the effectiveness of supervisors in using the 

skills, talents, and motivation of the employees of the Commission to achieve the goals of 

the Commission; (B) the criteria for promoting employees of the Commission to 

supervisory positions; (C) the fairness of the application of the promotion criteria to the 

decisions of the Commission; (D) the competence of the professional staff of the 

Commission; (E) the efficiency of communication between the units of the Commission 

regarding the work of the Commission (including communication between divisions and 

between subunits of a division) and the efforts by the Commission to promote such 

communication; (F) the turnover within subunits of the Commission, including the 

consideration of supervisors whose subordinates have an unusually high rate of turnover; 

(G) whether there are excessive numbers of low-level, mid-level, or senior-level 

managers; (H) any initiatives of the Commission that increase the competence of the staff 

of the Commission; and (I) the actions taken by the Commission regarding employees of 

the Commission who have failed to perform their duties and circumstances under which 

the Commission has issued to employees a notice of termination. § 962(b)(1)(A)-(I). 
Appendix I: Objectives, Scope, and 

Methodology

Page 48 GAO-13-621 SEC Personnel Management

SEC’s organizational culture, what was working well or not in relation to 

personnel management at SEC, and what could be done to address 

challenges. Employees were encouraged to talk openly and freely. To 

maintain the confidentiality of individual responses, we collected and 

analyzed the information by division and rank only, and aggregated our 

findings so that no individual comments could be identified.

We conducted a content analysis to summarize key themes that emerged 

from the individual interviews. Two GAO analysts independently read 

notes from 23 interviews and made a judgment about appropriate codes 

that described the themes. The analysts compared their decisions and 

reconciled any disagreements, resulting in the following set of coding 

categories: (1) personnel management areas in which SEC has been 

doing well; (2) areas in which there might be challenges, including views 

on SEC’s organizational culture; (3) any comments on initiatives under 

way to address the challenges; and (4) any recommendations for 

addressing the initiatives. This process was replicated several times 

before finalizing the coding structure. Once the coding structure was 

finalized, the content of 129 sets of notes was coded by one analyst and 

then separately reviewed by a second analyst who indicated agreement 

or disagreement with the code. The two analysts then made changes 

based on their resolution to those differences.

Focus Groups. We conducted 22 focus groups with approximately 200 

randomly selected SEC staff and supervisors at headquarters and in four 

regional offices (Forth Worth, Texas; Los Angeles, California; Miami, 

Florida; and New York, New York) from September through December 

2012.5

 5

We invited and confirmed 8 to 10 staff for each focus group, but did not record 

attendance or names in order to ensure confidentiality.

We selected the regional offices based on factors including (1) the 

size and significance of the regional office’s enforcement and examination 

activities as well as the significance of the industry that the regional office 

oversees; (2) efforts made by regional offices to identify and address 

personnel management issues; and (3) geographical variation. For the 

focus groups, we randomly selected supervisory and nonsupervisory staff 

from Enforcement, Corporation Finance, and OCIE from a list SEC 

provided. Although participants were randomly selected and represented 

a broad cross-section of employees, our results are not statistically 
Appendix I: Objectives, Scope, and 

Methodology

Page 49 GAO-13-621 SEC Personnel Management

generalizable.6 We held separate sessions for nonsupervisory and 

supervisory staff. 7

The moderator used a GAO-developed discussion guide to facilitate each 

focus group session and encouraged participants to share their thoughts 

and experiences related to SEC personnel management, organizational 

culture, and what worked well (or not) in relation to these issues.

Participants also were encouraged to comment on initiatives to address 

personnel management challenges and offer suggestions for 

improvement. For each of the 22 focus groups, GAO analysts observed 

and took notes of the discussion and reviewed them to identify recurring 

themes such as training, leadership, performance management, 

communication, and organizational culture. One GAO analyst conducted 

an initial review of the notes and tabulated the frequency of statements 

expressing certain themes, while a second analyst verified the information 

to ensure the tabulation was accurate and that the analyst concurred with 

the results.

For all 22 focus groups, all but a few selected 

employees were able to attend.

Surveys. From January through March 2013, we conducted two separate 

self-administered web-based surveys of all 2,439 listed employees 

(nonsupervisors and supervisors) in four occupational categories and six 

divisions, and all 86 senior officers in six divisions.8

 6

Methodologically, focus groups are not designed to demonstrate the extent of a problem 

or to generalize results to a larger population. Instead, they are intended to generate indepth information about the reasons for the participants’ attitudes on specific topics and 

offer insights into their concerns about or support for an issue.

That is, we performed 

one survey of supervisory and nonsupervisory staff and one of senior 

officers. We chose to survey all staff in the targeted divisions and 

occupational groups instead of a sample to provide the largest feasible 

number of SEC employees a chance to voice their opinions. Each survey 

included questions on (1) personnel management issues related to 

7

Of the 22 sessions, 11 consisted of only nonsupervisory staff and 11 of only supervisory 

staff. Within both these groups, we held single sessions in each of the five locations with 

staff from Enforcement and OCIE, which operate both in headquarters and the regional 

offices. We held one supervisory and one nonsupervisory session with staff from 

Corporation Finance at headquarters. 

8

Our survey population consisted of employees who were employed at SEC as of 

September 30, 2012. From this list, we selected all nonsupervisors and supervisors in the 

six divisions who were mission-critical employees—accountants, attorneys, examiners, 

and financial analysts—and the senior officers in those divisions.
Appendix I: Objectives, Scope, and 

Methodology

Page 50 GAO-13-621 SEC Personnel Management

recruitment, training, staff development, and resources; (2) 

communication between and within divisions and offices; (3) leadership 

and management; (4) performance management and promotions; and (5) 

organizational culture and climate. The separate survey of all SEC senior 

officers (those at the SO-1, SO-2, and SO-3 pay grades) covered the 

same topic areas, but omitted many questions not relevant for senior 

officers and included additional questions specifically relevant for senior 

officers.

A total of 1,905 nonsupervisors and supervisors responded to our staff 

survey for a response rate of 78 percent. A total of 64 senior officers 

responded to our senior officer survey for a response rate of 74 percent. 

For the staff survey, we carried out a statistical nonresponse bias analysis 

using available administrative data and determined that we could not 

assume the nonrespondents were missing at random. For this reason, the 

results of the staff survey are presented as tabulations from a census 

survey. We do not make any attempt to extrapolate the findings to the 22 

percent of eligible staff who chose not to complete our survey.

To minimize other types of errors, commonly referred to as nonsampling 

errors, and enhance data quality, we employed recognized survey design 

practices in the development of the questionnaires and the collection, 

processing, and analysis of the survey data. To develop our survey 

questions, we drew on information from the one-on-one interviews, focus 

group sessions, and prior GAO SEC personnel management surveys. We 

pretested the questionnaire with SEC employees. During survey 

development, we reviewed the survey to ensure the ordering of survey 

sections was appropriate and that questions in each section were clearly 

stated and easily comprehended. A GAO survey expert reviewed and 

provided feedback on our survey instrument. To reduce nonresponse, 

another source of nonsampling error, we undertook an intensive follow-up 

effort that included multiple e-mail reminders to encourage SEC 

employees to complete the questionnaire. We minimized processing 

errors by having a second independent data analyst conduct an accuracy 

check of the computer programs used for data analysis. Also, having the 

respondents complete questionnaires online eliminated errors associated 

with manual data entry. On the basis of our application of these practices 

and follow-up procedures, we determined that the data were of sufficient 

quality for our purposes.

To analyze the information we obtained from the open-ended survey 

responses, we reviewed all the comments and then reviewed the content 

of three survey items in more detail to categorize the information into 
Appendix I: Objectives, Scope, and 

Methodology

Page 51 GAO-13-621 SEC Personnel Management

different themes. For comments related to communication and culture at 

SEC, one GAO analyst initially coded all the information and a second 

analyst reviewed it separately. Both analysts resolved any coding 

discrepancies before finalizing the results. Because of the large number 

of comments relating to performance management, we limited our 

analysis to the first 150 responses and identified examples of recurring 

themes. We coded the comments as described above. Where coding by 

the two analysts matched, we selected some responses to provide 

anecdotes about perceived issues related to SEC performance 

management. The responses are not representative of the views of all 

SEC employees. We also reviewed OPM’s 2012 Federal Employee 

Viewpoint Survey results to obtain additional perspectives from SEC staff 

on the agency’s personnel management-related issues.9

We conducted this performance audit from March 2012 to July 2013 in 

accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.

 9

OPM’s Federal Employee Viewpoint Survey is a tool that measures employees’

perceptions of whether, and to what extent, conditions characterizing successful 

organizations are present in their agencies. Survey results provide valuable insight into 

the challenges agency leaders face in ensuring the government has an effective civilian 

workforce and how well they are responding. The 2012 Federal Employee Viewpoint 

Survey included employees from 82 agencies (constituting 97 percent of executive branch 

agencies). 
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 52 GAO-13-621 SEC Personnel Management

From January through March 2013, we conducted two separate, selfadministered, web-based surveys of: (1) all 2,439 listed employees 

(nonsupervisors and supervisors) in four occupational categories and six 

divisions and (2) all 86 senior officers in six divisions.1 We chose to 

survey all staff in the targeted divisions and occupational groups instead 

of a sample to provide the largest feasible number of SEC employees a 

chance to voice their opinions. Each survey included questions on (1) 

personnel management issues related to recruitment, training, staff 

development, and resources; (2) communication between and within 

divisions and offices; (3) leadership and management; (4) performance 

management and promotions; and (5) organizational culture and climate. 

The separate survey of all SEC senior officers (those at the SO-1, SO-2, 

and SO-3 pay grades) covered the same topic areas, but omitted many 

questions not relevant for senior officers and included additional 

questions specifically relevant for senior officers. The survey is 

reproduced below.

The U.S. Government Accountability Office, an independent agency of 

Congress, has been mandated by the Dodd-Frank Act (Section 962) to 

study personnel management at the Securities and Exchange 

Commission (SEC), including issues related to human capital programs, 

workforce planning, performance management, and communication. As a 

part of our study, we are sending this questionnaire to attorneys, 

accountants, examiners, and financial economists in the Divisions of 

Corporation Finance, Enforcement, Investment Management, Trading 

and Markets, Risk Strategy and Financial Innovation, and the Office of 

Compliance Inspections and Examinations (OCIE) to obtain their opinions 

about various aspects of working at the SEC.2

 1

Our survey population consisted of employees who were employed at SEC as of the end 

of fiscal year 2012. From this list, we selected all nonsupervisors and supervisors in the 

six divisions who were mission-critical employees—accountants, attorneys, examiners, 

and financial analysts—and the senior officers in those divisions. The six divisions were 

Corporation Finance, Enforcement, Investment Management, Trading and Markets, 

Economics and Risk Analysis, and the Office of Compliance Inspections and 

Examinations (OCIE).

Your cooperation is critical 

to providing the Congress with complete and balanced information on 

2

The Division of Risk, Strategy, and Financial Innovation changed its name to the Division 

of Economic and Risk Analysis in June 2013, after our survey was conducted. We will 

present the survey results consistent with how the information was presented to survey 

respondents. 

Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Survey Introduction
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 53 GAO-13-621 SEC Personnel Management

how personnel management is functioning across these offices and 

divisions within the SEC. This questionnaire should take about 30 

minutes to complete.

The results of this questionnaire will be used to compile descriptive 

information on SEC’s personnel management. GAO pledges to maintain 

the confidentiality of the responses to this survey. Your information will be 

kept confidential and will not be released outside GAO, unless compelled 

by law or requested by the Congress. Our report will provide results in 

summary form; individual answers may be discussed, but we will not 

include any information that could be used to identify individual 

respondents, and any link between the identification number assigned to 

your questionnaire and your identifying information will be destroyed.

All of the questions in this survey can be answered by clicking on radio 

buttons or providing comments in spaces provided at the end of each 

section. Please complete the questionnaire within 10 business days of 

receipt. This questionnaire is divided by topic into six sections:

1. Recruitment, Training, Staff Development, and Resources

2. Communication between and within SEC Divisions and Offices

3. Leadership and Management

4. Performance Management and Promotions

5. Organizational Culture and Climate

6. Demographics and Background Information; and

7. Final Comments.

Although your participation is voluntary, we urge you to complete this 

questionnaire. We cannot develop meaningful information without your 

frank and honest answers.

Thank you very much for your time.
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 54 GAO-13-621 SEC Personnel Management

Note: For each question, the two rows of results correspond to 

nonsupervisory in the first row and supervisor in the second row.

1. To what extent do you agree or disagree with the following statements 

on recruitment, hiring and retention? (Select one response per item.)

Strongly 

Agree/

Somewhat 

Agree

Neither 

Agree nor 

Disagree

Strongly 

Disagree/ 

Somewhat 

disagree

Do Not 

Know

Not 

Checked

a. My division/office is able to attract talented and 

qualified employees. 86.4% 6.4% 5.5% 1.5% 0.2%

92.6 3.3 3.6 0.3 0.3

b. My division/office retains its most talented and 

qualified employees. 52.9 16.7 26.9 3.1 0.5

69.5 12.3 17.4 0.3 0.5

c. Management usually hires employees who are a 

good fit for SEC’s mission. 70.2 14.1 13.1 2.0 0.7

82.3 8.7 8.5 0 0.5

d. When new people start in jobs in my division/office, 

they are given enough guidance and training. 38.4 16.1 38.8 5.8 1.0

65.1 15.4 18.0 1.0 0.5

e. Hiring is sometimes based more on personal 

connections than on substantive experience or 

qualifications.

23.5 20.0 41.9 14.0 0.6

15.4 8.2 73.1 3.1 0.3

f. Overall, SEC’s Office of Human Resources 

provides timely support to my division/office. 14.5 20.0 34.8 29.8 0.8

21.0 19.5 49.2 9.7 0.5

g. SEC’s Office of Human Resources has the 

necessary expertise to assist in recruiting and hiring

qualified employees.

10.6 18.4 31.9 38.5 0.6

12.8 21.5 46.7 18.0 1.0

Survey Results 

of Nonsupervisors 

and Supervisors
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 55 GAO-13-621 SEC Personnel Management

2. To what extent do you agree or disagree with the following statements 

on training and development opportunities? (Select one response per 

item.)

Strongly 

Agree/ 

Somewhat 

Agree

Neither 

Agree nor 

Disagree

Strongly 

Disagree/ 

Somewhat 

disagree

Do Not 

Know

Not 

Checked

a. SEC management is committed to the ongoing 

training and development of staff. 67.0 13.1 18.7 0.8 0.5

85.1 6.9 6.9 0 1.0

b. SEC needs to invest more in the development of 

new staff. 72.2 17.9 5.5 3.6 0.8

62.8 18.5 16.2 0.8 1.8

c. The training I have received over the past three 

years has provided me skills and experience to meet 

SEC’s needs.

60.3 17.2 20.0 1.9 0.7

70.3 19.0 9.2 0.3 1.3

d. Employees in my division/office are currently given 

the same opportunities to participate in training 

programs and events.

66.8 9.8 16.3 6.3 0.9

86.2 4.9 6.9 1.3 0.8

e. Management in my division/office needs to do 

more to address skills gaps. 53.7 26.3 13.5 5.8 0.8

47.2 27.2 24.4 0.3 1.0

f. Over the past three years, SEC’s leadership training 

has been effective in improving the management 

skills of supervisors and managers in my 

division/office.

17.8 22.4 39.7 19.6 0.6

54.6 19.0 22.6 2.8 1.0
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 56 GAO-13-621 SEC Personnel Management

3. For those training opportunities that you have been involved with over 

the past three years, to what extent, if at all, have the following types of 

training provided information and knowledge that is directly relevant to 

your work? (Select one response per item.)

To a 

great 

extent

To a 

moderate 

extent

To a 

small 

extent

To no 

extent

No basis 

to judge

Do not 

know

Not 

checked

a. Training provided by the SEC University 16.6 38.5 26.8 5.8 8.4 3.0 0.8

20.0 43.1 26.7 3.9 4.6 1.5 0.3

b. Internal training delivered by SEC staff, but not 

through SEC University 24.3 41.6 20.0 6.2 5.2 1.8 1.0

35.1 38.7 20.3 2.0 2.3 1.3 0.3

c. External training or conferences 15.7 28.9 21.2 10.1 19.0 4.1 1.0

16.9 35.1 18.0 10 16.9 1.3 1.8

d. Computer-based training delivered by Internet 8.2 29.9 31.0 12.8 12.3 4.2 1.6

6.4 32.8 35.9 9.5 12.6 2.1 0.8

4. Have there been opportunities over the past three years for you to 

participate in training that provided the latest industry specific knowledge 

relevant to your job with outside instructors who are experts in the field?

Yes 73.2 80.3

No 18.8 14.4

Do not know 7.1 4.9

Not checked 0.9 0.5

5. In general, how adequate, is the number of training opportunities that 

provide the latest industry specific knowledge relevant to your job with 

outside instructors who are experts in the field?

More than adequate 10.9 18.0

Adequate 40.5 42.1

Less than adequate 41.0 35.1

Do not know 7.1 4.6

Not checked 0.6 0.3
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and Human Capital Management

Page 57 GAO-13-621 SEC Personnel Management

6. Over the past 3 years, how many times have you taken part in training 

that provided the latest industry specific knowledge relevant to your job 

that included outside instructors who are experts in the field?

Never 11.4 11.3

Once or twice 45.7 38.7

Three or more times 37.8 44.9

Do not know 4.5 4.9

Not checked 0.8 0.3

7. If there are any other issues, details, or information concerning 

recruitment, training, staff development and resources that you would like 

us to know about, please use the space below to provide this information.

We will not present detailed comments.
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 58 GAO-13-621 SEC Personnel Management

8. To what extent do you agree or disagree with the following statements 

regarding communication within your division/office and between your 

division/office and other SEC offices and divisions? (Select one response 

per item.)

Strongly 

Agree/ 

Somewhat 

Agree

Neither 

Agree nor 

Disagree

Strongly 

Disagree/ 

Somewhat 

disagree

Do Not 

Know

Not 

Checked

a. Supervisors and managers ensure that employees 

are included in the flow of relevant information. 47.7 11.6 39.0 1.3 0.3

73.1 8.0 19.0 0 0

b. My division/office supports open, two-way 

communication between staff and management. 49.5 13.5 35.4 0.9 0.6

72.8 10.0 17.2 0 0

c. Information is adequately shared across groups in 

my division/office. 34.1 14.1 47.5 3.0 1.3

55.1 14.1 29.0 0.5 1.3

d. Communication across groups in my division/office 

has improved over the past three years. 33.0 23.3 30.3 12.8 0.7

64.4 16.9 17.2 1.0 0.5

e. Overall, information and knowledge are shared 

openly at all levels within my division/office. 29.9 17.0 48.7 3.8 0.7

52.6 14.6 30.3 1.3 1.3

f. In my division/office, communication between other 

offices and divisions (such as between OCIE and 

CorpFin) on work related matters is encouraged.

54.3 18.7 21.5 4.9 0.7

75.1 14.6 8.7 1.3 0.3
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 59 GAO-13-621 SEC Personnel Management

9. In the past 12 months, how often, if at all, did you typically contact 

employees in the following Home Office divisions or offices for workrelated issues such as to coordinate activities or ask for expert advice? 

(Select one response per item. Select “Not Applicable” if you work in that 

division or office.)

Daily

One or 

more 

times a 

week

One or 

more 

times a 

month

One or 

more 

times in 

the past 

12 

months Never

Do not 

know

Not 

applicable

Not 

checked

a. OCIE 2.5 4.2 11.6 34.3 39.1 1.2 5.8 1.4

5.4 8.7 27.7 32.1 19.7 0.3 5.4 0.8

b. Division of Enforcement 8.0 5.8 16.6 32.6 21.3 0.8 13.1 1.9

10 11.0 26.7 32.8 10 0.3 8.5 0.8

c. Division of Corporation Finance 6.0 2.4 9.7 34.7 33.4 1.0 10.9 1.9

7.4 2.1 17.7 31.0 28.2 0.5 11.0 2.0

d. Division of Investment Management 1.6 1.8 8.8 33.7 45.3 1.2 6.4 1.2

2.6 4.6 18.7 44.9 23.3 0.5 4.6 0.8

e. Division of Trading and Markets 3.6 2.8 8.8 35.3 40.0 1.2 6.8 1.6

3.6 6.2 20.3 36.4 26.7 0.8 4.9 1.3

f. Division of Risk, Strategy, and 

Financial Innovation 0.8 3.0 10.3 23.7 53.4 1.6 5.5 1.6

1.0 3.9 12.6 38.7 38.2 2.1 3.3 0.3
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 60 GAO-13-621 SEC Personnel Management

10. In the past 12 months, how often did employees in the following 

Home Office divisions or offices get back to you promptly in response to 

requests for assistance with work-related issues such as to coordinate 

activities or provide expert advice? (Select one response per item. Select 

“Not Applicable” if you work in that division or office or if you did not 

communicate with that division or office in the past 12 months.)

Always or 

almost 

always

Most of 

the time

About 

half of the 

time

Some of 

the time

Never or 

almost 

never

Do not 

know

Not 

applicable

Not 

checked

a. OCIE 28.3 17.3 1.4 2.7 2.2 3.0 44.1 1.0

41.5 25.9 2.3 1.8 0.8 0.8 25.1 1.8

b. Division of Enforcement 32.0 21.3 2.4 3.6 2.1 2.3 35.1 1.4

39.7 31.3 2.6 3.6 0.5 0.8 21.0 0.5

c. Division of Corporation Finance 28.04 17.4 1.3 3.3 1.9 2.6 43.9 1.6

29.5 22.1 2.8 2.3 1.0 1.5 40.0 0.8

d. Division of Investment 

Management 22.9 15.4 1.6 2.9 2.1 3.4 49.9 1.7

32.6 23.3 6.4 2.8 1.3 2.6 29.5 1.5

e. Division of Trading and 

Markets 25.4 16.7 1.3 3.1 2.4 3.8 45.3 2.0

26.7 27.2 4.6 5.1 1.8 2.8 30.8 1.0

Division of Risk, Strategy, and 

Financial Innovation 22.0 11.1 1.3 1.4 1.6 4.4 55.3 3.0

26.9 21.3 2.1 1.3 0.8 4.1 42.3 1.3

11. In which location do you currently work?

Home office (Washington, D.C.) 48.6 46.7

A regional or district office 50.8 52.8

Not checked 0.6 0.5
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 61 GAO-13-621 SEC Personnel Management

11a. In the past 12 months, how often, if at all, did you typically 

communicate with employees in the other division or office within your 

Regional Office for work-related issues such as to coordinate activities or 

ask for expert advice? (Select one response per item. Select “Not 

Applicable” if you work in that Office or Division in your Regional Office.)

Daily

One or 

more times 

a week

One or 

more times 

a month

One or 

more times 

in the past 

12 months Never

Do Not 

Know

Not 

Applicable

Not 

Checked

OCIE 9.5 9.9 19.5 28.0 12.1 1.1 17.5 2.4

Division of 

Enforcement 14.3 8.7 13.4 26.7 8.9 1.1 23.8 3.0

11b. In the past 12 months, how often did employees in the other division 

within your Regional Office get back to you promptly in response to 

requests for assistance with work-related issues such as to coordinate 

activities or provide expert advice? (Select one response per item. Select 

“Not Applicable” if you work in that Office or Division or if you did not 

communicate with that division or office in the past 12 months.)

Always or 

almost 

always

Most of 

the time

About half 

of the time

Some of 

the time

Never or 

almost 

never

Do Not 

Know

Not 

Applicable

Not 

Checked

OCIE 46.1 16.3 1.4 2.3 1.2 1.6 28.9 2.2

Division of 

Enforcement 39.8 18.7 1.7 2.8 1.0 1.5 30.6 3.9

12. If there are any other issues, details, or information concerning 

communication between and within divisions and offices that you would 

like us to know about, please use the space below to provide this 

information.

We will not present detailed comments.
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 62 GAO-13-621 SEC Personnel Management

13. To what extent do you agree or disagree with the following statements 

regarding the quality of management and leadership in your 

division/office. (Select one response per item.)

Strongly 

Agree/ 

Somewhat 

Agree

Neither 

Agree nor 

Disagree

Strongly 

Disagree/ 

Somewhat 

disagree

Do Not 

Know

Not 

Checked

a. Supervisors and managers in my division/office are 

held accountable for achieving results that help SEC 

meet its goals and priorities.

42.5 13.4 25.0 18.9 0.3

74.9 6.2 15.1 3.6 0.3

b. In my division/office, the roles and responsibilities 

of supervisors and managers are clearly defined. 45.7 14.2 32.2 7.7 0.3

69.2 8.5 21.8 0.3 0.3

c. Supervisors and managers in my division/office are 

genuinely interested in the opinions of their staff. 54.9 12.2 30.3 1.6 0.9

73.3 8.7 17.2 0 0.8

d. 360 degree feedback is an effective way for 

employees to provide feedback on the performance of 

their supervisors.

50.2 12.0 14.8 22.5 0.5

47.2 15.9 20.0 16.7 0.3

e. Promotion to management is mostly based on 

technical skills. 18.1 16.0 47.4 18.5 0

47.2 17.2 31.3 4.1 0.3

f. Promotion to management is mostly based on the 

ability to manage people effectively. 13.8 12.5 57.5 15.9 0.4

41.5 15.9 38.0 4.1 0.5

g. Promotion to management is mostly based on 

connections that staff have with management. 54.9 14.6 12.4 17.6 0.6

35.6 19.2 39.5 4.9 0.8

h. There is not much incentive to get promoted into a 

management position because the salary increase is 

minimal.

51.6 16.8 20.3 10.9 0.3

74.1 6.7 17.2 1.3 0.8

i. Over the past 3 years, I have seen SEC staff leave 

due to being dissatisfied with a supervisor or 

manager.

57.7 10.0 13.0 18.9 0.4

46.4 13.3 28.5 10.5 1.3
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 63 GAO-13-621 SEC Personnel Management

14. Over the past three years, to what extent, if at all, have the Senior 

Officers (SOs) in your division/office worked to make improvements in the 

areas listed below? (Select one response per item. Please note that 

“division/office” refers to your division or office (such as Corporation 

Finance in the Home Office or a Division or Enforcement in a regional 

office))

To no 

extent

To a 

small 

extent

To a 

moderate 

extent

To a 

great

extent

No basis 

to judge

Do not 

know

Not 

checked

a. Workforce morale 30.1 27.7 18.6 10.4 7.2 5.7 0.3

19.7 31.0 27.7 17.7 2.6 1.3 0

b. Collaboration between divisions and offices 16.8 21.7 23.5 14.5 12.2 10.7 0.6

10.8 19.2 32.6 29.5 4.4 3.3 0.3

c. Staff training focused on specific competencies 14.2 26.1 28.8 13.5 8.3 8.4 0.6

10.0 23.6 37.2 22.6 3.3 3.1 0.3

d. Transparency in the promotion process 51.6 12.4 5.5 1.9 15.3 12.9 0.4

34.4 18.7 18.0 8.7 11.5 8.5 0.3

15. Over the past three years, to what extent, if at all, has management 

solicited employees’ ideas and suggestions in developing initiatives 

designed to improve communication, the performance management 

system, and training opportunities? (Select one response per item.)

Management solicited employees’ idea and suggestions in developing...

To a 

great 

extent

To a 

moderate 

extent

To a 

small 

extent

To no 

extent

Not 

aware of 

any such 

initiative

Do not 

know

Not 

checked

a. Initiatives designed to improve communication 9.1 21.3 20.9 20.3 19.0 8.8 0.6

20.5 31.5 22.6 11.5 8.5 5.1 0.3

b. Initiatives designed to improve the performance 

management system

5.0 13.7 17.3 32.8 16.8 13.8 0.6

7.7 16.9 25.6 20.5 0.8 20.5 8.0

c. Initiatives designed to improve training 

opportunities

13.5 28.9 23.5 12.2 11.7 9.1 1.1

28.2 36.9 20.5 7.2 2.8 2.8 1.5
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 64 GAO-13-621 SEC Personnel Management

16. Over the past three years, how satisfied have you been with initiatives 

management developed to improve communication, the performance 

management system, and training opportunities? (Select one response 

per item.) 

Very 

satisfied

Somewhat 

satisfied

Somewhat 

dissatisfied

Very 

dissatisfied

Not aware 

of any such 

initiative

Do not 

know

Not 

checked

a. Initiatives designed to 

improve communication

6.6 27.2 16.4 16.6 23.2 9.0 1.1

13.9 44.9 17.2 9.7 10.0 4.1 0.3

b. Initiatives designed to 

improve the performance 

management system

2.3 17.1 18.1 30.2 19.0 11.6 1.8

9.2 29.0 21.5 27.4 7.7 3.9 1.3

c. Initiatives designed to 

improve training opportunities

14.1 37.9 15.1 10.3 12.4 8.5 1.7

25.1 48.2 12.6 5.6 4.6 2.8 1.0

17. Are the numbers of supervisors and managers currently in your 

division/offices more than is needed, less than is needed, or an 

appropriate amount given the current workload?

More than needed 24.6 14.1

An appropriate amount 50.3 51.8

Less than needed 15.1 32.6

Do not know 9.2 1.3

Not checked 0.8 0.3

18. Are the numbers of levels of supervisions currently in your 

division/offices more than is needed, less than is needed, or an 

appropriate amount given the current workload?

More than needed 26.2 13.9

An appropriate amount 58.6 69.2

Less than needed 7.4 14.6

Do not know 7.1 1.8

Not checked 0.8 0.5
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 65 GAO-13-621 SEC Personnel Management

19. What is your current, direct supervisor’s position or title?

Branch Chief 20.0 2.3

Exam Manager 7.0 2.6

Assistant Director 56.0 39.5

Associate Director 6.0 44.6

Other 10.4 10.8

Not checked 0.6 0.3

20. To what extent do you agree or disagree with the following statements 

regarding your current direct supervisors? (Select one response per 

item.)

Strongly

Agree/ 

Somewhat 

Agree

Neither 

Agree nor 

Disagree

Strongly 

Disagree/ 

Somewhat 

disagree

Do Not 

Know

Not 

Checked

a. Is knowledgeable in the issue areas I conduct 

my work. 83.9 4.2 9.9 1.0 1.0

88.2 1.5 9.2 0.5 0.5

b. Has the skills and expertise to be an effective 

supervisor or manager. 72.1 7.5 18.4 1.2 0.8

79.2 4.1 14.9 0.5 1.3

c. Does a good job in sharing information. 69.6 9.0 19.4 0.9 1.0

78.0 7.4 13.3 0.5 0.8

d. Clearly defines goals and expectations. 66.6 10.2 21.6 0.6 1.0

73.3 9.2 15.9 0.5 1.0

e. Provides useful and constructive feedback. 65.3 11.9 20.1 1.0 1.6

70.5 9.5 16.7 1.0 2.3

f. Will listen to me if we have differing ideas or 

approaches. 76.8 7.0 13.4 1.8 1.0

86.1 2.8 8.5 1.3 1.3

g. Is willing to change his or her position when there 

is compelling information. 73.5 8.3 12.6 4.3 1.4

82.1 6.2 8.0 2.8 1.0

h. Gives me the flexibility I need to do my job 

effectively. 83.2 6.3 8.3 0.7 1.5

88.7 4.1 5.6 0.5 1.0

i. Spends too much time closely monitoring my work. 10.3 14.4 73.0 1.1 1.2

10.8 12.1 75.1 1.0 1.0
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 66 GAO-13-621 SEC Personnel Management

21. If there are any other issues, details, or information concerning 

leadership and management at SEC that you would like us to know 

about, please use the space below to provide this information.

We will not present detailed comments.

22. To what extent do you agree or disagree with the following statements 

regarding how SEC management recognizes and rewards performance in 

your division/office? (Select one response per item.)

Strongly 

Agree/ 

Somewhat 

Agree

Neither 

Agree nor 

Disagree

Strongly 

Disagree/ 

Somewhat 

disagree

Do Not 

Know

Not 

Checked

a. Overall, senior officers deal effectively with poor 

performing supervisors and managers.

5.3 9.9 56.2 28.4 0.1

24.9 15.1 46.7 13.3 0

b. Overall, supervisors and managers deal effectively 

with poor performing staff.

9.6 12.4 51.1 26.6 0.3

28.5 12.8 55.1 3.1 0.5

c. Supervisors and managers are quick to provide 

feedback to staff whose performance is unacceptable.

9.5 12.2 33.8 43.5 1.0

36.9 21.0 35.9 5.9 0.3

d. I know what is expected of me regarding my work 

performance.

74.5 10.3 14.2 0.8 0.3

86.4 4.6 8.5 0.5 0

e. My direct supervisor provides sufficient 

performance feedback.

67.9 12.3 17.4 1.8 0.7

74.9 9.0 14.6 1.0 0.5

f. The criteria for rewarding staff are clearly defined. 17.5 14.0 63.8 4.5 0.3

39.5 16.7 42.6 0.8 0.5

g. The criteria for promoting staff are clearly defined. 10.0 13.6 68.9 7.3 0.3

37.7 18.5 41.3 1.8 0.8

h. For promotion opportunities, the quantity of 

reviews, exams, or cases is more important than their 

complexity or difficulty.

19.7 19.0 23.2 37.4 0.8

11.5 17.4 61.0 9.5 0.5

i. The opportunities in my division/office to get 

promoted into a management position are limited.

78.7 8.3 7.1 5.5 0.5

83.1 7.2 9.5 0.3 0

j. Favoritism is typically not an issue in promotions. 15.5 15.5 46.2 22.2 0.6

54.4 11.8 29.7 3.9 0.3
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 67 GAO-13-621 SEC Personnel Management

Strongly 

Agree/ 

Somewhat 

Agree

Neither 

Agree nor 

Disagree

Strongly 

Disagree/ 

Somewhat 

disagree

Do Not 

Know

Not 

Checked

k. Promotions go to those who most deserve it. 19.7 16.4 44.5 18.5 1.0

57.7 16.7 21.5 3.1 1.0

l. There is a clear link between my performance and 

recognition of it.

37.6 17.4 38.6 5.5 1.0

60.5 14.1 24.6 0 0.8

m. Current performance incentives are effective tools 

to motivate employees to perform well.

12..0 14.2 67.2 5.9 0.7

14.9 15.4 68.5 0.8 0.5

23. To what extent do you agree or disagree with the following statements 

regarding SEC’s current performance management system? (Select one 

response per item.)

Strongly 

Agree/ 

Somewhat 

Agree

Neither 

Agree nor 

Disagree

Strongly 

Disagree/ 

Somewhat 

disagree

Do Not 

Know

Not 

Checked

a. SEC’s 5-point rating system allows for an accurate 

representation of my performance over the rating 

period.

25.6 15.7 52.4 5.8 0.6

45.4 11.8 41.3 1.3 0.3

b. How competencies are weighted accurately reflects 

the relative importance of my work.

19.1 19.3 50.4 10.3 0.9

30.5 17.2 49.7 2.1 0.5

c. SEC’s performance management system uses 

relevant criteria to evaluate my performance.

31.1 18.0 44.0 5.5 1.4

46.7 12.8 39.2 0.5 0.8

d. SEC’s performance management system allows 

supervisors and managers to have a meaningful 

discussion with their staff on how they are performing.

32.6 17.7 43.3 5.1 1.2

52.6 15.1 30.5 0.5 1.3

e. SEC’s performance management system provides 

consistent standards for rewarding performance.

16.4 16.3 57.9 8.6 0.9

36.4 16.2 44.6 2.6 0.3

f. Changes need to be made to increase transparency 

in the process used to rate my performance.

60.1 19.2 13.3 6.1 1.3

44.6 26.2 26.9 1.0 1.3
Appendix II: GAO Survey on SEC Personnel 

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Page 68 GAO-13-621 SEC Personnel Management

Strongly 

Agree/ 

Somewhat 

Agree

Neither 

Agree nor 

Disagree

Strongly 

Disagree/ 

Somewhat 

disagree

Do Not 

Know

Not 

Checked

g. Calibration of performance ratings by management 

improves fairness in the performance management 

system.

20.2 20.0 36.5 22.1 1.3

50.3 13.1 33.1 3.3 0.3

h. Employee performance appraisals are fair and 

appropriate under SEC’s performance management 

system.

20.1 21.0 42.8 14.8 1.2

51.8 18.5 26.9 1.5 1.3

24. if there are any other issues, details, or information concerning 

performance management and promotions at SEC that you would like us 

to know about, please use the space below to provide this information.

We will not present detailed comments.

25. To what extent do you agree or disagree with the following statements 

regarding different aspects of organizational culture and climate within 

your division/office? (Select one response per item.)

Strongly 

Agree/ 

Somewhat 

Agree

Neither 

Agree nor 

Disagree

Strongly 

Disagree/ 

Somewhat 

disagree

Do Not 

Know

Not 

Checked

a. There is an atmosphere of trust in my division/office. 45.1 13.4 40.0 1.1 0.4

59.0 10.5 30.3 0.3 0

b. Employee morale is generally high most of the time. 29.8 14.5 54.1 1.2 0.4

38.2 18.2 42.6 0.8 0.3

c. I have a voice in decisions that affect me and my 

work environment. 38.3 17.9 41.8 1.3 0.8

63.1 12.1 23.6 0 1.3

d. Management in my division/office has taken steps to 

improve employee morale. 30.2 18.5 44.7 6.2 0.4

52.6 16.4 30.3 0.5 0.3

e. Supervisors and managers in my division/office 

tolerate honest mistakes as learning experiences. 56.4 15.5 19.2 8.2 0.7

75.1 11.3 12.3 1.0 0.3
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 69 GAO-13-621 SEC Personnel Management

Strongly 

Agree/ 

Somewhat 

Agree

Neither 

Agree nor 

Disagree

Strongly 

Disagree/ 

Somewhat 

disagree

Do Not 

Know

Not 

Checked

f. Protecting investors is sometimes hampered by staff 

or managers who view firms as places they can 

potentially work at in the future.

10.2 7.0 71.5 10.9 0.4

5.9 4.9 86.4 2.1 0.8

g. There are clearly defined policies and procedures 

for doing my work. 56.8 17.9 24.1 0.9 0.3

73.3 12.6 13.3 0.3 0.5

h. Innovative ideas are encouraged in my 

division/office. 50.1 17.5 30.1 1.4 0.9

67.4 13.9 17.7 0 1.0

i. Fear of public scandals has made SEC overly 

cautious and risk-averse.

54.5 16.7 21.0 7.5 0.3

57.4 14.6 24.6 2.3 1.0

j. In my view, the fear of being wrong makes 

supervisors and managers in my division/office 

reluctant to take a stand on important issues.

49.3 15.1 29.5 5.8 0.3

41.5 12.8 44.4 0.8 0.5

k. In my view, the fear of being wrong makes senior 

officers in my division/office reluctant to take a stand 

on important issues.

46.7 15.1 26.6 10.9 0.8

44.1 13.6 38.5 3.6 0.3

26. If there are any other issues, details, or information concerning the 

organizational culture or climate at the SEC or in your division/office that 

you would like us to know about, please use the space below to provide 

this information.

We will not present detailed comments.
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 70 GAO-13-621 SEC Personnel Management

1. To what extent do you agree or disagree with the following statements 

on recruitment, hiring and retention? (Select one response per item.)

Strongly 

Agree/ 

Somewhat 

Agree

Neither 

Agree nor 

Disagree

Strongly 

Disagree/ 

Somewhat 

disagree

Do Not 

Know

Not 

Checked

a. My division/office is able to attract talented and 

qualified employees. 92.2 1.6 6.3 0 0

b. My division/office retains its most talented and 

qualified employees. 84.4 6.3 9.4 0 0

c. When new people start in jobs in my division/office, 

they are given enough guidance and training. 71.9 10.9 12.5 1.6 3.1

d. Hiring is sometimes based more on personal 

connections than on substantive experience or 

qualifications.

3.1 3.1 92.2 0 1.6

e. Overall, SEC’s Office of Human Resources provides 

timely support to my division/office. 14.1 17.2 64.1 3.1 1.6

f. SEC’s Office of Human Resources has the 

necessary expertise to assist in recruiting and hiring 

qualified employees.

6.3 15.6 71.9 6.3 0

2. To what extent do you agree or disagree with the following statements 

on training and development opportunities? (Select one response per 

item.)

Strongly 

Agree/ 

Somewhat 

Agree

Neither 

Agree nor 

Disagree

Strongly 

Disagree/ 

Somewhat 

disagree

Do Not 

Know

Not 

Checked

a. SEC needs to invest more in the development of 

new staff. 68.8 23.4 6.3 1.6 0

b. The training I have received over the past three 

years has provided me skills and experience to meet 

SEC’s needs.

65.6 26.6 7.8 0 0

c. Management in my division/office needs to do more 

to address skills gaps. 51.6 21.9 21.9 1.6 3.1

d. Over the past three years, SEC’s leadership training 

has been effective in improving the management skills 

of supervisors and managers in my division/office.

70.3 15.6 4.7 9.4 0

Survey Results of 

Senior Officers
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 71 GAO-13-621 SEC Personnel Management

3. For those training opportunities that you have been involved with over 

the past three years, to what extent, if at all, have the following types of 

training provided information and knowledge that is directly relevant to 

your work? (Select one response per item.)

To a 

great 

extent

To a 

moderate 

extent

To a 

small 

extent

To no 

extent

No basis 

to judge

Do not 

know

Not 

checked

Training provided by the SEC University 15.6 43.8 28.1 6.3 6.3 0 0

Internal training delivered by SEC staff, but not 

through SEC University 26.6 57.8 9.4 1.6 3.1 0 1.6

External training or conferences 12.5 43.8 28.1 1.6 12.5 0 1.6

Computer-based training delivered by Internet 4.7 29.7 50.0 9.4 4.7 0 1.6

4. If there are any other issues, details, or information concerning 

recruitment, training, staff development and resources that you would like 

us to know about, please use the space below to provide this information.

We will not present detailed comments.

5. To what extent do you agree or disagree with the following statements 

regarding communication within your division/office and between your 

division/office and other SEC offices and divisions? (Select one response 

per item.)

Strongly 

Agree/ 

Somewhat 

Agree

Neither 

Agree nor 

Disagree

Strongly 

Disagree/ 

Somewhat

disagree

Do Not 

Know

Not 

Checked

a. My division/office supports open, two-way 

communication between staff and management. 93.8 4.7 1.6 0 0

b. Information is adequately shared across groups in 

my division/office. 81.3 9.4 7.8 0 1.6

c. Communication across groups in my division/office 

has improved over the past three years. 82.8 9.4 7.8 0 0

d. Overall, information and knowledge are shared 

openly at all levels within my division/office. 67.2 15.6 17.2 0 0

e. In my division/office, communication between other 

offices and divisions (such as between OCIE and 

CorpFin) on work related matters is encouraged.

93.8 3.1 3.1 0 0
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 72 GAO-13-621 SEC Personnel Management

7. To what extent do you agree or disagree with the following statements 

regarding the quality of management and leadership in your 

division/office. (Select one response per item.)

Strongly 

Agree/ 

Somewhat 

Agree

Neither 

Agree nor 

Disagree

Strongly 

Disagree/ 

Somewhat 

disagree Do Not Know Not Checked

a. In my division/office, the roles and responsibilities 

of senior officers are clearly defined. 82.8 3.1 14.1 0 0

b. In my division/office, the roles and responsibilities 

of non-senior officer supervisors and managers are 

clearly defined.

90.6 3.1 4.7 0 1.6

c. Senior officers in my division/office are genuinely 

interested in the opinions of their employees. 95.3 3.1 1.6 0 0

d. Non-senior officer supervisors and managers in my 

division/office are genuinely interested in the opinions 

of their staff.

95.3 1.6 1.6 0 1.6

e. 360 degree feedback is an effective way for 

employees to provide feedback on the performance of 

their supervisors.

54.7 17.2 20.3 0 7.8

f. Promotion to management is mostly based on 

technical skills. 56.3 28.1 15.6 0 0

g. Promotion to management is mostly based on the 

ability to manage people effectively. 62.5 21.9 15.6 0 0

h. There is not much incentive to get promoted into a 

management position because the salary increase is 

minimal.

42.2 10.9 42.2 3.1 1.6

i. Over the past 3 years, I have seen SEC staff leave 

due to being dissatisfied with a supervisor or 

manager.

29.7 12.5 37.5 20.3 0

8. Are the numbers of supervisors and managers currently in your 

division/office more than is needed, less than is needed, or an 

appropriate amount given the current workload?

More than needed 7.8

An appropriate amount 51.6

Less than needed 35.9

Do not know 3.1

Not checked 1.6
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 73 GAO-13-621 SEC Personnel Management

9. Are the numbers of levels of supervisions currently in your 

division/office more than is needed, less than is needed, or an 

appropriate amount given the current workload?

More than needed 4.7

An appropriate amount 70.3

Less than needed 20.3

Do not know 3.1

Not checked 1.6

10. If there are any other issues, details, or information concerning 

leadership and management at SEC that you would like us to know 

about, please use the space below to provide this information.

We will not present detailed comments.

11. To what extent do you agree or disagree with the following statements 

regarding how SEC management recognizes and rewards performance in 

your division/office? (Select one response per item.)

Strongly 

Agree/ 

Somewhat 

Agree

Neither 

Agree or 

Disagree

Strongly 

Disagree/ 

Somewhat 

disagree

Do Not 

Know

Not 

Checked

a. Overall, senior officers deal effectively with poor 

performing supervisors and managers. 56.3 17.2 23.4 3.1 0

b. I know what is expected of me regarding my work 

performance. 79.7 7.8 12.5 0 0

c. My direct manager provides sufficient performance 

feedback. 60.9 18.8 15.6 4.7 0

d. The opportunities in my division/office to get 

promoted into a management position are limited. 68.8 4.7 25 1.6 0

e. There is a clear link between my performance and 

recognition of it. 59.4 20.3 18.8 0 1.6

f. Current performance incentives are effective tools 

to motivate employees to perform well. 18.8 18.8 59.4 1.6 1.6
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 74 GAO-13-621 SEC Personnel Management

12. To what extent do you agree or disagree with the following statements 

regarding SEC’s current performance management system? (Select one 

response per item.)

Strongly 

Agree/ 

Somewhat 

Agree

Neither 

Agree or 

Disagree

Strongly 

Disagree/ 

Somewhat 

disagree

Do Not 

Know

Not

Checked

a. SEC’s 5-point rating system allows for an accurate 

representation of my performance over the rating 

period.

50.0 7.8 31.3 10.9 0

b. How competencies are weighted accurately reflects 

the relative importance of my work. 32.8 20.3 34.4 9.4 3.1

c. How competencies are weighted accurately reflects 

the relative importance of my employees’ work. 31.3 15.6 46.9 4.7 1.6

d. SEC’s performance management system uses 

relevant criteria to evaluate my performance. 51.6 12.5 28.1 6.3 1.6

e. SEC’s performance management system allows 

supervisors and managers to have a meaningful 

discussion with their staff on how they are performing.

62.5 9.4 26.6 1.6 0

f. The time it takes me to develop, review, and 

formalize performance assessments under SEC’s 

current performance management system is 

unreasonable.

79.7 4.7 12.5 3.1 0

g. SEC’s performance management system provides 

consistent standards for rewarding performance. 43.8 25 29.7 1.6 0

h. Changes need to be made to increase 

transparency in the process used to rate my 

performance.

26.6 34.4 23.4 14.1 1.6

i. Calibration of performance ratings by management 

improves fairness in the performance management 

system.

71.9 9.4 17.2 1.6 0

j. Employee performance appraisals are fair and 

appropriate under SEC’s performance management 

system.

70.3 17.2 10.9 0 1.6

13. If there are any other issues, details, or information concerning 

performance management and promotions at SEC that you would like us 

to know about, please use the space below to provide this information.

We will not present detailed comments.
Appendix II: GAO Survey on SEC Personnel 

and Human Capital Management

Page 75 GAO-13-621 SEC Personnel Management

14. To what extent do you agree or disagree with the following statements 

regarding different aspects of organizational culture and climate within 

your division/office? (Select one response per item.)

Strongly 

Agree/ 

Somewhat 

Agree

Neither 

Agree or 

Disagree

Strongly 

Disagree/ 

Somewhat 

disagree

Do Not 

Know

Not 

Checked

a. There is an atmosphere of trust in my 

division/office. 73.4 7.8 17.2 1.6 0

b. Employee morale is generally high most of the 

time. 54.7 20.3 25 0 0

c. I have a voice in decisions that affect me and my 

work environment. 92.2 4.7 1.6 0 1.6

d. Senior officers in my division/office tolerate honest 

mistakes as learning experiences. 90.6 7.8 0 0 1.6

e. Protecting investors is sometimes hampered by 

staff or managers who view firms as places they can 

potentially work at in the future.

0 3.1 96.9 0 0

f. There are clearly defined policies and procedures 

for doing my work. 81.3 12.5 6.3 0 0

g. Innovative ideas are encouraged in my 

division/office. 92.2 4.7 3.1 0 0

h. Fear of public scandals has made SEC overly 

cautious and risk-averse.

62.5 12.5 25 0 0

i. In my view, the fear of being wrong makes 

supervisors and managers in my division/office 

reluctant to take a stand on important issues.

21.9 12.5 62.5 3.1 0

j. In my view, the fear of being wrong makes nonsenior officers and managers in my division/office 

reluctant to take a stand on important issues.

29.7 17.2 53.1 0 0

15. If there are any other issues, details, or information concerning the 

organizational culture or climate at the SEC that you would like us to 

know about, please use the space below to provide this information.

We will not present detailed comments.
Appendix III: Ratio of Staff to Supervisors and 

Senior Officers, Fiscal Years 2008-2012

Page 76 GAO-13-621 SEC Personnel Management

Section 962 of the Dodd-Frank Act requires us to review whether there is 

“excessive number of low-level, mid-level, or senior-level managers.” We 

did not find standards for evaluating “excessive” number of supervisors 

have not been established. Table 16 illustrates the ratio of supervisors to 

nonsupervisors. Table 17 illustrates the ratio of senior officers to 

nonsupervisors, and table 18 illustrates the ratio of senior officers to 

supervisors.

Table 16: Ratio of Supervisors to Nonsupervisors (per every 100 nonsupervisory staff), Fiscal Years 2008-2012

Supervisors to nonsupervisors

Division FY08 FY09 FY10 FY11 FY12

Division of Corporation Finance 24.1 23.2 21.0 26.8 23.4

Division of Investment Management 31.3 31.6 29.7 18.8 32.0

Division of Economic and Risk Analysis a 29.6 a 28.1 16.7

Division of Trading and Markets 23.6 23.0 23.9 24.4 18.8

Division of Enforcement 28.3 27.3 22.7 10.9 16.2

Office of Compliance Inspections and Examinations 33.4 33.1 30.2 28.4 35.3

Source: GAO analysis of SEC data.

a

There are no data for Division of Economics and Risk Analysis in 2008 and 2009 because the 

division was created in September 2009.

Table 17: Ratio of Senior Officers to Nonsupervisors (per every 100 nonsupervisory staff), Fiscal Years 2008-2012

Senior officers to nonsupervisors

Division FY08 FY09 FY10 FY11 FY12

Division of Corporation Finance 3.3 3.1 2.6 6.5 3.7

Division of Investment Management 6.3 6.1 5.9 3.1 6.0

Division of Economic and Risk Analysis a a 3.7 0 2.1

Division of Trading and Markets 7.5 6.2 6.7 4.1 6.1

Division of Enforcement 3.6 3.4 3.8 4.2 3.4

Office of Compliance Inspections and Examinations 3.1 3.0 2.9 6.1 3.8

Source: GAO analysis of SEC data.

a

There are no data for Division of Economics and Risk Analysis in 2008 and 2009 because the 

division was created in September 2009.

Appendix III: Ratio of Staff to Supervisors 

and Senior Officers, Fiscal Years 2008-2012
Appendix III: Ratio of Staff to Supervisors and 

Senior Officers, Fiscal Years 2008-2012

Page 77 GAO-13-621 SEC Personnel Management

Table 18: Ratio of Senior Officers to Supervisors (per Every 100 Supervisory Staff), Fiscal Years 2008-2012

Senior officers to supervisors

Division FY08 FY09 FY10 FY11 FY12

Division of Corporation Finance 13.5 13.2 12.3 24.3 15.8

Division of Investment Management 20.0 19.4 20.0 16.7 18.8

Division of Economic and Risk Analysis a 12.5 a 0 12.5

Division of Trading and Markets 32.0 26.9 28.1 16.7 32.3

Division of Enforcement 12.6 12.3 16.9 38.1 21.2

Office of Compliance Inspections and Examinations 9.4 9.1 9.5 21.3 10.7

Source: GAO analysis of SEC data.

a

There are no data for Division of Economics and Risk Analysis in 2008 and 2009 because the 

division was created in September 2009.
Appendix IV: Percentage of Staff Who Left 

SEC, Fiscal Years 2008-2012

Page 78 GAO-13-621 SEC Personnel Management

Among its provisions, Section 962 of the Dodd-Frank Wall Street Reform 

and Consumer Protection Act requires us to review turnover rates within 

SEC subunits.1

Table 19: Headquarters Staff Who Left SEC, Fiscal Years 2008-2012 

While staff turnover rates could be used to identify 

potential areas for improvement and further develop current supervisors, 

officials from the Merit Systems Protection Board noted that turnover was 

not a good indicator of poor supervision for several reasons. For example, 

staff may leave to pursue opportunities with a different employer or a 

different career path, or for personal reasons. SEC officials also indicated 

that staff facing potential removal or termination often would resign or 

retire, rather than going through removal or termination. Tables 19 and 20 

show the percentage of staff who left SEC from fiscal years 2008 through 

2012 from headquarters and the 11 regional offices, respectively. Table 

21 shows the total number of staff who left SEC during the same period.

FY08 FY09 FY10 FY11 FY12

Reason for 

separation

Employee 

category

Percentage 

separated

Total 

staff

Percentage 

separated

Total 

staff

Percentage 

separated

Total 

staff

Percentage 

separated

Total 

staff

Percentage 

separated

Total 

staff

Retirement Nonsupervisors 0.8% 900 0.2% 937 1.2% 1,008 1.8% 914 0.6% 1027

Supervisors 1.5% 196 0.0% 199 2.2% 224 2.7% 183 1.3% 234

Senior officers 0.0% 41 0.0% 40 8.7% 46 11.1% 45 2.0% 51

Resignation Nonsupervisors 4.4% 900 1.8% 937 2.1% 1,008 2.7% 914 4.0% 1027

Supervisors 3.1% 196 1.5% 199 1.3% 224 3.8% 183 2.1% 234

Senior officers 4.9% 41 12.5% 40 19.6% 46 8.9% 45 5.9% 51

Removal or 

termination

Nonsupervisors 0.4% 900 0.6% 937 1.0% 1,008 0.9% 914 0.7% 1027

Supervisors 0.0% 196 0.5% 199 0.0% 224 1.1% 183 0.9% 234

Senior officers 0.0% 41 0.0% 40 0.0% 46 2.2% 45 3.9% 51

Source: GAO analysis of SEC data.

 1

Pub. L. No. 111-203, § 962(b)(1)(F), 124 Stat. 1376, 1909 (2010).

Appendix IV: Percentage of Staff Who Left 

SEC, Fiscal Years 2008-2012
Appendix IV: Percentage of Staff Who Left 

SEC, Fiscal Years 2008-2012

Page 79 GAO-13-621 SEC Personnel Management

Table 20: Staff Who Left SEC from 11 Regional Offices, Fiscal Years 2008-2012

FY08 FY09 FY10 FY11 FY12

Reason for 

separation

Percentage 

separated

Total 

staff

Percentage 

separated

Total 

staff

Percentage 

separated

Total 

staff

Percentage 

separated

Total 

staff

Percentage 

separated

Total 

staff

Retirement Nonsupervisors 0.8% 927 0.4% 954 1.1% 981 1.2% 861 1.0% 987

Supervisors 3.7% 191 1.5% 197 5.0% 221 1.8% 168 1.7% 237

Senior officers 4.2% 24 0.0% 23 8.0% 25 4.8% 42 3.7% 27

Resignation Nonsupervisors 3.2% 927 1.2% 954 1.5% 981 2.8% 861 3.4% 987

Supervisors 1.6% 191 2.0% 197 0.9% 221 4.2% 168 1.7% 237

Senior officers 0.0% 24 8.7% 23 0.0% 25 2.4% 42 3.7% 27

Removal or 

termination

Nonsupervisors 0.5% 927 0.1% 954 0.3% 981 0.1% 861 0.8% 987

Supervisors 0.0% 191 0.0% 197 0.0% 221 0.6% 168 0.4% 237

Senior officers 0.0% 24 0.0% 23 4.0% 25 0.0% 42 0.0% 27

Source: GAO analysis of SEC data.
Appendix IV: Percentage of Staff Who Left 

SEC, Fiscal Years 2008-2012

Page 80 GAO-13-621 SEC Personnel Management

Table 21: All Staff Who Left SEC, Fiscal Years 2008-2012

FY08 FY09 FY10 FY11 FY12

Reason for 

separation

Percentage 

separated

Total 

staff

Percentage 

separated

Total 

staff

Percentage 

separated

Total 

staff

Percentage 

separated

Total 

staff

Percentage 

separated

Total 

staff

Retirement Nonsupervisors 0.8% 1,827 0.3% 1,891 1.2% 1,989 1.5% 1,775 0.8% 2014

Supervisors 2.6% 387 0.8% 396 3.6% 445 2.3% 351 1.5% 471

Senior officers 1.5% 65 0.0% 63 8.5% 71 8.0% 87 2.6% 78

Resignation Nonsupervisors 3.8% 1,827 1.5% 1,891 1.8% 1,989 2.8% 1,775 3.7% 2014

Supervisors 2.3% 387 1.8% 396 1.1% 445 4.0% 351 1.9% 471

Senior officers 3.1% 65 11.1% 63 12.7% 71 5.7% 87 5.1% 78

Removal or 

termination

Nonsupervisors 0.5% 1,827 0.4% 1,891 0.7% 1,989 0.5% 1,775 0.7% 2014

Supervisors 0.0% 387 0.3% 396 0.0% 445 0.9% 351 0.6% 471

Senior officers 0.0% 65 0.0% 63 1.4% 71 1.1% 87 2.6% 78

Source: GAO analysis of SEC data.
Appendix V: Comments from the 

Securities and Exchange Commission

Page 81 GAO-13-621 SEC Personnel Management

Appendix V: Comments from the 

Securities and Exchange Commission
Appendix V: Comments from the 

Securities and Exchange Commission

Page 82 GAO-13-621 SEC Personnel Management
Appendix V: Comments from the 

Securities and Exchange Commission

Page 83 GAO-13-621 SEC Personnel Management
Appendix VI: GAO Contact and Staff 

Acknowledgments

Page 84 GAO-13-621 SEC Personnel Management

A. Nicole Clowers, (202) 512-8678 or clowersa@gao.gov

In addition to the contact above, Triana McNeil (Assistant Director), Carl 

Barden, Bethany Benitez, Pamela Davidson, Simin Ho, Chir-Jen Huang, 

Catherine Hurley, Stuart Kaufman, Jonathan Kucskar, Tarek 

Mahmassani, Marc Molino, and Barbara Roesmann made key 

contributions to this report.

Appendix VI: GAO Contact and Staff

Acknowledgments

GAO Contact

Staff 

Acknowledgments

(250654)
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