Compliance Glossary

Culture of Compliance

What is a Culture of Compliance?

A company has a compliance culture when compliance is a central and unalterable part of the corporate culture. However, this doesn’t happen overnight. For an organization to have a strong culture of compliance, ethics have to be present at every level of the company. 

What is a Good Compliance Culture?

In a good compliance culture, compliance is a focus of management and is integral to company operations. An organization with a strong compliance culture has a general awareness of compliance best practices and the risks associated with non-compliance. 

A good compliance culture encourages and potentially even incentives good behavior through bonuses or requires it as a prerequisite to promotions. These activities serve as reminders to employees (and the third parties you work with) that compliance matters to the organization and is required for them to be successful at the company. 

However, compliance culture goes beyond following the proper due diligence procedure, taking your training, or reporting suspicious behavior. A strong culture of compliance is about infusing ethics into an organization’s operations. It’s about weaving doing the right thing into the existing culture at your company. 

How Do You Create a Culture of Compliance?

Building a culture of compliance starts with the organization’s mission, vision, and values. These are the company’s pillars and the standards that every employee and new hire should be held to. Culture is not tangible, but instead is something that is embedded within the people of an organization and upheld by top executives. 

The behavior that top executives display, often referred to as the ‘tone at the top’ sets the standards that will trickle down through the rest of the company. If executives are often seen cutting corners, encouraging growth at all costs, and bending the rules, that is how the employee base will begin to act. On the other hand, if your leadership team emphasizes ethics, calls out good behavior, and doesn’t tolerate bending the rules, the organization will adopt similar practices. 

Creating a culture of compliance rests upon a few common threads:

  1. Senior leadership communicating the importance of ethics and compliance 
  2. Managers being trained on common risks to the organization and how they can help keep the organization safe 
  3. Implementing policies that emphasize values and trainings that present relatable scenarios 
  4. Empower your employees to be compliant with tools that make doing compliance activities easy and straightforward 
  5. A robust compliance program that spans due diligence, whistleblower hotlines, conflicts of interest, and gifts & entertainment 
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