How to Teach Compliance

Biking the California desert

When I lived in Montana a few years back, I discovered a passion for mountain biking. After numerous spills and flips over the handle bars, a seasoned mountain biker gave me a most valuable piece of advice: look in the direction you want to go. If you focus on the single-track in front of you, he said, you’ll stay on the track. If you are constantly looking at the ruts, he warned, you’ll unconsciously swerve that direction and probably find yourself landing on your back, again.

Over time, I discovered that this advice doesn’t just apply to mountain biking. Research shows that it is perhaps THE key to mitigating risk in a corporate environment.

Companies can approach compliance in one of two ways. First, they can focus on preventing illegal activities, i.e. describing and avoiding the ruts. While I’ve not worked at Boeing, a simple glance at their code of conduct indicates that this approach may dominate their compliance programs. The first two points of their code warns against major ethical ruts that Boeing has fallen into in the past decade: don’t engage in activity that is a conflict of interest and don’t take advantage of your Boeing position for personal gain. Certainly, it is important to know where the ruts are located. And in such a highly regulated industry, Boeing has a major challenge in simply mitigating risk.

Yet risk mitigation is far more effective when the programs are informed by an ethical framework that is broader than legal compliance. Thus, we turn to our second approach: promoting ethical values. According to the document, “Management Antifraud Programs and Controls,” that was compiled by leading accounting and anti-fraud organizations in the US, effective anti-fraud programs are values-based. The authors write:

Research suggests that the most effective way to implement measures to reduce wrongdoing is to base them on a set of core values that are embraced by the entity. These values provide an overarching message about the key principles guiding all employees’ actions. This provides a platform upon which a more detailed code of conduct can be constructed, giving more specific guidance about permitted and prohibited behavior, based on applicable laws and the organization’s values.1

Values-based programs are effective because they help employees keep their eyes on the track, rather than the ruts. They describe the direction that the company wants employees to go, rather than fixating on where not to go. Certainly, employees need to know where the ruts are—but in values-based programs, this instruction is part of a broader ethical framework that creates and reinforces a culture of integrity.

People want to be inspired by the values of an organization–values like innovation and integrity and global citizenship. When a company leads with values, those who share those values will jump on their bikes and pedal hard to stay on track.

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One Response to How to Teach Compliance

  1. Pingback: How Employees Become Ethical | Project CSR

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