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Compliance Officers: Management views compliance programs merely as a “regulatory requirement”

Ethics and compliance officers aren't on the same page as management.

More than 40 percent of ethics and compliance professionals say management thinks ethics and compliance programs exist merely to meet a regulatory requirement.

Compliance professionals mostly agree that promoting an ethical culture is the primary goal of a corporate compliance program, according to a recent report.

There’s just one problem: Their companies’ top brass view compliance programs as a box to check to appease regulators, they say, rather than an essential program to promote a positive corporate culture and root out fraud.

The report, a joint effort from the Society of Corporate Compliance and Ethics and the Health Care Compliance Association, surveyed members of the group to find out what they thought was the main goal of the ethics and compliance programs they run. They were then asked what they think management and the board of directors at their company though their main purpose was.

Nearly half (49.5%) of responders said their main job was to “promote an ethical culture.” The next largest group (35.4%) thought their primary objective was to “prevent and detect misconduct.”

That’s in stark contrast to how they feel upper management views their role. Of the ethics and compliance professionals surveyed, 42.6% said management thought the primary objective of their compliance program was simply to “meet a regulatory requirement.”

This attitude toward compliance is one reason whistleblowers seek out a whistleblower lawyer to report fraud and other wrongdoing to the government.

Most whistleblowers try to use internal channels to report misconduct before going to the authorities. But when there’s a corporate culture where compliance programs are merely perceived as a checkbox to appease regulators, real concerns often get ignored – or worse.

“Likewise it is troubling that management is seen as viewing compliance primarily to meet external requirements,” the report said. “This suggests that management may not be fully bought into the value of compliance program for protecting the business and serving as an extension of the company’s commitment to its values. This attitude likely furthers a belief in workers that compliance is a chore designed to meet the expectations of outsiders and does not reflect an internal commitment by the business.”

When management sees ethics and compliance measures as a nuisance, that is how those who raise concerns can expect to be treated.

But it will always be much more than a nuisance – and ultimately more costly – for managers to push employee concerns to the side rather than dealing with the problem head on. Litigation that can result from a whistleblower complaint can take years and cost millions of dollars.

“It is disturbing that compliance and ethics professionals see themselves, their managers and boards having different primary goals for their compliance program,” the report concludes. “In an ideal world, all three would have the same perspective.”

Check out some more data from the report:



compliance officer whistleblowers

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