In the past decade, we have witnessed an alarming surge in scandals due to poor corporate culture in South Africa, we can look at Eskom, Steinhoff, Tongaat Hulett, Bosasa and VBS Bank etc as examples of poor corporate culture that lead to their breakdown . Such scandals arise from questionable business practices, misaligned priorities and a lack of ethical leadership.
A strong corporate culture pays off. It has been established that employees that highly regard their company’s corporate culture are more likely to align to this culture, and report any misconduct they observe. A positive corporate culture promotes better employee performance and engagement. A positive compliance culture is one that is ethics and values-driven, strongly aligned to regulatory compliance and is an essential part of a positive corporate culture.
A positive compliance culture has various advantages across the organisation:
- A positive impact on the productivity and morale of staff working in an environment that is aligned with aspirational values and ethics.
- Regulatory framework within which to conduct business.
- It builds trust with stakeholders, including shareholders, employees and the public.
- Leads to reduced risk and liability – leading to a reduction in cost.
- In an era where stakeholders are increasingly socially conscious, a compliance culture can be seen as a competitive advantage. Stakeholders (including clients) are choosing to do business with reputable organisations.
How to build a positive compliance culture:
- Policies and processes should be clearly documented, consistently applied and regularly updated to remain relevant.
- Policies and processes should be reinforced with training.
- Remove barriers to compliance: policies and processes should be easily accessible. Where possible tools such as automation or software should be used to simplify compliance.
- Top-down approach: a culture of compliance should be driven from the top. It should be implemented and supported by management.
In summary, a positive corporate culture is more than having a fun, collaborative work environment. A culture driven by values, ethics and compliance has many advantages for the business and all stakeholders.
Sources:
https://genesishrsolutions.com/peo-blog/how-to-ensure-compliance-in-the-workplace/
https://www.monitorqa.com/achieving-compliance-culture/
https://www.linkedin.com/pulse/role-leadership-tackling-compliance-issues-gopakumar-pillai/
https://www.gartner.com/smarterwithgartner/10-truths-compliance-must-know-about-corporate-culture