Compliance is about ethics, integrity, and shared values. If you focus on these, you’ll definitely end up with an effective compliance system, right? Wrong! While the right intentions may be there, compliance can end up being ineffective and therefore a huge waste of time for companies. What’s true for every company department is also true for compliance: to make a difference, you must be effective. Below are 5 ways compliance programmes could be wasting time (and tips on how you can turn things around).
1. Your Compliance Programme Does Not Have a Goal
Your company has goals. You have goals. So, should your compliance programme have goals? Absolutely.
In organisations, time and resources are finite – prioritisation is essential. For example, what would you prioritise – launching new anti-corruption training in China, or implementing a new risk assessment system for the whole company? You decide: what’s more important? What will help your company the most? How fast can they be implemented? It’s important to engage with stakeholders in your company to define your priorities and then make a plan.
Obviously, not everything can be done at the same time as that may result in underperforming in key areas or misallocating resources for too many initiatives (both human and monetary). Defining goals is key – for this year, for this month, maybe even for today. Realistically, plans need to be flexible but the risk of not defining goals and benchmarks is being reactive and therefore not focusing on what really matters to the organisation. This can have negative consequences – for your compliance organisation, for your company, and for you personally.
Have you already defined the goals of your compliance programme?
2. Your Company Culture is “wrong”
There is no such thing as a “wrong” company culture, you may argue – and you’re right. But company culture is an integral part of compliance. “Tone from the top” is key. It can be boiled down to one basic idea: if your compliance function is trying to foster ethical behaviour and integrity, but your CEO is saying to managers and other employees that they need to achieve 30 percent revenue growth per quarter at any cost – you may find yourself running into problems down the road. Conflicting messaging and goal disparity could result in compliance measures being set up to fail.
What can you do to mitigate this potential tension? Getting executives and management on board cannot be underestimated – ideally, they should already be. In reality, we know that many executives can be sceptical about the compliance function. If necessary, you might need to take the time to demonstrate to them how an effective compliance management system contributes to the company’s success.
3. You Forget About the “Why”
New regulations are probably flooding your desk. It’s easy to get caught up in the constant struggle of just making sure your organisation is aware of what the requirements are right now – just ticking the box of basic compliance.
But, try not to forget the “Why”. Why it is important for the company to be compliant, to have common values, to define a culture for itself. Again, it comes down to ensuring that your organisation understands that compliance is not just about ticking boxes and getting documents signed. If you forget about the “why”, your colleagues may see compliance as the company’s spoilsport, hindering business from its true potential. Make sure you know your “why” to help define your compliance programme. You help create a culture that employees can identify with, you prevent the company getting a bad reputation and you save the company from exorbitant fines. Ensure that everyone is aware of the value that compliance adds to the organisation.
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Every company has them: policies, guidelines, rulebooks that no one ever sees or reads.
4. You Create Content That No One Reads (Or Understands)
Every company has them: policies, guidelines, rulebooks that no one ever sees or reads. Or, when employees have read them, they haven’t understood a word. When creating and communicating a policy, a compliance team has two options: sticking as close to the law as possible, using dry legal terminology and phrases, resulting in a 27-page document and lots of frustration for employees (because they don’t understand and are not engaged). Or, you can try and empathise with the people you write the policies for, thinking about how to make these materials as easy to understand and engage with as possible. What is likely to have more impact?
Creating something easily-understandable within a legal framework can take a lot of work to create. Often, writing a 200-page textbook of material may take a long time, but it’s not necessarily difficult. Trying to pare down this content to highlight the five most important points is a real challenge. But, to achieve your compliance goals and guidelines, it’s worth it. When you’re writing the next policy or guideline, try to think about this: if employees will only take away one piece of information, what should it be? If you need some inspiration for “short and sweet” compliance communications, check out General Motors’ dress code policy.
5. You’re Tracking the Wrong KPIs (Or, No KPIs at All)
Measuring compliance efficiency is difficult. How can you measure things like “integrity”, “behaviour”, or “ethics”? Good news – you can. It is first and foremost identifying which key performance indicators (KPIs) make sense for your organisation. Here are some ideas:
- Percentage of employees that have/have not completed compliance training
- Success rate of employees who took part in training
- Percentage of new employees who received all relevant policies within their first two weeks
- Number of reports about misconduct that came in through the whistleblowing system
All of these can be broken down into countries, companies, departments, categories, and so on. This allows you to get a very detailed picture of your compliance system’s effectiveness – otherwise you may have “blind spots” and not have any idea of whether your initiatives have any impact.
Tracking KPIs, however, is only the first step to improvement. It’s always good practice to track results: why is the success rate in a certain department poor? What can be done to ensure that new employees receive all relevant compliance information? Dig into the stats and ask questions. Be proactive and be curious – then, your KPIs will truly help improve your compliance management system.
Even though most of these points may seem obvious – in day-to-day work, it’s easy to lose sight of the bigger picture. So, remind yourself of what really matters, and how you can maximise the effectiveness of your compliance programme. This will ensure that both your team and your department remains an asset and indispensable for your company.