Deloitte study shows companies want a culture focused on ethics and compliance
Firms want to integrate regulatory compliance functions and spread a culture of ‘doing the right thing’
2 November 2012
A new study from Deloitte, the business advisory firm, has revealed that over 90% of businesses want to see a cultural shift in the way they comply with regulations, such as those governing privacy and data protection, from ‘doing what they must’ to ‘doing the right thing’.
The report, A Path to Integration, shows that companies want to embed a culture where employees act ethically across everything they do and sets out the challenges – and benefits – of integrating their different compliance functions across the business.
Over 60% of companies surveyed said that this integration is an area that they will be focussing on in the next 12 months. As companies have reacted to each new regulatory challenge, the resulting compliance functions have operated independently of each other, wasting the opportunity for possible efficiencies. Integrating compliance across the business will allow companies to take advantage of these cost savings, as well as embed an ethical culture.
In recent years the UK has seen the introduction of enhanced regulations, such as the Bribery Act 2010, and a rapid rise in action being taken against firms under existing regulations like competition law. Global firms are also having to deal with different regulatory regimes in different territories. These factors and others have proceeded to push regulatory and ethical compliance right to the top of boardroom agendas. Encouragingly, the survey found that in nearly half (45%) of companies the compliance function reports directly to executive management. Such influence from the top level of management will be crucial in driving change and embedding a culture of ethical behaviour.
Tim Archer, partner in Deloitte’s Audit Advisory practice, said: “Overall the companies surveyed believed they are effective in complying with specific regulations, but they see the biggest challenge as creating an integrated approach to compliance. Such an approach is characterised by an organisation whose employees are driven to comply by values - “the right reasons” - rather than rules - “must do it” - and supported by frameworks that allow their organisations to ensure compliance whilst managing its cost. We believe the vision is possible and it is encouraging that we have seen compliance functions with the status to influence senior management. This high-level support will enable a top-down approach that will push the culture forward.”
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