Culture has always been fundamental to determining how an organization operates. Recently, however, the topic of culture has moved to the top of the agenda for regulators, investors, and consumers. Regulators have come to realize that that without a culture of integrity, organizations are likely to view their ethics and compliance programs as a set of check-the-box activities.
Organizations understand that culture is one of the biggest determinants of how employees behave. Strong cultures have two common elements: there is a high level of agreement about what is valued, and a high level of intensity with regard to those values. Organizations with strong positive cultures create trusting relationships with stakeholders and investors and—in turn—stakeholders and investors trust the organization and the brand.
Given the increasing regulatory focus on fostering an ethical culture, organizations are conducting assessments leveraging internal and/or external resources to review programs to ensure both ethics and compliance are addressed. When it comes to developing world-class ethics and compliance programs, the starting point is a positive culture of integrity.
Culture and conduct are lenses that surface the drivers of undesirable behavior & detrimental outcomes and embed conduct in their enterprise-wide risk management framework and decision making process. How is your organization assessing and influencing ongoing shifts in culture and ethics?
As organizations gain a better understanding of the misconduct taking place in their workplaces, the focus shifts from detective and preventative capabilities to the role that culture plays in the proactive and persistent identification, mitigation, and management of risk.
Interested in more? Read the Deloitte Center for Regulatory Strategy’s Innovation in risk management: Canadian regulatory outlook for financial institutions in 2018.
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