Building trust with customers, employees, and stakeholders is important – but protecting yourself against ethics noncompliance is just as important. Noncompliance hurts the business in several ways such as loss of revenue, low consumer retention rates, and costly legal battles. The later hurts a business more in the long term, but there are steps to prevent these hurdles.
Steps to Prevent Noncompliance
- Start with a strong ethics program
- Encourage a culture of integrity
- Stay focused on the big and small pictures
- Constantly grow and improve your program
Government agencies often regulate each corporate sector. From manufacturing to pharmaceuticals to restaurants, Uncle Sam tells us all what we can and cannot do. Companies that fail to follow these guidelines often face hefty penalties or, even worse, loss of business license. Executives must protect their company by ensuring all internal and external regulations are followed to the letter.
Start With A Strong Ethics Program
Before you can ensure an ethics and compliance program that adheres to the set standards, you must first identify your needs and legal requirements. Recent studies show that creating an ethics and compliance program will reduce the temptations to violate guidelines and decrease reports of misconduct, while increasing employee reports of violations.
Building a Strong Ethics Program
- Create detailed guides
- Train your team and update regularly
- Provide resources to supplement training
- Methods to report violations (i.e. whistleblower program)
- Performance evaluations
- Disciplinary system
If companies commit resources to an ethical program, it helps reduce noncompliance and builds trust. These programs advocate a “big brother” atmosphere without pressuring the employees.
Encourage A Culture Of Integrity
One fact stays with us past childhood – the desire to fit in and be part of the team. The same goes for ethics. We want to “do” what others are doing. Creating a culture that promotes the right way and educates employees about the wrong way will instill a team spirit. Building a positive culture designed to nurture team work and encourage strong ethics isn’t enough. Companies need to weed out the negative.
Start by evaluating the performance and team spirit. Ask yourself questions about each person. Do they work with others to improve the company? Are they following the SOP? Do they take shortcuts to get work done faster and impress the boss? Do they encourage other team members to follow their example? For those who don’t meet your program standards, retrain them or remove them from the team.
Stay Focused On The Big And Small Pictures
Choices are like bank accounts. Each transaction impacts the overall budget. Ethics are the same. There are no big or small decisions. Each violation adds up and hurts the business. Encourage teams to keep the company’s values in the forefront. There should never be a case of “I forgot that one.”
Encouraging values retention
- Reward systems
- Recruiting process
- Performance evaluation
- Promotion decisions
Constantly Grow And Improve Your Program
Like a child who grows into adulthood, all business situations change and so should its ethics program. Evaluate your program each year or include it with your ISO 9001 or similar audit. Auditing the system and seeing what works and what doesn’t will help you make improvements. Employees who know the boss is evaluating the program are more inclined to follow the rules. This doesn’t mean micromanagement. It’s just an encouragement.
Ethical Advocate helps businesses protect their company by providing hotline solutions and training. Learn more about how a whistleblower program can save your company money.