Labor: An effective compliance policy can be the cheapest insurance a company can buy

Federal sentencing guidelines are harsher for companies without compliance policies

Our forefathers realized that angels do not govern men, and that rules were needed to successfully govern. Corporations are the same. While most employees and managers have good intentions, rules are needed to successfully run the business. In its 2011 National Business Ethics Survey, the Ethics Resource Center, which releases a survey of corporate ethical standards every two years, found disturbing trends that may require companies to step up their ethics and compliance policies.

The survey found that the percentage of employees who perceived pressure to compromise standards in order to do their jobs climbed five points from 2009, to 13 percent. While misconduct witnessed by U.S. workers declined from the 2009 survey, 45 percent of respondents still stated they had witnessed misconduct, and reporting of misconduct is now at near highs. The survey also found that employees working for organizations with effective compliance programs feel less pressure to compromise standards, see less misconduct, report misconduct more frequently and are not as likely to suffer retaliation for reporting.

Contributing Author

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Jeremy Hawpe

Jeremy W. Hawpe advises and represents employers in the health care, insurance, staffing, and transportation industries in a broad range of employment law matters. He...

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