Building a World-Class Compliance Program: Best Practices and Strategies for Success

Chapter 2. Tone at the Top and Throughout

"If ethics are poor at the top, that behavior is copied down through the organization."

—Robert Noyce, inventor of the silicon chip

The road to compliance starts at the top. An organization's entire culture is largely guided by senior management. The leadership sets the tone for the rest of the organization, and the culture reflects their actions, whether positive or negative. This is the often-mentioned "tone at the top." Employees pay careful attention, whether consciously or not, to their leaders and their actions. They can tell when a CEO truly supports the mission of the company or if the words are merely empty rhetoric. They hear what he or she says, and more importantly, see what he or she does. Employees look around their offices and understand their culture, even though it is not something that can readily be explained or easily put into words. Employees know if small transgressions are overlooked so long as financial goals are met, or if management is weak on ethics. Lax attitudes about ethics will prevent an organization from being able to achieve a culture of compliance.

A compliance program cannot operate with full efficiency and effectiveness in an environment that is not conducive to strong ethics. A negative ethical corporate culture is anathema to compliance. Of course, it should be noted that the objectives of running an ethical company that fully meets its compliance requirements, and running a successful and profitable company ...