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The Place for Ethics in Organizations by MIT Sloan Management Review

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The Trouble With Corporate Compliance Programs

Companies with rigorous compliance programs hope such programs will curtail employee wrongdoing. But to prevent employee misconduct, companies also have to understand how employees reach unethical decisions — and what affects their decision-making processes.

Multinational corporations spend millions of dollars per year on compliance. In highly regulated industries such as health care and finance, large companies spend much more, sometimes hiring hundreds or even thousands of compliance officers at a time.1 Siemens AG reportedly spent more than $1 billion on an internal investigation related to a government inquiry into the company’s payment of foreign bribes.2 But the ...

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