10 Reasons Compliance Programs are Failing


Attorney Andrew Hayward and award-winning writer Tony Osborn have authored a new book, “The Business Guide to Effective Compliance and Ethics: Why Compliance isn't Working - and How to Fix it.” In the book, the pair make note of increasing regulation and enforcement actions; growing ethical demands from business stakeholders as well as the public; and more stringent compliance policies and procedures within organizations.  

 But they say, systematic non-compliance and often the misdeeds of just a few employees are still having a substantial negative impact on organizations around the world. Hayward and Osborn outline the top ten reasons many corporate compliance programs continue to fail and how they can be overcome. They include: 

  1. Lack of leadership commitment and/or credibility; 
  2. No leadership accountability when it comes to compliance;
  3. Compliance programs which only address the bare legal minimum; 
  4. Programs with too many rules that an over-rely on employees to obey them; 
  5. Programs that aren’t "ethics- and values-driven;" 
  6. Compliance seen as an obstacle to doing business; 
  7. Deliberate skepticism by employees who undermine compliance policies; 
  8. Compliance professionals seen as auditors or the police versus business partners; 
  9. Willful dishonesty, often for self-enrichment, by a small minority; and 
  10. Incentives not aligned with compliance objectives. 

That last one is perhaps not least in terms of the impact it has a compliance program’s success say Hayward and Osborn. To learn more about their new book, read a recent article on it in the FCPA Blog.