Having the right corporate culture is essential to an effective compliance program, but building and assessing that culture can be a very tricky thing. Few know this better than Jeffrey Kaplan, a partner in the firm Kaplan & Walker, who specializes in compliance program assessments.
There is an eagerness, he explains to measure the culture, but doing so in a quantitative way can be difficult. Some things just don’t lend themselves to a numbers-based score. In those cases it’s best to rely on common sense born of experience.
What should compliance teams look for when assessing culture? He recommends examining several factors including:
- Tone at the middle
- How easy it is to speak up in the organization on all issues, not just compliance
- Organizational justice
- How conflicts of interest are managed
- The industry’s culture
- How customers are treated
- Incentive plans
- Rule following
There is a lot of subtlety in these measures. For example, while on the whole it’s good to have a culture where the rules are followed, there could be a cost if ethics is not considered.
He also encourages granularity: don’t just look at the culture as a whole. It should be examined by geography and even department.
Listen in to learn more about how to better assess your own organization’s culture, or cultures, and the best way to present the findings to management.