It seems that there is no shortage of scandals in the business news these days. Nokian Tyres just recently became the latest statistic, admitting that it cheated to achieve better test results over a number of years. And, Volkswagen and its management are still suffering the repercussions of its diesel emissions manipulation scheme. These events remind us that business is competitive, and management and employees alike are under constant pressure to meet ever increasing targets and expectations. The temptation to bend the rules get ahead is ever present.
Unethical behavior can cause serious reputational and financial damage to a company. It can also lead to personal liability for the company’s officers and directors. Therefore, in the wake these recent scandals, board members and top management should be asking themselves, “Am I confident that I know what is going on in our company? “Could something like this happen here?”
Wanting to believe that unethical behavior doesn’t occur in your organization is understandable. Unfortunately, however, the statistics do not support such a belief. To protect your company’s brand, reputation and value, you must be ready to ask the tough questions. And, you must instill and foster a culture of compliance and ethical behavior in your organization. To do this properly, you must first understand the risks your company faces.
This is why risk assessments should form the cornerstone of any effective compliance program. Risk assessments help you understand what risks you face, so that you can properly prioritize and address them. When properly conducted, they can also serve as a method of raising your employees’ awareness, and willingness to report concerns.
Business is constantly changing, and so too are the risks involved. Because of this, risks assessments need to be conducted on a regular basis and in a way that is best suited for the nature of your business and your risks. If you have not conducted an in-depth risk assessment recently, now may very well be the right time to do so.
Bradley Mitchell has advised multinational organizations in a broad range of legal and business capacities for over 18 years. Currently, Brad specializes in the area of Ethics and Compliance, helping companies to build, implement and improve their compliance programs. Brad’s expertise includes: conducting risk assessments, drafting compliance policies and procedures, implementing reporting hotlines, conducting and managing investigations, designing and providing training, and advising on best practices.