ETHICS AND INTEGRATED ASSURANCE: THE CHALLENGE OF BUILDING ‘TRUST’
For many years, corporations (both private and state owned) have struggled to build long-lasting trust with society. Next to general scepticism of globalisation, and generation and distribution of profit, there is the perception that corporations lack ethical standards or are unable to consistently adhere to them.
Corporations are perceived from the outside as ‘monolithic’, but in fact consist of a group of diverse human beings working under a common brand. As an integral part of society, corporations must acknowledge the constant tension between the human element and unified corporate behaviour. This means that building trust will always be a challenge – but that is no excuse to avoid addressing the root causes of corporate misbehaviour.
So, how can leaders best prepare their corporations to maintain compliance with laws and regulations, and manage reputational risks in areas of concern to society?
The answer, especially for multinationals in recent decades, has primarily focused on building a compliance programme around the three pillars of preventing, detecting and responding to misconduct. These programmes were typically implemented in regulated areas with a higher risk of significant fines, loss of business licence or debarment. Examples include anti-bribery, antitrust, anti-money laundering, health, safety, the environment and, more recently, data privacy compliance. In some corporations, implementation followed a thoughtful risk assessment process; in others, it happened reactively, driven by a public scandal or a major investigation by enforcement authorities.
Apr-Jun 2024 Issue
Novartis