Tips on Using Compliance Culture as a Key Measure of Program Effectiveness.

Date posted: October 4, 2017

Compliance culture is the set of shared attitudes, values, goals, and practices that characterizes an institution or organization when it comes to compliance with laws, regulations, rules, standards, the Code of Conduct, and institutional policies.  Regulatory oversight agencies, including the Department of Justice (DOJ) and the Department of Health and Human Services (HHS) Office of Inspector General (OIG) advise that compliance programs should promote a compliance culture that creates an environment less likely to have regulatory or enforcement problems.  This involves establishing a workplace environment where workplace members embrace and adhere to rules, regulations, laws, the company Code of Conduct, and their policies.  The DOJ and OIG frequently encounter organizations that lack in quality, commitment, and ethics, despite having a compliance program on paper.  Compliance Officers should, therefore, find means to evidence that their organization’s culture matches the compliance goals.

Although compliance activities should not constitute a ‘cost center’ for organizations, they can derive many positive benefits simply from their effort to create such an environment.  First, having a positive compliance culture promotes good business as these organizations are less likely to have liabilities arising from wrongful behavior.  Additionally, evidence suggests that compliance committed organizations are more efficient in their business operations.  Moreover, organizations experience less employee turnover when their culture promotes compliance.  In turn, employees exhibit greater commitment to compliance with applicable laws, rules, the company’s Code of Conduct and policies.  As a result, employees feel less pressure to compromise company standards to achieve company goals.  A strong compliance culture thus provides employees with more empowerment to report wrongful behavior and misconduct internally, not externally.

Compliance Culture Surveys

Compliance experts regularly use Compliance Culture Surveys to evidence compliance program effectiveness.  Indeed, one of the best and most inexpensive methods for evaluating, evidencing, and benchmarking compliance program effectiveness is using a Compliance Culture Survey that measures employee perceptions of ethical culture and/or the compliance program.  The OIG recommends the use of surveys in their Compliance Program guidance, noting that, “as part of the review process, the compliance officer or reviewers should consider techniques such as using questionnaires (employee surveys) developed to solicit impressions of a broad cross-section of employees and staff.”  Professionally administered survey results provide a very powerful and credible report to the organization’s compliance oversight committees, as well as to any outside authority questioning the program.  Compliance Culture Surveys can identify relative strengths in the compliance program and those areas requiring special attention.

The OIG notes that “the existence of benchmarks that demonstrate implementation and achievements are essential to any effective compliance program”.  Compliance Culture Surveys can, therefore, also be used to meet this standard in two ways.  First, if the survey being used is anchored in a database of survey users, the organization can benchmark their survey results against that universe.  Second, an initial survey can establish a baseline from which future surveys can be used to benchmark compliance program progress.  Compliance experts recommend alternating between the use of Compliance Culture Surveys and Compliance Knowledge Surveys that test employee knowledge of the compliance program.  Compliance Culture Surveys should not be conducted annually, however, as significant changes in culture take time to show results.

Among its many benefits, a Compliance Culture Survey can:

  1. Provide critical evidence in determining the degree of compliance program effectiveness;
  2. Evidence compliance program effectiveness in improving the company’s compliance culture;
  3. Signal both compliance program strengths and potential weakness warranting attention;
  4. Evidence the extent of individual and leadership’s commitment to compliance;
  5. Assess the current state of an organization’s compliance climate or culture;
  6. Communicate a strong positive message to employees that what they believe and understand is important;
  7. Underscore organization commitment to employees;
  8. Signal to employees that their input is being used to make positive changes;
  9. Increase management attention on what is being measured;
  10. Provide metrics to measure the progress in developing an effective compliance program;
  11. Benchmark compliance program effectiveness improvement;
  12. Signal the organization to employee attitudes and perceptions; and
  13. Provide guidance as to where improvements are required.

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