your company may well pay a steep price. And, you may
well pay that price personally if others in the company fail
to comply with any of the rules governing corporate financial practices.
(For a startling account of one CFM’s professional and personal struggle due to the unethical behavior of others in his company, see “You Are Closer to Being
Indicted Than You Think . . .” by an
anonymous author in the January/
February 2007 issue.)
While it’s true that you and your employees need to know
and follow the rules, it’s also true that rules don’t cover every
situation. In companies with a strong culture of ethics based
on core values (as opposed to companies where employees
simply follow the rules), people know what to do when there
isn’t a rule to follow.
In our rush to keep compliance at
the forefront, an interesting and unfortunate distortion can develop.
Namely, even though we routinely
talk about ethics and compliance as
if they are one and the same, we’ve
forgotten that these two areas are
On the other hand,
ETHICS are the
as well as
An exclusive focus on compliance
almost inevitably leads to a sole emphasis on rule enforcement. In that
environment, employees often hear
about the need to change their behavior only after a rule has been broken.
And, once rules are broken, the legal,
PR, and financial liabilities can be
worrisome at best – and catastrophic
Compliance, as the name suggests,
entails following the rules (or not)
and the consequences of our choices.
On the other hand, ethics are the values that underlie our behavior, as
well as the moral guidelines for our
As the old expression goes, “Ethics
are the rules we follow even when no
one else is looking.”
As the old expression
goes, “ETHICS are
the RULES we
when NO ONE else
Helping your employees identify and
use their “moral compasses” all day,
every day, will go a long way toward
preventing such catastrophes. And,
it’s more effective and efficient than
cleaning up a mess after it occurs.
Illegal activity in your professional
role as a CFM is unethical virtually
by definition. However, if you forget
that ethical behavior includes more
than simply following the rules, then
you’ve set a subtle trap for yourself and your company.
Assist with Compliance
A persistent and effective focus on
ethics and core values will actually aid
your compliance program. If you and
your staff pay attention to values in
addition to the rules, more employees
will do the right thing more often.
The Benefits of Ethics First
But, how can a focus on following the rules be even remotely
dangerous? After all, we grew up learning that attention to
rules is central to doing the right thing! Paying less attention
to rules sounds pretty ridiculous, even if the world were not so
Virtually by definition, a values-driven
approach adds a whole other layer of
power to your compliance program because values-driven
employees are more likely to make ethical choices. “Doing
the right thing” will simply be a part of your company’s values system – behavior which is trained, modeled, and reinforced from the date of hire.
However, you will see that when a company emphasizes ethics
first, it reaps many benefits, including an improvement in the
quality of employee reasoning, problem prevention, and ultimately, compliance.
When employees understand that both acting in accordance
with company values and following the rules will help make
them and the company more successful, they are much more
likely to do as they should.
Rule Keeping Restricts Thinking
Everyone in your company needs to pay constant and acute
continued on page 44