The value of ethics and compliance in a pandemic

COVID-19 RESOURCE HUB  |  Financier Worldwide

COMPLIANCE & ETHICS

The COVID-19 outbreak has forced companies to reassess their priorities in many areas. As organisations begin to reopen and prepare for a new normal, there will be compliance and ethical challenges to address.

The pandemic is, of course, first and foremost a health and safety crisis. Companies must have policies and procedures in place to protect employees, enshrined in their ethics and compliance programme.

Beyond this, COVID-19 has clearly caused significant financial stress for companies and employees across all sectors. It has stretched supply chains to breaking point and changed working patterns and practices for millions.

It would be easy for businesses, in these times of uncertainty, to overlook their ethics and compliance obligations.

Compliance teams will be vital. They are problem solvers that will add value as companies attempt to navigate their new risk environment. But they may also be hampered by staff shortages or office closures.

Current working conditions can compromise normal monitoring procedures, which increases the likelihood that employees and third parties could behave in a non-compliant fashion. This may include, for example, bypassing product quality checks or falsifying records to meet targets. With the compliance team strained, such actions could slip through the net.

It is imperative that companies continue to provide oversight, training and risk assessments across their business operations, even though these processes may be complicated by travel restrictions and lockdown orders.

Communication is needed to support compliance. An ethics and compliance portal, for example, can provide updates on action plans to address the pandemic, relay guidance from official sources and inform employees of changes to company policy.

Employees and third-parties need to understand that nothing has changed from a compliance perspective; standards cannot be relaxed and breaches will not be tolerated.

New measures, such as hotlines, may be required to allow employees to report any suspicions of misconduct within the organisation. Video conferencing software may then be needed to carry out further investigations and interview employees.

Of course, for compliance teams, like all other departments, there are many unknowns, and it is impossible to reasonably predict what will happen in the months ahead.

For most organisations, the COVID-19 outbreak has meant that business cannot continue as usual. Supply chains will be disrupted and risk profiles will change as the pandemic evolves.

Companies will need to be flexible, adapt to sudden industry and market movements, and shift their strategic vision when necessary – all while upholding ethical and compliant principles.

Companies should be highlighting the value of compliance and reinforcing an ethical culture to avoid exacerbating the financial impact of the crisis. Times are tough enough without inviting legal repercussions or reputational damage caused by non-compliant or fraudulent activity.

© Financier Worldwide

BY

Richard Summerfield