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Findings show that strategic buy-in from executive leadership is the critical driver for program effectiveness

PORTLAND, Ore., June 18, 2019 – Leading ethics and compliance software and services company NAVEX Global® today announced the release of its 2019 Definitive Corporate Compliance Benchmark Report. This document is the company’s first to consolidate findings about multiple E&C disciplines into a single, issue-based benchmark report. The disciplines covered in this unique publication include policy and procedure management, employee training, third-party risk management as well as hotline and incident management.

Report findings show that leadership buy-in to the strategic value of an E&C program has a profound impact and is the clearest driver of program success and the perception of organizational ethics. Organizations with strong executive backing show greater success, more program maturity and adoption of E&C technologies that improve program performance.

The report also found that program consolidation, automation and maturity are trending up. The advent of new technologies, purpose-built for E&C functionality with resource and time-saving automation and workflows, has allowed program leaders to focus on trend analysis and reducing known and emerging concerns before they negatively impact the organization and its stakeholders.

The report evaluated the maturity of each respondent’s program, classifying them as either reactive, basic, maturing or advanced. Importantly, program maturity levels were not self-reported. Rather the survey instrument identified maturity based on a subset of questions answered. Confidence that the organization is “always ethical” drops to only 25 percent among respondents with basic programs and a disappointing 15 percent for reactive programs.    

The report also shed light on respondents’ impressions of corporate culture and tone from the top. Among the most telling: Less than half (48 percent) of all respondents said their organization’s senior managers viewed E&C as part of a comprehensive risk management strategy that proves a return on investment. The remaining 52 percent felt that management considered E&C programs to be either an “insurance policy” or, worse yet, a necessary evil. And again, the numbers become more alarming among basic and reactive programs where respondents rated their management’s confidence in program ROI at 30 and 13 percent respectively.      

“These two sets of findings are clearly related,” said Carrie Penman, Chief Compliance Officer and Senior Vice President, Advisory Services, NAVEX Global. “It’s obvious to employees when leadership believes in the strategic value and measurable ROI of E&C programs. Leaders who view compliance programs as insurance policies or necessary evils – as many do, particularly within less mature organizations – are sending the wrong message to their workforce.”

The study also indicates that organizations are struggling to address issues that have dominated news cycles in recent years, including: harassment, bribery/corruption, conflicts of interest and data privacy/security. Though #MeToo is arguably the most forceful movement to hit the workplace in recent history, 48 percent of respondents said their organization has made no changes as a result.

“While this finding regarding #MeToo was disappointing, advanced programs fared better,” Penman said. “Advanced programs are better positioned to quickly respond to societal changes as well as cultural expectations and adapt by providing better training, stronger policies and, perhaps most important, a more open dialog.”

Other Key Findings:

  • Only 71 percent of respondents overall and 91 percent of advanced programs offered an anonymous reporting channel – something every organization should have at this point in the evolution of E&C programs.
  • Technology use is less common in small organizations’ programs and those at the low end of program maturity. However, it is one of the key drivers of a successful program. Overall, 85 percent of respondents currently use one or more automated solutions in their programs. Those that use up to five of these solutions demonstrate better prevention of violations and more program accomplishments as they add each automated solution.
  • Regarding policy and procedure management, 85 percent of respondents said a “centralized repository with easy access to the most current versions” was valuable or very valuable. More than three out of four (78 percent) rated “improved version control, reduced redundancy or increased accuracy of policies” just as valuable.
  • Budget and allocated resources are largely flat for most E&C programs, though one in five expects some modest budget increases. A third of organizations have a budget less than $50,000, and half have four or fewer FTEs dedicated to E&C.
  • Third-party risk management solutions lag in perceived value and implementation. E&C programs are depending mostly on proven, core program elements policies, codes of conduct, training and internal reporting systems – to help manage these risks.

About NAVEX Global
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