The European Business Review

WHY FORGIVENESS SHOULD BE PART OF YOUR COMPLIANCE STRATEGY

Compliance strategies are integral in creating a trustworthy, high performing and innovative work culture. As such, it is imperative for companies to evaluate the effectiveness of their compliance especially in today’s complex business world. In this article, the author highlights the advantage of putting forgiveness a part of the compliance strategy as implemented by China’s giant telecom Huawei.

In the last two decades, the importance of having a compliance team in office has increased significantly. Several ethical failures that took place at Tyco, WorldCom, Enron, Royal Dutch Shell and Volkswagen – to name just a few – all have been widely publicised and discussed. Consequently, the existence of these numerous international scandals pushed towards a rise in regulatory requirements across industries. Despite the enormous number of articles published on the need for effective compliance in today’s business world, it is somewhat disappointing to notice that most organisations are nevertheless only undertaking minimum requirements to maintain compliance.

As many will say, compliance activities usually involve a tick box approach with the aim to leave a paper trail behind. Looking at compliance this way unfortunately reduces it to an activity relying solely on the use of laws and rules but never going beyond it. The result of such an approach is that work cultures are created in which employees are fearful to undertake any risky legitimate action and shy away from using sound ethical judgments – “better to be safe than sorry” (De Cremer, 2014). If anything goes wrong, the dominating response is one of blame rather than support and efforts to prevent wrong behaviour in the future. If these descriptions fit with how compliance works

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