Mike Volkov, in a blog post entitled “Mood in the Middle Versus Tone at the Top”, said, “Even when a company does all the right things at the senior management level, the real issue is whether or not that culture has embedded itself in middle and lower management.  A company’s culture is reflected in the values and beliefs that exist throughout the company.” To fully operationalize your compliance program, you must articulate the message of ethical values and doing business in compliance and then drive that message from the top down, throughout your organization.

The Evaluation of Corporate Compliance Programs – Guidance Document (2019 Guidance) made clear a company must have more than simply good ‘Tone-at-the-Top’; it must move down through the organization from senior management to middle management and into its lower ranks. This means that one task is to get middle management to respect the stated ethics and values of a company, because if they do so, this will be communicated down through the organization. The 2019 Guidance stated:

Shared CommitmentWhat actions have senior leaders and middle-management stakeholders (e.g., business and operational managers, finance, procurement, legal, human resources) taken to demonstrate their commitment to compliance or compliance personnel, including their remediation efforts? Have they persisted in that commitment in the face of competing interests or business objectives?

This requirement speaks to the greater role of non-compliance functions in fully operationalized compliance program. Indeed, one sign of a mature compliance and ethics program is the extent to which a company’s other corporate disciplines are involved in implementing and then taking forward a compliance solution. This approach can act as a lynch pin in spreading a company’s commitment to compliance throughout the employee base. It can also be used to ‘connect the dots’ in many divergent elements of a corporate compliance and ethics program.

Three key takeaways:

  1. Tone at the top – direct supervisors become the most important influence on people in the company.
  2. Give your middle managers a Tool Kit around compliance so they can fully operationalize compliance.
  3. Organizational justice is an additional way to help operationalize compliance.