Recently a small group of open-minded trust, ethics and compliance professionals met for an informal lunch in New York City to discuss the intersection of the three disciplines and their respective roles in organizations.
I was fortunate to be included among the attendees.
During the conversation a visual representation of the functional interaction between organizational compliance, ethics and trust began to take shape. It’s the image above.
While organizations require compliance as a minimum “rule setting/obeying standard,” compliance does not necessarily imply an ethics or a trust mandate. It is simply a starting point. At times, compliance can be the worst enemy of trust, particularly when it is assumed that compliance has ethics and trust “covered.”
Compliance is regulated while ethics and trust are voluntary. In most companies, the compliance and ethics officer, often an attorney whose function is simply to enforce the “laws,” does not make this distinction. He or she may have no understanding of ethics or formal training, and certainly none of trust as a business strategy or imperative.
The “character” component of trust is ethics, and unlike compliance, ethics is a personal and organizational choice, tied to a predetermined set of core values and embraced by the board of directors, not the CEO. A chief ethics officer may be the distiller of these values, and being an attorney is not a prerequisite for this position.
Unfortunately, both individuals and organizations can be compliant and ethical and yet still be missing the trust component, because there are two more attributes that must be present for trust to flourish.
In order for an individual or organization to be trustworthy it must at a minimum exhibit not only character (ethics) but competence and consistency in all internal and external relationships. “High trust” companies understand the distinction between compliance, ethics and trust.
Going beyond compliance and ethics by adding the trust component brings:
- Less need/emphasis on compliance and it’s seemingly oppressive laws and regulations
- Greater employee satisfaction and lower turnover
- Faster decision-making and innovation
- Less risk and fewer crises
- Better relationships not only with customers but all stakeholders
- A happier workplace
- Higher profits
- Long-term organizational sustainability
In Part Two, I’ll explain how organizations can evolve toward trust as a business strategy.
Barbara Brooks Kimmel is the CEO & Co-founder of Trust Across America-Trust Around the World (here), whose mission is to help organizations build trust. She’s also the editor of the Trust Inc. book series and the Executive Editor of Trust! Magazine.