Well, “two weeks to flatten the curve” in early 2020 has morphed into a two-year siege, and there’s still no end in sight. So, what’s been the impact on compliance? Let’s take a look.
Hybrid work models are becoming permanent. A Mercer study released in May this year found that 70 percent of companies plan to adopt the hybrid model. Full-time office jobs for most corporate groups, including compliance, are a thing of the past. How do workers feel about that? They’re delighted. FlexJobs’ 10th Annual Survey (conducted during July and August 2021) found that 97 percent of workers want some form of remote work. Compliance, like most corporate functions, is now a remote job.
Work-related travel isn’t happening. According to Deloitte, travel budgets at most U.S.-based companies are down 90 percent or more since early 2020. Two years ago, frequent trips for compliance were considered mandatory. Not today. “Essential travel” has been redefined — it’s mostly limited to meeting specific contract requirements — and companies have added “layers of executive approval” for booking flights. For compliance, that means in-person training and on-the-ground due diligence either aren’t happening or are now in the hands of local employees or consultants.
Supply chains are in tatters. CEOs are worried about chip shortages, vessel bookings, clogged ports, energy prices, and commodity supplies. How do we know? Bank of America reported that during this year’s Q3 earnings calls, mentions of supply chain issues were up 412 percent year-on-year. Supply chain disruptions raise compliance concerns too. As I said in a prior post, whenever buyers are scrambling for supply, sellers have opportunities to squeeze them. The “squeeze” often means more demands for bribes.
The labor force is unstable. McKinsey said in September that more than 19 million U.S. workers quit their jobs since April 2021, “a record pace disrupting businesses everywhere.” McKinsey’s research also showed that about 40 percent of employees “across industries and countries” are thinking of quitting in the next six months. What’s the turnover within compliance departments? That’s still unclear. But in other departments, employees who stay may have heavier job burdens and broader compliance responsibilities. Another way the Great Resignation impacts compliance is that trained employees are leaving and new, untrained employees are coming. As the knowledge gap widens, compliance departments will struggle to meet training demands.
Worker morale seems unmanageable. Since March 2020, the prevalence of anxiety and depression more than doubled in most OECD countries, including the United States. Few companies had mental health support beyond emergency measures when the pandemic hit. They weren’t equipped to help employees deal with the upset, exhaustion, and burnout that still plague workers today. Compliance professionals haven’t been immune. Many of us know, or know of, compliance pros who have either stopped work or left compliance for other fields. Beyond that, training workers with low morale usually doesn’t work. Lower morale means less engagement. That’s why compliance training methods and practices that worked yesterday might not work now.