ECI Report Shows That the Size of an Organization Affects Reporting of Misconduct and Efficacy of Ethics & Compliance Programs Regardless of size, all organizations can benefit from an enhanced E&C program to temper pressure and misconduct.
Vienna, Virginia
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April 01, 2022 02:58 PM Eastern Daylight Time
The Ethics & Compliance Initiative™ (ECI™) has released a report that shows that ethics & compliance (E&C) programs operate differently in small- and medium-sized organizations compared to large enterprises. The strength of an E&C program is critical to decreasing the likelihood of misconduct, increasing reporting of misconduct and decreasing retaliation in an organization. The report - State of Ethics & Compliance in the Workplace, Differences between Small, Medium and Large Enterprises - outlined seven key findings, including that ethical culture strength is similar, regardless of the organization’s size; E&C program elements are increasingly embedded as organizational size increases; and employees at medium-sized and large organizations are better prepared to handle potential misconduct. Other key findings showed that – although all organizations can benefit from an enhanced E&C program to temper pressure and misconduct – medium-sized organizations have a more urgent need to develop their E&C programs if they are not already formalized.
“In medium-sized organizations that are transitioning to a large-sized enterprise, more employees feel pressure, and observe misconduct and perceive retaliation after reporting misconduct compared with employees in small- and large-sized enterprises,” said Evren Esen, ECI Vice President of Research & Analytics at ECI. "Medium-sized organizations often still have the advantage of being nimble, agile and more interconnected. They may need, however, to establish ethical practices and programs that are more sophisticated and have a broader reach.”
“ECI encourages organizations that are growing to be aware of a ‘tipping point’ at which informal ways of doing things give way to formal programming and support to help guide employees on workplace ethics standards and how to address wrongdoing,” Esen concluded.
The State of Ethics & Compliance in the Workplace, Differences between Small, Medium and Large Enterprises report examines data from the ECI’s Global Business Ethics Survey® (GBES®). Data from more than 5,000 employees in the United States were analyzed by the size of the enterprise in which they work (i.e., organizational staff size).
For the purposes of the report, small-, medium- and large-staff-sized organizations were defined by the following categories:
Small organizations: Fewer than 500 employees
Medium organizations: 500 to 999 employees
Large organizations: 1,000 or more employees
Results discussed include ethical culture strength and four major ethics outcomes that are connected to E&C program implementation: pressure, observed misconduct, reporting misconduct and retaliation. Additional comparisons are made to show the impact of a strong versus a weak ethical culture on ethics outcomes.
ECI will hold an ECI Live event during which E&C professionals will discuss the State of Ethics & Compliance in the Workplace, Differences between Small, Medium and Large Enterprises report. The event is scheduled for April 27, 2022, and panelists include Alistair Raymond, VP and Chief Compliance officer, AVANGRID; and Elizabeth Simon, VP of Compliance for FirstKey Homes.
Register for the event here.
The Business Ethics Resource Center (BERC), powered by U.S. Bank; and the Melrose & The Toro Company Center for Principled Leadership at the Opus College of Business at the University of St. Thomas in Minneapolis, Minnesota funded the report.
About ECI
Established in 1922, the Ethics & Compliance Initiative™ (ECI™) comprises the two oldest nonprofits in the ethics & compliance industry; the Ethics Resource Center® (d.b.a. the Ethics Research Center) and the Ethics & Compliance Officer Association (d.b.a. the Ethics & Compliance Association).
Through its research, ECI identifies the practices that improve ethics & compliance program effectiveness and build institutional culture strength. As an association, ECI brings together ethics & compliance professionals and academics from all over the world to share techniques, resources and exciting new ideas. ECI also has an established track record of providing support to organizations seeking to transform their cultures, often in the wake of significant challenges with noncompliance.
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