The dawn of a new decade gives us reason to reflect on the events that have impacted the business landscape from a cultural, legal and regulatory compliance perspective. Importantly, the extent to which organisations take on board the lessons of the year gone will shape the operating environment in 2020.
Here are some of the key themes which have gained traction in 2019, and are likely to maintain momentum through the year ahead.
Governance by inquiry
If any one factor has defined the operating environment, it’s been the apparent deferral by the nation’s legislators to what might be termed ‘third-party governance’ – as seen by the increasing reliance on royal commissions, parliamentary inquiries and the like, to re-set the regulatory frameworks around various industry sectors. This has been driven by a raft of complex and increasingly prevalent issues relating to the conduct of businesses, large and small, and its leaders. The fallout from royal commissions within the banking, financial planning, and aged care sectors, to name just a few, has been profound. Each of these industries must now face significantly more onerous regulatory and legal compliance obligations, not to mention the glare of a less-trusting public, shareholders and media.
Fair day’s pay
The sudden rise in the number of large-scale underpayment scandals, driven in part by the complexity of the myriad laws and workplace agreements across different sectors, suggests we’ll see more of the same in the year ahead. From retail, to hospitality and the FMCG sectors, companies are on notice that appropriate investment in the right systems, resources and training is a non-negotiable if they’re going to do the right thing by their employees, their shareholders and by the law.
The rising incidence of sexual harassment cases in the workplace or, at least, the growing propensity for people to report such incidents, gained global traction over the past year through the #metoo movement. There’s been a fundamental shift in the dynamic to the extent that people are more empowered than ever to call out behaviours that only a few years ago were conveniently swept under the carpet, and to make offenders accountable for their actions – past and present. For leaders and executives across every industry sector, the message has become abundantly clear that turning a blind eye no longer cuts it – legally or morally.
Modern-day chain gangs
The Modern Slavery Act 2018 came into effect on 1 January 2019, signalling new reporting requirements for the operations and supply chains of large companies trading in Australia. The first reporting year, running 1 July 2019- 30 June 2020, will offer an initial view of whether or not corporates are complying with the legislation, or if many are still in catch-up mode when it comes to recalibrating systems, processes and training methods to ensure they aren’t caught short.
Blowing the whistle on protection laws
The introduction of new whistleblowing laws in 2019 saw Australia take significant strides forward in protecting whistleblowers within the private sector. The new laws are an essential part of ensuring integrity and accountability are cultures fostered within corporate Australia, while also acting to deter and expose fraud, misconduct and corruption. Companies need to update their policies to reflect the changes to the legislation, while making sure the policy is available to all people who may be eligible whistleblowers in relation to their company. Further, they must ensure that whistleblowers know where, when and how to report; and that their identity as a whistleblower will be kept confidential. The implementation of this legislation will have a massive impact on destigmatising the disclosure of wrongdoings and of companies ensuring they promote a ’speak up’ culture.
The marriage of culture and compliance
As a business that works with more than 300 companies in the provision of online compliance training services, we know that regulatory compliance and organisational culture are inextricably linked.
That is to say that companies whose culture is driven primarily by doing the right thing, are the organisations which invest in quality compliance training that enables its people to know how to do things right. It includes helping employees to understand the social, reputational and legislative implications of non-compliant behaviours. This, in turn, puts the onus on leaders to identify the skills and knowledge required by their teams to ensure the company operates within its legal, regulatory and social obligations.
The successful organisations of tomorrow will be those who are constantly evaluating the capability of their teams in the context of a rapidly changing regulatory environment. It will extend as much to professional skills through HR-led training and development initiatives, as it will the technical requirements of their industry sector.
And, of course, technology solutions such as AR and AI will have a huge impact in the delivery and embedding of compliance training for maximum effectiveness.
It will no longer fly for compliance to be a ‘check-the-box’ activity for risk, legal or HR departments. Instead, boards and senior management – at least those which purport to work to best-practice standards – will see compliance training as an investment in building and sustaining a culture built on integrity.
Deborah Coram, Safetrac’s CEO, will regularly share industry-relevant news to keep you informed on what’s happening in the world of compliance and brand protection.
As an authority on compliance training for almost 20 years, Deborah’s insights are thought-provoking, relevant and timely.