By Ruth Steinholtz and Ben Wilberforce-Ritchie
Originally published in Ethikos, Volume 38, Number 4, October 2024
In a thought-provoking discussion, Ruth Steinholtz, founder of AretéWork LLP, and Ben Wilberforce-Ritchie, Chief of Staff to the Group HR Director at BAE Systems, explore the fundamental differences between ethics and compliance in corporate environments. This conversation underscores the importance of striking a balance between the two to foster both adherence to rules and the development of a values-based culture.
Purpose and Context
The article addresses a critical question for modern organisations: how can businesses move beyond a rules-driven compliance approach to nurture ethical thinking, decision-making, and a culture where employees are empowered to “do the right thing”? As compliance programmes often focus on risk mitigation, ethics broadens the perspective to encompass values, culture, and sustainable practices.
Key Highlights
- Definitions and Roles:
- Compliance focuses on preventing and detecting breaches of laws and policies through rules, procedures, and monitoring.
- Ethics emphasises critical thinking and equipping employees to navigate dilemmas by aligning actions with authentic corporate values.
- Balancing Compliance and Ethics:
While compliance ensures structure and accountability, it risks becoming a “tick-the-box” exercise that stifles initiative if not balanced with ethical principles. Ethics enhances compliance by encouraging open dialogue, questioning, and a psychologically safe culture. - Values and Culture:
Authentic organisational values should guide behaviour, reducing the need for excessive compliance mechanisms. The authors caution against values that, without careful consideration, may unintentionally encourage unethical behaviour. - Whistleblowing vs. Open Culture:
A compliance-heavy approach often relies on whistleblowing mechanisms. Ethics focuses on creating a culture where employees feel safe to raise concerns proactively, fostering trust and collaboration. - Ethical Training:
Ethical training develops judgement and adaptability, helping employees navigate complex scenarios where rules alone are insufficient. It shifts the focus from “what is allowed?” to “what is right?” - Structural Considerations:
Organisations must align compliance and ethics without creating silos. Independent ethics functions, supported by leadership and collaboration across departments, are crucial for fostering accountability and systemic improvement.
This dialogue provides practical insights for organisations of all sizes to rethink their approach to ethics and compliance, ensuring that both elements support—not undermine—each other in pursuit of better business outcomes.
Read the full article here: Ethikos Volume 38, Number 4. October 01, 2024