HR and ethics departments of global organisations are engaging in ongoing collaboration to make their companies’ corporate culture and risk management processes have an increased focus on ethics, according to a global report released by business research forum The Conference Board.
Although there is considerable sentiment for pursuing greater collaboration, only one-fifth of those surveyed regarded full integration of these departments as optimal. But most of the participants (77 per cent) said they would like to see a more collaborative approach than their company was currently taking.
The report is based on a survey of HR and ethics and compliance professionals of 214 global companies. It found that collaborative practices between these departments are strongest with regard to code of conduct and policy-writing, risk analysis, training and hotline maintenance. Less mutual support was found in situations where joint effort could help build a strong ethical culture – such as employee screening and compensation.
“Many CEOs and boards of directors recognise the critical contribution that a teaming between human resources and ethics and compliance can make towards an ethical corporate culture, especially in the areas of acquisitions, joint ventures and supply chain links,” said Ronald Berenbeim, principal researcher at The Conference Board and author of the report.
“But the fundamental requirement for collaboration is for both E&C and HR professionals to cultivate the necessary habits of mind with respect to recognition, analysis and resolution of ethical dilemmas.”
To achieve leadership support, human resources and ethics and compliance leaders needed to develop measures that enabled executives and board members to recognise the potential bottom-line impact of such collaborations, he said.
“Compelling metrics can tell an appealing story that will encourage executive leadership attention and oversight,” said Berenbeim.
Thirty per cent of the respondents cited different approaches to problem analysis as the key obstacle towards successful collaboration between the two departments, with 18 per cent citing potentially disruptive areas such as lack of mutual professional respect.
Nearly two-thirds of the survey participants provided examples of the benefits of working together in areas such as policy formulation, investigations, training and program implementation.
The study found that no single collaborative structure or process could respond effectively to a particular organisation’s distinctive requirements. The success of the collaboration between the departments depended less on reporting relationships and processes than on who was engaged in this common pursuit and their skills, experiences, how they related to each other, and how willing they were to discuss ethics issues.
Senior management could help, the report said, by establishing policies and procedures that encouraged or even required collaboration.
“The organisational value of promoting an ethical culture ultimately depends on what the company’s managers learn from it,” concluded Berenbeim. “Managers need to have an awareness of the ramifications of collective action, the discipline for continuous improvement and a sense of empathy. And a clear senior management mandate to collaboration is essential.”