Practical insights for compliance and ethics professionals and commentary on the intersection of compliance and culture.

Insights from management for compliance officers

This is the fourth and final in a series of four posts on insights for compliance officers from different fields of study.  The first post in this series covered lessons from psychology regarding, for example, self-interest and decision-making, from prominent figures such as Sheena Iyengar and Malcolm Gladwell.  The second post was about insights for compliance officers from self-development and coaching, including from people such as Wayne Dyer and Eckhart Tolle.  Last week’s post discussed behavioral economics, focusing on the work of people such as Dan Ariely and Richard Thaler.  Today’s post will suggest ways in which management theory can be applied to corporate compliance programs.

As a practice, compliance is greatly concerned with topics such as governance, controls, leadership, sustainability, business values, organizational integrity, risk controls, institutional decision-making, tone and conduct at the top, and corporate culture.  It shares these general disciplinary themes with management theory, which takes on the broad task of determining and guiding the strategic direction of an organization and steering its employees and resources in furtherance of these goals.  Given that the contributions of a robust compliance program to the regulatory, practical, and cultural aspects of this task are great, compliance officers stand to gain great insight from studying commentary from the field of management theory.

Simon Sinek – Simon Sinek is an British-American management expert, motivational speaker, and writer.  His specialty is focusing on the role of effective, strong leadership in business success.  By definition, a sustainable leadership style must also be an ethical one, so all great leaders should place an emphasis on guiding their actions within their organizations from a basis of integrity and values.  Sinek’s most famous work, Start with Why, relies upon this principle to develop the position that inspirational leaders are more powerful and effective than manipulative ones.  Also important in Sinek’s work is an emphasis on purpose-driven life and work.  For more on the importance of a purpose- or values-driven perspective, check out this post.  Check out Sinek’s popular TED talk, “How great leaders inspire action,” for more on these themes:

  • Daniel Pink – With a background in law, politics, and social science, Daniel Pink brings a diverse perspective to management theory.  His very influential business writing often focuses on motivation, interest, and choice, topics which are all highly relevant for corporate compliance.  Pink’s book Drive: The Surprising Truth About What Motivates Us, seeks to express a fully modern perspective on the true sources of motivation in both work and life.  From this perspective, Pink posits that people are no longer motivated by old measures of success such as rewards or money, or former deterrents, such as fear of being punished.  Instead, people seek their main motivation from, as Sinek describes as well, and Viktor Frankl’s writing in psychology also suggested, embracing purpose and meaning in all areas of life.  For more from Pink on motivation, check out his TED talk “The puzzle of motivation,” which discusses lessons managers can learn from social sciences (perhaps, including, the related discipline of, and “soft” controls from within, compliance):

  • Carol Dweck – Carol Dweck makes use of a traditional background and education in psychology to inform management theory based on the psychological trait of mindset.  Like Pink, Dweck has contributed significant views about the power of motivation.  According to Dweck in her book Mindset: The New Psychology of Success, individuals can all be located on points on a mindset spectrum from “fixed,” people who believe their abilities are innate, to “growth,” those who connect their expectations of success to how hard they work for it.  Considering these individual attributes and the way they are encouraged within or incorporated into corporate cultures to encourage organizational integrity and ethical decision-making is an important task in compliance risk management.  For more from Carol Dweck on her growth mindset concept, check out her TED talk “The power of believing you can improve,” which covers problem-solving and therefore can easily be applied to decision-making as well:

  • Adam Grant – Similar to Dweck, Adam Grant has a background as a psychologist.  Grant applies his expertise to organizational psychology, formulating management theories based upon dynamics present within the workplace, for better or for worse.  Grant’s first book, Give and Take: A Revolutionary Approach to Success, defines a perspective on achievement that promotes inner success and suggests that a collaborative and cooperative culture at work is the most productive one.  The benefits of working together are obvious for encouraging ethical decision-making and integrity, if leadership nudges sufficiently toward optimal choices and sets clear, compelling expectations for which the group can strive and in which they can supportively challenge each other.  Check out this TED talk from Grant, “Are you a giver or a taker,” for a more in-depth explanation on the various workplace dynamics, which coincide well with Dweck’s mindset traits:

  • Ben Horowitz – As has been written about on this blog before, effective fundamental compliance controls are especially important and impactful in small businesses, including start-ups and founder-led organizations.  Horowitz’s book The Hard Thing About Hard Things, delves into the challenges of ethical and sustainable decision-making in the start-up world.  Horowitz dispenses with the romanticism and idealism that can dominate entrepreneurial, innovative working environments, instead opting to underscore how important effective management and skills targeted toward sustainable and professionalized business operations are the most important ones.  For more on compliance basics for small businesses and for start-ups in particular, check out this post and this post or this post.  For a discussion of ethical decision-making that focuses on hard choices, check out this post.  For an interesting talk from Ben Horowitz, check out “Nailing the Hard Things,” in which he identifies the most important skills entrepreneurs should have, according to his management vision:

Hopefully this series on interdisciplinary insights for compliance officers – covering a wide array of theories from psychology, behavioral economics, self-development and coaching, and finally management – has been entertaining and thought-provoking.  Check back in the future for subsequent posts on these themes including closer looks at the theories and works of some of the previously-discussed individuals.

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