BAI, a nonprofit independent organization that delivers the financial services industry important insights, recently published some surprising findings from a survey focused on ethics.
One of the more surprising statistics from the survey states that only 47% of human resources, risk and compliance executives at regional financial institutions would rank their company as highly ethical. That is in stark contrast to large financial institutions where 79% gave the company high marks.
Large community institutions also fell short of the national financial companies, but still did well in comparison with 71% giving high marks. The survey focused exclusively on the three areas of financial executives polling 450 human resources, risk and compliance leaders.
BAI also uncovered another trend in the data that is less than flattering for those in charge of communicating ethical standards and/or a code of conduct. On the positive side, 91% of the leaders stated above indicated that their organization has an Ethics officer.
Additionally, 85% of those surveyed feel the company is doing a good job at preventing unethical behavior and 90% felt the standards are communicated well to employees. Unfortunately, less than 42% of employees are actually aware that the company had someone specifically with that position.
According to the survey, organizations that consistently review employee feedback and keep ethical standards front of mind perform better. “Financial services leaders from community to large organizations should have a clear understanding of who or what drives the organization’s ethical and cultural backbone. Our research found that having a Conduct or Ethics officer is an essential component of this process,” said Karl Dahlgren, managing director of BAI. “Even in the absence of this role, financial services leaders need to ensure guardrails and ethics policies are clearly conveyed, followed and understood amongst all employees, protecting both customers and members in addition to the organization.”
Harvard Business Review studies have consistently reported similar communication trends at organizations beyond financial institutions. Studies show that it is not enough to have a code of conduct, but consistent communication and reinforcement is necessary to assure employees stay focused on ethical standards.
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