OMM 640 Business Ethics and Social Responsibility

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Ethics vs. compliance: Do we really need to talk about both?

The best programs will recognize the difference between ethics and compliance and drive both as integral components of company culture and successful performance

By Ashley WatsonJanuary 27, 2014

In the ethics and compliance profession, some companies use the title, “Chief Ethics and Compliance Officer,” others use “Chief Ethics Officer” while others choose “Chief Compliance Officer.” The terms “ethics” and “compliance” are often used synonymously; as a result, drawing a distinction between the two concepts may seem unimportant. In fact, the difference between the two can be very important for your training, communications and overall culture. Indeed, the conscious choices that companies make about these concepts often define their business.

Ethics and compliance are essentially different sides of the same coin. Compliance is following the law, while ethics is doing what is right regardless of what the law says. Compliance is something that the government requires you to do. Ethics, on the other hand, is something you choose to consider when taking action. As an example, various countries have environmental laws that require products to be labeled in a certain way and may include font requirements, placement rules, etc. Failing to properly label a product or follow some other technical regulation is not unethical or immoral, but it is noncompliant, meaning that the company may face fines, liability or other government action. By contrast, a government may not dictate whether a company makes its products more environmentally safe or easier to recycle, but doing so may be the ethical thing to do.

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