The whole scandal and fines were also widely covered in mainstream media, which resulted in reputational losses that will take decades to rebuild. The new leadership started by doing an in-depth audit of the organization to understand how such a breach of ethics could occur within their organization. They found that the lack of a culture of compliance was to blame.

Volkswagen recently suffered a major compliance scandal. The organization had been misreporting emission data for years. They were fined $25 billion for the scandal which was termed ‘’Dieselgate’’ by the media. Volkswagen has announced a new project to improve compliance management which will involve every employee of the organization. The project is aimed at inculcating a culture of compliance which ensures that widespread unethical practices are discouraged and eliminated permanently.

Why Culture is so Important for Compliance Management

The Volkswagen scandal is a great lesson on why culture is so important when it comes to compliance management. The misreporting of emission data was not a practice which was being carried out by a single employee – whole departments were involved in it. Even the department that weren’t involved in it were helping the scheme by not doing due diligence which would have caught the disappearances in the data. There was a special program installed into the vehicles which lowered emissions during tests. This meant that management ordered the software to be made, which was then developed, and then implemented in the vehicles. This whole process involved many employees from across the organization.

Don’t forget to read our recent blog “Culture Remains One of the Most Important Factors in Improving Compliance and Risk Management”.

If the organization had the right culture of compliance someone would have reported the misreporting and deception, but no one did. Thus, Volkswagen will now focus on creating the right culture to protect against similar ethical breaches in the future.

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Compliance Management Systems Help Prevent Such Cultures from Forming

Compliance management systems play a major role in ensuring that such cultures are never formed in the first place. Manual reporting leaves room for error and misreporting. If the reporting workflow is automated there is no room for misreporting data. Everything is easier to verify as well – an audit can be done in just a few clicks be recalling previously recorded data inputs. Compliance cultures and compliance management systems are thus complimentary forces which help businesses improve compliance management.

Nowadays it is affirmed that the corporate culture is what people do when no one is looking, and this must be understood as what is done because it is something innate, because it is the way of being, it must be what is done when they look at you and when they do not look at you It would be a perverse culture if things were done differently than openly in privacy. Compliance reflects precisely this new spirit that must characterize the company, which must be articulated on the basis of a culture based on a system of shared assumptions, values, beliefs, which should govern the behavior of organizations.

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These shared values have a great influence on the personnel and determine all aspects of their activity, how they act, how is their business mission, and their business vision. Each organization develops and maintains a unique culture that provides guidelines and limits to the behavior of its members. And therefore, it can be said that each organization must develop and maintain a culture of “Compliance” adapted to the demands of the society where it interacts, but also according to its own corporate culture, which can no longer be different from the philosophy of culture of compliance to be adopted.

If you want to see how a compliance management system can help your business create the right culture of compliance, then you’ve come to the right place. We have a white paper focused on building a culture of compliance. Our team is also available to demonstrate how the Predict360 Compliance Management Solution can help your business and to provide you with a trial so you can test it. Get in touch with us to start your trial and demo.