Reflections on leadership, Compliance culture and its relevance in regulatory interpretation

Reflections on leadership, Compliance culture and its relevance in regulatory interpretation

In today’s dynamic corporate landscape, Compliance management is not only about legal obligations, but is a strategic tool to support the integrity and sustainable success of organizations. In the context of this complexity, two fundamental elements stand out: committed leadership in the Compliance function and the construction of an ethical corporate culture. Next, we will analyze the interrelation of these elements, as well as their relevance in the interpretation of Compliance regulations.

The effectiveness of Compliance programs does not lie simply in the implementation of written policies, but in their daily roots in the organization. This firm commitment is achieved through internal leadership, genuinely attending to the good practices of those who direct and manage corporations at all levels.

Leadership and corporate culture: two indivisible pillars. Leadership and corporate culture are interdependent concepts that subsist in the Compliance ecosystem. Composed of values ​​and actions, culture represents the organization’s ethical system. Leaders, for their part, instill these values ​​in employees, thus guiding the purpose for which daily tasks are carried out.

Ethical and cultural leadership. Effective leadership in Compliance not only focuses on the regulatory system applicable – both internally and externally – to organizations, but especially has a positive influence on the overall operation of the company. Indeed, the leader in the field of Compliance must promote ethical values, communicate the importance of Compliance and establish accessible and effective policies in accordance with the corporate culture of the organization. Therefore, corporate culture, as an informal system in the organization, becomes essential to interpret Compliance regulations.

Normative interpretation and the influence of culture. Culture forms the approach through which Compliance regulations are understood and applied. An ethical culture facilitates a deep understanding and ultimate purpose of the standards, ensuring that the mere compliance with formal requirements is not sought, but rather the following of principles rooted at all levels of the organization. That is to say, it is no longer just the actions that matter, but rather that they are carried out in accordance with the organizational culture and pre-established ethical values.

Leadership and culture: key elements to achieve a comprehensive interpretation of Compliance. Ultimately, an effective Compliance program depends on leaders who consider it vital to organizational success. The link between ethical leadership and a solid corporate culture not only drives the design and effective implementation of regulations, but also guarantees a thorough interpretation of the regulatory framework, contextualizing it according to the organization’s design of ethical values. On this path towards excellence, training and professionalization of the Compliance discipline, leadership and culture become lighthouses that guide sustainable organizations appropriate to current corporate evolution.

By Lucía Rodríguez Wikman, Lawyer | CIEMSA | Compliance Latam Collaborator