What’s the difference between compliance and corporate culture? Is there a difference? How do they work together? In this episode, Eric looks at how two airlines, United and Delta, responded recently to challenges they faced and how their responses speak to their corporate cultures. Both airlines faced operational failures. The juxtaposition of their responses are excellent teaching moments and examples that compliance professionals can give to demonstrate the relationship between compliance and corporate culture.
United has a bad week. Much attention has been focused on the gentleman who was recently physically and forcefully removed from a plane. But there is a much bigger issue of corporate culture that ought to be the focus here. It is clear that several United employees who witnessed this incident abdicated authority or failed to question actions of other employees. This inaction speaks to United’s culture in way that ought to be of more concern more than the incident.
When considering what happened when United employees, we must look at how many individual failures had to happened for this to occur and what this tells us about United’s culture.
Compliance and corporate culture aren’t in a box that you take off a shelf. Growing an ethical culture is hard work. Corporate culture and compliance are integral to everyday operation. United’s challenge show us that corporate culture greatly affect what happens when frontline employees witness misconduct and fail to report it. These failures affect how an organization conducts its business.
Delta had to cancel 3,000 flights when extreme weather shut down Atlanta’s airport. It was a difficult situation and a much bigger disruption to operations than the incident United faced. But there was a night and day between how the airlines addressed the problem as Eric witnessed firsthand when he was stuck at Atlanta’s airport because his Delta flight was cancelled. Each Delta employee he encountered had an attitude that recognized the extent of passengers’ inconvenience and also tried to make their experience better.
When looking at two operational failures and the airlines’ reactions, you can the impact of a strong ethical culture and the apparent lack of one. Delta’s culture was flexible to take on operational failure. How would United employees handle the cancellation of 3,000 flight?
How do you approach a culture like Delta’s? There’s no easy answer when you are considering how to fix an unhealthy corporate culture. Clearly, one part of fixing corporate culture is the message from the top of the organization. The tone from the top must be strong about values and the fact that you can come forward and speak up when others act unethically or illegally. These two examples are important examples for your business units because they show the real consequences of corporate culture on organizations’ bottom lines.
Before joining Crowell & Moring, Laura prosecuted healthcare fraud in the Fraud Section of the Department of Justice. In this interview, Eric and Laura discuss what the Department of Justice looks for in an effective corporate compliance program and how the government makes charging decisions. Eric and Laura talk about the impact of the Department of Justice’s new guidance, the Evaluation of Corporate Compliance Programs, the Department of Justice’s position on remediation, and how the Yates Memorandum has affected prosecutors’ decisions to charge individuals involved in corporate misconduct.