With growing economic uncertainty and an ever-changing regulatory landscape, it’s essential to prioritize values-based behavioral and ethical practices as your company grows. The LRN Benchmark of Ethical Culture report shows that companies with the most ethical cultures outperform others by 40% across key business metrics including employee retention, customer satisfaction, adaptability, innovation and growth.

Many startups and small businesses don’t prioritize traditional ethics and compliance (E&C) training, as it’s often seen as complicated and overburdensome and something that only larger, established organizations need to deal with. But as we’ve seen with cautionary tales like Thinx and Theranos, not adopting standards and strategies for E&C training can be detrimental in the long term.

Adopting a foundational compliance training program can help your organization navigate the legal and regulatory landscape, avoid fines and financial pitfalls, and build an ethical workplace culture where the business and its people can thrive by acting upon shared values. Furthermore, as many organizations face economic headwinds, trade sanctions, supply chain disruptions, staffing shortages, and the like, E&C training is even more important.

And if an organization finds itself faced with an action, the U.S Department of Justice will take into account the effectiveness of an organization’s E&C program. The U.S Sentencing Committee clearly outlines the impact in its guidelines, so an effective E&C program is something organizations should build and measure while scaling.

Additionally, measuring how your E&C training programs can affect workplace culture is just as important as setting up the program itself. Ethical culture refers to the values, attitudes and behaviors of individuals and organizations that influence ethical decision-making. Measuring ethical culture requires taking a critical look into your organization’s more qualitative key performance indicators (KPIs), such as behavior change. This can help organizations understand its values and identify areas of improvement.

Building an effective and measurable E&C training program will vary at every stage of an organization’s growth, trajectory, industry and location. However, there are a few key concepts that organizations cannot go without.

Create a Clear Code of Conduct

A code of conduct should reflect an organization and its aspirations and should be physically written down and accessible to the organization. It’s a statement of company mission, vision and values and how people in the organization are expected to conduct themselves. It also outlines important policies related to anti-discrimination, harassment and data privacy, and provides general guidance for employees at all levels.

A code of conduct should be visually engaging, readable and serve as a useful guide for employees to help influence ethical decision-making. It should also be easily accessible for all. If organizations make its code of conduct searchable, web based and mobile enabled, employees can easily consult it on a regular basis to check the parameters of conflicts of interest or find a hotline number, for example.

Ethical culture and compliance aptness is best promoted through an organization’s leadership team and memorialized in a code of conduct. The tone of the organization starts at the top, so it’s important for leadership teams to demonstrate the right behaviors, treating everyone in the organization with equal respect, acting with integrity and taking a values-based approach to decision-making. And these values should be clearly outlined in the company’s code of conduct.

Identify and Avoid Culture Hinderances

The fastest growing cohort of workers, Gen Z, is making it known they won’t work for companies whose visible values don’t align with their own. It’s important to surround yourself with people of integrity and like-minded workplace values. Instead of vetting potential new hires based upon only prior work experience, choose sharp thinkers who align with your organization’s mission and those who have strong ethical compasses who can help foster a positive and inclusive work environment. You can do this by asking questions in the interview process that help reveal a person’s values and take an in-depth look at all the touchpoints in the hiring process for your organization and ask if the process and the language you’re using is truly a reflection of what your company stands for.

Build Your Reporting Mechanisms to Assess Risk and Measure Ethical Culture

Fast-growing companies have an obligation to their stakeholders including investors, employees, customers, vendors and the planet. Government regulations are increasingly focusing on evidence that organizations are both in compliance and effectively engendering a culture of compliance at all levels of an organization. Environmental, social and governance metrics are now sitting alongside financial statements as indicators of a business that is flourishing.

Organizations should aim to measure its ethical culture early on and often. But how do you measure an effective E&C training program? Sync your human resources, legal, compliance, risk and information technology teams together with team training and engaging learning initiatives. For example, gamified compliance training can enable leadership teams to tuck in pulse surveys right into course modules to track sentiment, identify problem areas, measure change over time and benchmark against competitors.

Creating and measuring comprehensive E&C training programs can be challenging, especially for startups and small businesses without the resources or expertise. However, these programs are critical in providing the tools necessary to protect what you’re building and fostering sustainable growth and resilience. By adopting a measurable E&C training program, organizations can create strong workplace cultures, avoid reputational damage and ensure they are operating in a responsible and ethical manner from the get-go.