Uploaded December 2021 | Updated September 2026, 1 hour ago
Why compliance is dead as a survival strategy for corporations including banks and financial services. Part of financial services and banking keynote for Xpedition by Patrick Dixon, Futurist conference keynote speaker. xpedition.co.uk The cost of compliance, amid ever-widening regulation, is growing apace. Large corporations in America spend around $40m each on record-keeping systems to comply with more than 300,000 separate legal statutes. Smaller companies don’t have the resources to cope, so can end up the wrong side of the law straight away.
Compliance really matters. However, as many bankers discovered, compliance with every law may keep you out of prison but cannot protect your brand or reputation, or build trust. You can comply perfectly with every regulation in every country in every year, but that will not help you when public mood changes.
A scandal happens, which is followed by a public reaction, which leads to new regulations. These are interpreted by lawyers, who try to work out what it means. And then your compliance teams turn it into another box-ticking exercise, to check you really are compliant. But you are only complying with history.
For example, until recently it was perfectly legal for a European company to pay a large bribe in another nation outside the EU, list it as a business expense, get it signed off by the auditors, and claim back tax from government. The more they bribed, the more tax refunds they received. But it is no good today for the chairman of such a company to declare that he was well aware of bribes being paid back then and that ‘it was all done perfectly legally’. He will lose his job, will never work again, and the reputation of his company will be damaged.
We will see many new regulations in consuming regions like the EU to stop corporations from escaping their moral obligations in developed nations. We have seen examples of this in global action to stop children working in textile factories.
Doing well by doing good
Companies like Unilever have led the way in reducing environmental footprint, and increasing positive social impact, with aims to help a billion people improve their health and well-being, halve the environmental impact of its products and source all its agricultural materials sustainably. In three years, the amount of sustainable agricultural supplies it used increased from 14% to 48%.
Companies such as Patagonia, Interface, Marks and Spencer, Nestlé, Nike, Natura, GE, Walmart, Puma, IKEA and Coca-Cola have taken similar steps. And many others have focused on particular areas such as reducing plastic waste.
Ethics of child labour – easy to get wrong
Few global companies today would risk ‘knowingly’ employing six-year-old children for 12 hours a day to make clothes. Yet in Bangladesh alone it is estimated that 80,000 children under 14, mostly girls, work at least 60 hours a week in garment factories.
Sadly, moral outrage can easily wreck the lives of the very children we need to protect. An international campaign led to millions of children being dumped as workers. Many went straight onto the streets, where they were at far greater risk. In most nations of the world, destitute children either have to work, beg or starve. It is as simple as that.
So where did all those ‘redundant’ children go? If you clear children out of a factory, some will beg at the gates of other lower-profile factories, until eventually another manager takes pity, and gives them some scraps to eat. Before long this manager may have twenty more at his gates, sleeping in the compound. He provides bedding and food, and in return they sweep the factory floor, or help with packing. Ethical or unethical? Humanitarian or criminal? Are you really sure how you would feel yourself in such a situation?
As I have seen in my work with the ACET foundation, the average length of time from an 11-year-old runaway girl drifting into one of the railway stations in Mumbai and being picked up by a criminal gang can be less than 12 hours. Such girls are usually raped violently and repeatedly, and are caged in a filthy brothel until their spirits are completely broken. Then they are pimped for years in the Red Light District, among 200,000 other sex workers, until they die of AIDS or look too old.
And maybe all because that girl was suddenly turned out on the streets, after living and working as an orphan, since the age of 8, in a small textile factory.
The lesson is that while ethical issues like child labour are really important, and must be addressed, they will need to be tackled in the context of overall community development, with a deeper understanding of the local situation.
Why compliance is dead as a survival strategy for corporations including banks and financial services. Part of financial services and banking keynote for Xpedition by Patrick Dixon, Futurist conference keynote speaker. xpedition.co.uk The cost of compliance, amid ever-widening regulation, is growing apace. Large corporations in America spend around $40m each on record-keeping systems to comply with more than 300,000 separate legal statutes. Smaller companies don’t have the resources to cope, so can end up the wrong side of the law straight away.
Compliance really matters. However, as many bankers discovered, compliance with every law may keep you out of prison but cannot protect your brand or reputation, or build trust. You can comply perfectly with every regulation in every country in every year, but that will not help you when public mood changes.
A scandal happens, which is followed by a public reaction, which leads to new regulations. These are interpreted by lawyers, who try to work out what it means. And then your compliance teams turn it into another box-ticking exercise, to check you really are compliant. But you are only complying with history.
For example, until recently it was perfectly legal for a European company to pay a large bribe in another nation outside the EU, list it as a business expense, get it signed off by the auditors, and claim back tax from government. The more they bribed, the more tax refunds they received. But it is no good today for the chairman of such a company to declare that he was well aware of bribes being paid back then and that ‘it was all done perfectly legally’. He will lose his job, will never work again, and the reputation of his company will be damaged.
We will see many new regulations in consuming regions like the EU to stop corporations from escaping their moral obligations in developed nations. We have seen examples of this in global action to stop children working in textile factories.
Doing well by doing good
Companies like Unilever have led the way in reducing environmental footprint, and increasing positive social impact, with aims to help a billion people improve their health and well-being, halve the environmental impact of its products and source all its agricultural materials sustainably. In three years, the amount of sustainable agricultural supplies it used increased from 14% to 48%.
Companies such as Patagonia, Interface, Marks and Spencer, Nestlé, Nike, Natura, GE, Walmart, Puma, IKEA and Coca-Cola have taken similar steps. And many others have focused on particular areas such as reducing plastic waste.
Ethics of child labour – easy to get wrong
Few global companies today would risk ‘knowingly’ employing six-year-old children for 12 hours a day to make clothes. Yet in Bangladesh alone it is estimated that 80,000 children under 14, mostly girls, work at least 60 hours a week in garment factories.
Sadly, moral outrage can easily wreck the lives of the very children we need to protect. An international campaign led to millions of children being dumped as workers. Many went straight onto the streets, where they were at far greater risk. In most nations of the world, destitute children either have to work, beg or starve. It is as simple as that.
So where did all those ‘redundant’ children go? If you clear children out of a factory, some will beg at the gates of other lower-profile factories, until eventually another manager takes pity, and gives them some scraps to eat. Before long this manager may have twenty more at his gates, sleeping in the compound. He provides bedding and food, and in return they sweep the factory floor, or help with packing. Ethical or unethical? Humanitarian or criminal? Are you really sure how you would feel yourself in such a situation?
As I have seen in my work with the ACET foundation, the average length of time from an 11-year-old runaway girl drifting into one of the railway stations in Mumbai and being picked up by a criminal gang can be less than 12 hours. Such girls are usually raped violently and repeatedly, and are caged in a filthy brothel until their spirits are completely broken. Then they are pimped for years in the Red Light District, among 200,000 other sex workers, until they die of AIDS or look too old.
And maybe all because that girl was suddenly turned out on the streets, after living and working as an orphan, since the age of 8, in a small textile factory.
The lesson is that while ethical issues like child labour are really important, and must be addressed, they will need to be tackled in the context of overall community development, with a deeper understanding of the local situation.
