Global corporate integrity standards are slowly but surely on the rise. According to the EY 2024 Global Integrity Report, almost half of respondents (49%) say that their organisations’ integrity standards have improved over the past two years, up 7% from the previous report published in 2022.

The report, which canvasses the views of more than 5,000 employees and board members across 53 countries and territories, explores how the world’s companies approach integrity from the boardroom to the office floor.

It found that the key drivers improving integrity standards include increased direction from management, stricter regulation, demand from customers and shareholders, as well as internal pressure from employees.

However, internal and external challenges pose an ongoing threat to the progress that has been made. Economic and geopolitical challenges have put increased pressure on organisations, and this has led integrity standards to slip in some cases.

Four out of 10 organisations surveyed say they find it difficult to adapt to the pace and volume of regulatory change. Internally, over a quarter of respondents cite employees not understanding the rules of conduct as the biggest threat to integrity.

Leaders need to act on what they say

When you take a closer look at the numbers, it appears that those in senior positions are more inclined to behave unethically than those in more junior roles. Almost a third of respondents (31%) say that unethical behaviour is more likely to be tolerated when those involved are senior or high performers. If leaders aren’t perceived as behaving with integrity, it’s likely employees won’t either.

Fostering a speak-up culture at all levels is important if you want to stop wrongdoing in its tracks. However, the findings show that while more than half of board members say they’ve reported misconduct in the last two years, nearly two-thirds of those say they felt under pressure not to do so.

To encourage a speak-up culture, people need to know that their concerns will be listened to and acted upon. Of the board members who chose not to report, 38% felt that their concerns would not be dealt with. In order to create an effective speak-up culture, leaders must set an example, while also providing a safe environment for employees to voice their own concerns.

Compliance programmes

More than half of the survey’s respondents say that a lack of understanding of policies or requirements, combined with a lack of internal resources to manage compliance activities, creates opportunities for employees to violate integrity standards. Fortunately, 52% of respondents said that awareness, training and communications as well as governance and leadership, are top priorities for their integrity programmes over the next two years.

When developing compliance programmes, organisations should consider developing targeted education campaigns and on-demand communication channels for higher-risk employees, jurisdictions, and compliance risk areas. We have found that an always-on, targeted strategy has greater success than classroom- or web-based training.

People are both an organisation’s most valued asset and their greatest liability when it comes to integrity—and that’s why organisations must place people at the centre of their integrity strategy. Firms need to take a holistic view on integrity. But building a culture of integrity across an entire organisation is no mean feat—it requires buy-in from both leadership and employees and can only succeed with leadership from the board.

Jim McCurry is deputy leader of the Global Forensic & Integrity Services practice at EY