There is a growing trend for naming and shaming rather than criminal penalties. Is the future of compliance self-regulation, for fear of reputational damage?
The draft regulations on gender pay reporting requirements for large organisations are set to continue the trend for self-regulated compliance rather than imposition of criminal penalties.
The government has indicated that it will publicise the identity of organisations who haven't complied with the regulations. For more information about how to comply click here.
The approach continues the trend of a willingness to name and shame non-compliant organisations. For example, a large retail brand attracted press attention for not paying the minimum wage to its employees, whilst chains in the restaurant industry were criticised for failing to pass tips left by customers to employees.
The implementation of the Modern Slavery Act Transparency in Supply Chains obligation continues the trend. The government indicated that it would name and shame those who failed to comply - a theme taken up by Kevin Hyland OBE, the new Anti-Slavery Commissioner.
The consequence of a culture where businesses are named and shamed for perceived non-compliance by consumers, stakeholders and investors is a real risk to brand. There is a fine line between compliance because it is the right thing to do and compliance to gain perceived commercial advantage.
The race to the top to drive up standards should allow people to adopt a culture where compliance goes hand in hand with corporate responsibility. Ultimately, the risk to brand will be the driving force.