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In many regulated firms, Compliance and HR operate in parallel but disconnected streams. Compliance focuses on controls, clear policies, rules, and audit trails. HR is seen to handle engagement, retaining talent, and development. But in truth, these two worlds overlap when it comes to compliance efforts and they should both be fully aligned as a compliance team when it comes to achieving business outcomes.
Harmonising this relationship is key to either side being truly effective and can be key to operational efficiency. We cannot deliver meaningful compliance without considering leadership’s role in creating compliance culture . This where employees are fully bought into the importance of meeting regulatory requirements or risk management, even in routine tasks and see this as a fundamental part of a company’s operations . Equally, we cannot drive cultural compliance through HR processes without embedding accountability, regular training and performance management into the rhythm of everyday operations.
This blog explores the importance of integrating compliance into everyday people practices to identify areas of risk and non compliance promptly and address them. By increasing the visibility and ownership throughout the organisation we go beyond meeting basic regulatory or legal standards and start to align the organisation’s values with the requirements of legislation. It’s about creating a compliance culture that fosters ethical decision making and employees feel part of.
The FCA and other regulators have long urged firms to move away from paying lip service to compliance standards or treating risk mitigation as a one-off exercise. A true culture of compliance goes beyond rules on paper — it’s about how values and behaviours are lived across the organisation every day.
The CIPD, as the UK’s professional body for Human Resources, reminds us that HR professionals may not be compliance officers, but they are key custodians of people-related compliance policies and employment law requirements. These legal obligations form the foundation of compliance, yet focusing only on HR regulations and basic adherence is too narrow a view. HR teams also play a vital role in shaping organisational culture, influencing ethical decision-making, and supporting continuous improvement throughout business operations.
A robust compliance culture sits at the heart of sustainable compliance. It affects everything from customer care and employee wellbeing to psychological safety and ethical behaviour. While regulatory compliance initiatives or legal requirements often provide the initial motivation to comply, many businesses still operate from a place of fear — fear of penalties, reputation damage, or enforcement action.
However, fear-based compliance does not lead to long-term change. When employees understand or see compliance as something imposed or just lip service rather than part of the core values of the organisation, they disengage. If the external pressure disappears, so does the behaviour. By contrast, a culture of ownership and integrity ensures compliance continues even without oversight.
A positive, values-driven culture means that meeting compliance standards is part of daily business operations — not a separate activity or annual audit. Compliance becomes “what we do around here.”
Just as performance reviews should be ongoing and authentic rather than a yearly formality, compliance management systems must include regular reviews and conversations. These ensure employees at every level understand not only what the rules are but also why they exist — reinforcing good judgement and accountability.
Business leaders play a vital part in this process. They set the tone by embedding compliance objectives into strategy, modelling ethical behaviour, and ensuring that continuous education is part of organisational life. Ongoing learning, discussion, and reinforcement help maintain high compliance standards and prevent complacency.
The way people are recruited, developed, and managed has as much influence on compliance as any formal policy or audit trail. That’s why HR processes are not simply administrative — they are one of the most powerful levers for embedding compliance standards across an organisation.
While the Compliance function focuses on monitoring risk and maintaining regulatory frameworks, HR shapes the environment in which those frameworks succeed. Processes such as onboarding, appraisals, one-to-ones, and performance reviews are key opportunities to reinforce behavioural expectations and accountability.
When HR and Compliance work hand in hand, compliance policies become part of the employee experience rather than an external obligation. This partnership ensures that rules are understood, applied consistently, and supported by the right development tools. It also ensures that compliance culture doesn’t depend on enforcement — it grows naturally from leadership, dialogue, and shared responsibility.
HR touchpoints such as Fit and Proper reviews, annual training, or certification programmes provide natural opportunities to assess competence, values, and conduct. These processes highlight early warning signs — for example, inconsistent feedback, poor behavioural trends, or gaps in development — allowing issues to be addressed before they become risks.
By incorporating compliance standards into these moments, organisations can create a feedback loop between culture, conduct, and performance. Managers can use appraisal discussions to reinforce ethical decision-making, while learning and development teams can use data from reviews to shape targeted compliance education.
To support this alignment, HR and Compliance must have the right systems and data visibility. When processes are supported by integrated digital platforms like Actus Oversight, information flows seamlessly across departments. Compliance training records, performance data, and behavioural feedback can all be viewed in context — providing an accurate, real-time picture of organisational health.
This level of transparency enables senior managers to make informed decisions about where support, training, or intervention is needed. It also helps to ensure fairness and consistency, reducing bias and protecting both employees and the business.
Leadership accountability is central to maintaining a healthy compliance culture. Leaders must set expectations through their actions, not just their words. They should model the desired behaviours, follow through on commitments, and take time to explain the reasoning behind specific policies.
Continuous education plays a crucial role here. Regulations evolve, and so must awareness. By ensuring that ongoing learning and reflection are part of the performance management cycle, firms can keep compliance knowledge fresh, relevant, and actionable. Whether through micro-learning, workshops, or team discussions, continuous education ensures that compliance remains embedded in daily business operations.
When HR and Compliance functions collaborate effectively, they create a consistent foundation of trust and accountability. People understand what is expected of them and feel confident that policies are applied fairly. Leaders have access to meaningful data that connects culture to performance. Regulators see a coherent approach supported by evidence and behaviour.
This integration doesn’t just prevent breaches — it enhances business performance. When people understand the purpose behind compliance, they are more engaged, innovative, and aligned with the organisation’s goals. That’s what turns compliance from a constraint into a competitive advantage.
Even the most comprehensive set of values, policies or standards will fail to drive consistent behaviour if people don’t understand what those standards look like in practice. This is where HR and Compliance can collaborate to make expectations tangible — translating organisational values into the real-world behaviours that underpin trust and accountability.
Many organisations proudly display their values — integrity, fairness, transparency — on their websites or office walls. Yet, regulators such as the FCA increasingly expect firms to demonstrate how these values translate into measurable behaviour. That means being able to show how cultural principles directly influence business operations and customer outcomes.
A joint approach between HR and Compliance can help create a behavioural framework that defines what good looks like in everyday scenarios. For example, what does “acting with integrity” mean when handling a customer complaint? How should “accountability” show up in decision-making or reporting? Clear, observable standards make it easier to identify strengths, address risks, and promote consistent conduct across teams.
Behavioural expectations need to be reinforced through continuous education. Regular workshops, case studies, and discussions help employees reflect on real examples of decision-making and ethical dilemmas. This not only strengthens compliance competence but also develops the critical thinking needed to handle new or complex challenges.
Leaders should use these sessions to discuss lessons learned from near misses or incidents. When teams view these as learning opportunities rather than blame exercises, it builds psychological safety and continuous improvement — two hallmarks of a healthy compliance culture.
Digital performance management platforms like Actus Perform make it easy to embed these behavioural frameworks into everyday processes. Through integrated objectives, 360 feedback, and performance reviews, compliance-related behaviours become visible and measurable. This allows HR and business leaders to monitor progress and identify gaps before they develop into compliance risks.
By aligning Actus Perform with Actus Comply, firms gain a holistic view of performance and conduct. This joined-up approach ensures that ethical behaviour, leadership quality, and compliance standards all move in the same direction — supporting a high-performing, values-driven culture.
Without clear alignment between commercial goals and compliance standards, cultural drift can occur. Employees may focus on revenue, growth, or efficiency at the expense of customer outcomes or ethical decision-making. This disconnect often arises when managers fail to set clear expectations that link compliance to day-to-day objectives and potentially reward.
In the case of Consumer Duty regulations each role within an organisation should understand how they can potentially impact a customer. For example, a client relationship manager might be responsible for demonstrating fair treatment and transparency, while an operations manager might focus on data integrity or timely issue escalation. By aligning these objectives with defined consumer duty compliance standards, employees can see exactly why their behaviours matter and be rewarded for it.
When compliance is woven into performance management, it’s clear that doing the right thing is not an occasional expectation — it’s how business is conducted every day.
Performance conversations should consistently include compliance-related metrics, such as customer outcomes, process accuracy, and adherence to Conduct Rules. These metrics not only prevent compliance issues but also help employees see the link between their work and the firm’s broader responsibilities.
Digital tools like Actus Perform make this alignment easy by combining operational targets with compliance goals. For example, managers can track objectives such as reducing customer complaints, maintaining data accuracy, or following escalation procedures, alongside standard KPIs. This turns compliance from a regulatory necessity into a measurable driver of business performance.
Transparency is vital for maintaining accountability. When performance systems like Actus Perform integrate with compliance management tools such as Actus Comply, they create real-time visibility across teams. This allows both compliance teams and senior leaders to see how objectives, behaviours, and outcomes align with regulatory requirements.
This joined-up view also enables proactive intervention. If certain teams consistently fall behind on compliance measures or if feedback indicates repeated compliance issues, leaders and compliance officers can identify the root cause early — whether it’s unclear guidance, training needs, or resourcing pressures. Addressing these gaps before they escalate supports fairness, consistency, and regulatory confidence.
Middle managers and team leaders play a pivotal role in ensuring employees appreciate the purpose and importance of compliance. Leadership communication should reinforce that compliance is not just the job of compliance teams — it’s everyone’s responsibility. By setting clear expectations, discussing them regularly, and integrating them into team meetings and coaching sessions, leaders embed these into the rhythm of day to day business.
When leaders openly discuss compliance issues and learning moments, they normalise conversation around risk and accountability. This openness encourages employees to speak up early, fostering psychological safety and transparency.
Compliance knowledge can’t remain static; it must evolve alongside changing regulations and business priorities. That’s why continuous education is essential. Regular learning sessions, scenario-based workshops, and refresher discussions keep compliance front of mind and ensure that everyone understands both the “what” and the “why” of new regulations.
Actus supports this culture of continuous improvement by linking learning objectives to compliance outcomes within the performance management process. This creates an audit trail that tracks development and competence — essential for regulatory frameworks like SMCR and Consumer Duty.
When employees see that their learning contributes to business success and risk reduction, engagement grows and compliance becomes self-sustaining.
Ultimately, aligning individual objectives with compliance embeds accountability at every level. It connects behaviour to business outcomes and reinforces that compliance is central to high performance, not in conflict with it.
By aligning systems, leadership communication, and continuous education, compliance becomes a shared commitment that supports sustainable growth, reduces risk, and delivers confidence to customers and regulators alike.
A strong compliance culture doesn’t begin in the compliance department — it starts with people. HR plays a vital role in shaping the values, behaviours, and systems that determine whether compliance standards are truly embedded or merely documented. When HR and Compliance work together, they turn regulation into culture and policy into everyday behaviour.
Regulators increasingly ask firms how they know their culture is healthy. It’s not enough to point to the absence of breaches or fines. True cultural health is reflected in employee engagement, psychological safety, and consistent ethical behaviour. HR teams are uniquely placed to measure and influence these factors through recruitment, onboarding, appraisals, and employee engagement surveys.
Through these touchpoints, HR ensures that compliance expectations are built into every stage of the employee experience. Well-designed processes set clear expectations about conduct and accountability while providing support, development, and feedback to reinforce the right behaviours.
Compliance culture is built in everyday interactions — team meetings, coaching sessions, and performance reviews. By working alongside compliance teams, HR can use people data to identify early warning signs such as disengagement, poor feedback patterns, or inconsistent leadership. This intelligence allows firms to address potential compliance issues before they escalate.
Platforms like Actus Perform and Actus Comply give HR and the board visibility and confidence that everything is under control, with specific information at their fingertips.
When compliance sits solely with the Compliance function and culture is left to Human Resources, the result is a fragmented organisation vulnerable to blind spots. Without alignment, each department assumes someone else is handling key risks, leaving space for serious compliance issues to go unnoticed.
Siloed working also breeds complacency. Employees may go through the motions of completing mandatory training or signing off on policies, but without shared ownership or challenge, compliance becomes performative rather than cultural. This separation increases the risk of groupthink — where teams stop questioning poor decisions or behaviours because “that’s how it’s always been done.”
Consider the recent case of a Human Resources advisory business found guilty of unlawful maternity discrimination. For a company specialising in HR software and compliance services, such a breach represents not only a legal failure but a devastating cultural contradiction. It demonstrates what can happen when compliance and culture aren’t joined up — when policies exist in theory but are not lived in practice.
The reputational damage in such cases often far outweighs any financial penalty. HR operations should protect a company’s credibility, not erode it. Customers, employees, and regulators quickly lose trust when an organisation’s behaviour fails to reflect its stated values.
Many compliance failures stem not from the absence of rules, but from a lack of behavioural challenge. Poor leadership behaviours go unchecked, incentives are misaligned, and subcultures develop within high-pressure teams. Over time, employees may believe that those who deliver results are protected, even when their methods breach compliance standards.
This breakdown in accountability undermines everything from consumer trust to employee engagement. Conduct Rules and compliance policies lose their meaning when they’re not applied consistently in daily operations. Joined-up leadership — where business leaders, HR, and compliance teams share oversight — ensures that everyone is accountable for behaviour, not just outcomes.
Operating in silos carries heavy costs: regulatory fines, reputational harm, high staff turnover, and disengagement. In contrast, joined-up governance provides transparency, fairness, and balance. When performance management, training, risk, and compliance speak the same language, it reinforces shared accountability. Everyone understands their role in protecting the organisation’s reputation and delivering value for customers.
Technology plays an important part here. Integrated systems like Actus Perform and Actus Comply give HR, leadership, and compliance teams a unified view of performance and conduct data. This shared insight helps identify early signs of non-compliance, recognise good behaviour, and sustain a culture of continuous improvement.
Embedding a strong compliance culture isn’t about adding more controls — it’s about creating an environment where the right behaviours are reinforced naturally, every day.
Culture is shaped by what leaders do, not just what they say. Leaders must role-model compliance in their decisions, communication, and daily actions. When they demonstrate fairness, transparency, and respect for compliance standards, they send a clear message: compliance isn’t bureaucracy — it’s business integrity.
Leadership communication should make compliance part of every team conversation. Discussing compliance issues or near-misses openly creates psychological safety, encouraging employees to speak up before risks escalate. When people feel safe to question or admit mistakes, the organisation can learn and adapt — the foundation of continuous improvement.
Whether under the Consumer Duty, SMCR, or internal conduct frameworks, the ultimate goal is not to prove that compliance policies exist, but to show that they work in practice. A healthy culture turns compliance from a rulebook into a mindset. It connects values, behaviour, and decision-making at every level of daily operations.
Systems like Actus Oversight support this shift by giving firms the tools to evidence compliance through real-time data. Leaders can track metrics, monitor ownership, and demonstrate good outcomes to Boards, SMFs, and regulators. By automating compliance ownership and simplifying reporting, Actus Oversight frees up time for meaningful leadership and learning.
If you’re interested in exploring how compliance culture really works in practice — the people, behaviours, and leadership that bring regulations to life — tune into the Compliance Culture Podcast with Lucinda Carney, Chartered Psychologist and CEO of Actus.
Building on the success of the chart-topping, award-nominated HR Uprising Podcast, this new series bridges the gap between regulation and reality. Each episode features insights from compliance leaders, HR professionals, and industry experts, offering practical takeaways to help create a compliance culture in your business.
Listen on your favourite podcast platform and discover how aligning culture, leadership, and compliance can strengthen performance, engagement, and reputation — all while doing what’s right for customers.
Apple Podcasts: https://podcasts.apple.com/gb/podcast/compliance-culture/id1852447666
Spotify: https://open.spotify.com/show/5rwSPD896RiPsNBYCpJtT3
Amazon Music: https://music.amazon.com/podcasts/3992bc37-659d-4afe-8f33-9d07ac0ec84b/compliance-culture?ref=dm_ff…
Consumer Duty is not just another regulatory requirement — it represents a fundamental shift in how financial firms must operate. It asks businesses to go beyond compliance on paper and demonstrate how their culture, leadership, and systems deliver good outcomes in practice.
Under this framework, firms must evidence that customers are receiving fair value, that communications are clear, and that products and services truly meet their needs. To meet these expectations, compliance cannot sit in isolation. It must be embedded into the way people think, lead, and make decisions in their daily operations.
For many firms, compliance management still means juggling spreadsheets, tracking actions manually, and chasing updates across multiple systems. While this may work at a basic level, it introduces unnecessary risk. Information becomes fragmented, version control is lost, and accountability weakens.
In today’s environment of heightened scrutiny and rapid regulatory change, that approach simply isn’t sustainable. Business leaders need accurate, real-time insight to identify emerging compliance issues before they escalate — and to evidence the steps being taken to address them.
That’s where Actus Oversight comes in — a purpose-built compliance solution designed specifically for the Consumer Duty era. Unlike generic systems or HRIS bolt-ons, Actus Oversight is engineered to provide clarity, control, and confidence.
It gives firms a centralised compliance dashboard where key metrics, actions, and ownership are visible at a glance. This transparency enables compliance teams, HR, and leadership to work in sync, ensuring that responsibilities are understood, progress is tracked, and potential risks are surfaced early.
With Actus Oversight, you can:
By reducing manual admin and duplication, Actus Oversight frees up capacity for more strategic, value-adding activities such as leadership development, customer engagement, and continuous improvement.
Regulators no longer accept compliance as a static checklist — they expect evidence of cultural alignment. Actus Oversight supports this by connecting compliance data with behavioural insights, performance reviews, and leadership accountability. It allows firms to demonstrate how ethical decisions are reinforced at every level, turning compliance from an obligation into an operational advantage.
This visibility is invaluable. They can see how compliance standards are being lived day-to-day, identify trends that signal cultural health or risk, and intervene proactively. This combination of data and culture empowers firms to build stronger, fairer, and more transparent business practices — all while protecting both reputation and customer trust.
At Actus, we believe that compliance isn’t just about avoiding penalties — it’s about building better businesses. What’s good for the consumer is good for the firm. When employees understand the “why” behind compliance, they act with greater ownership, integrity, and care.
Through Actus Oversight, firms can evidence their Consumer Duty compliance with confidence, while fostering the culture, leadership, and learning that sustain it long term. And for those who want to explore these themes further, the Compliance Culture Podcast offers expert insights and practical discussions about turning compliance from process to purpose.
If you’re ready to move beyond tick-box compliance and embrace a smarter, cultural approach, we’d love to show you how Actus Oversight can help.
Book a demo today at actus.co.uk — and tune into the Compliance Culture Podcast with Lucinda Carney for real stories, practical ideas, and strategies to make compliance part of everyday business success.
Book a demo to see how Actus Oversight can help you confidently meet the FCA Consumer Duty Read our blog for more compliance resources
Actus Oversight – Consumer Duty Software
Enjoy this blog by Lucinda? See below for more compliance resources available to you.
Apple Podcasts: https://podcasts.apple.com/gb/podcast/compliance-culture/id1852447666
Spotify: https://open.spotify.com/show/5rwSPD896RiPsNBYCpJtT3
Amazon Music: https://music.amazon.com/podcasts/3992bc37-659d-4afe-8f33-9d07ac0ec84b/compliance-culture?ref=dm_ff…
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