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Evolving CFO Role Now Includes Fostering 'Culture of Compliance'

Evolving CFO Role Now Includes Fostering 'Culture of Compliance'

While the constantly evolving role of the chief financial officer in companies has been widely reported on and seen through numerous surveys, one area that should be receiving more attention is the need to create a "culture of compliance" within the company.

According to CFO Magazine, though the CEO must play an active role in this aspect of the business, the CFO is becoming much more involved, particularly given the wide range of records the financial boss is responsible for signing off on for financial statements.

One of the main effects of more CFO focus on fostering a culture of compliance is the idea that employees feel free to speak up at the sight of any type of ethical violations that could lead to bigger problems for the company down the road, the publication explained.

Patricia Harned, president of the research nonprofit Ethics Resource Center, told the magazine that CFOs need to ensure there is a trickle down effect, meaning front-line managers feel comfortable looking out for potential violations of employees.

"If supervisors aren't supportive" of compliance, "it's likely employees will keep quiet when problems come up — or leave," Harned explained.

This culture of compliance could also be fostered through the whistleblower protection offered by the Dodd-Frank Act, which provides incentives to employees coming forward with new information about violations.