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The Importance of Employee Empowerment

By Sam Flores

What do you do when you observe, or are put into a situation that you believe is illegal or, at the very least, unethical?  What if the person responsible for the situation is a superior?

A clearly defined employee handbook outlining expectations and well documented policies helps minimize ambiguity that may result in “personal interpretations” of the company’s rules and regulations.  But who is ultimately responsible for ensuring that rules are followed? Most Controllers I speak to face this same dilemma.  Many times, I’ve heard, “We get blamed for everything.” Although this may be a bit unfair, and at times not totally true, the accounting department is typically held to a higher standard.  Controllers are, in many ways, expected to be the stop gap to rule breaking.  They typically ensure the rules are followed.  We have all experienced at one time or another, the penalties that can come from non-compliance.  But no number of rules are effective without support from upper management.  We have all dealt with the constant struggle between what is “theoretically” correct and what happens in the “real world”.

Although you cannot completely predict every ethical/legal dilemma that may arise, you can take steps to mitigate certain employee actions from bringing great consequences.   Transparency goes a long way to ensuring that these dilemmas are spotted and dealt with timely.  Strong communication with and among upper management is key.  Sometimes, issues arise and are allowed to continue because employees’ fear of retaliation.  To open the lines of communication, some dealer groups have established compliance committees to address potential issues.  If you do not have such resources, you can designate a compliance officer.  Further, some dealers have established a confidential hotline where employees can anonymously report unusual activities. Do your employees know who to contact without fear of repercussions?

There is no single remedy to prevent an illegal /unethical incident at your dealership, but you can reduce your exposure by being proactive and communicating with front-line employees, ensuring they have both a responsibility to protect the company and the means to have a voice that will always be heard.

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