Ethics versus Compliance
- An internal mechanism — we perceive “right and wrong” and act accordingly
- Gives us optimum standards of conduct
- Tells us what we ought to do
- Optional with the individual beyond what the law requires
- Rules promulgated by others — we choose to comply or not
- Gives us minimum requirements of conduct
- Dictates what we must do
- A legal requirement
The rules of compliance may or may not reflect our personal perception of right and wrong — but they represent a consensus of what society feels is “right” or “wrong.” There is a major distinction between ethics and compliance: simply following the rules does not make an action ethical — at least that’s the lesson of the Nuremberg war trials. Nor is violation of an unjust law or rule necessarily unethical — for example, Gandhi’s march to the sea to evade the British salt tax, or Rosa Parks taking a seat at the front of the bus may have been illegal, but not necessarily unethical.
Although compliance certainly has its basis in ethics, it is not the same thing. When we talk about compliance, we are ideally talking about particular rules of conduct that are designed to promote the interests of all of the parties to a transaction. Although it is certainly possible to act in a compliant way without being ethical, there is a direct connection between the two concepts.
Ethics in the Agent’s Practice
Agents make ethical decisions every day when they choose what sales tools and practices to employ, the disclosures they choose to make or omit, and how they interact with prospects, clients, insurers, and fellow agents. Although avoiding unethical sales practices is certainly important, ethics includes far more than just sales practices — it extends to the agent’s entire practice.