Conduct and culture: A growing focus for U.S. regulators?

Why are conduct and culture becoming more important compliance considerations?

Conduct and culture can influence how employees make decisions, communicate with colleagues and clients, escalate concerns, and respond to risk. For regulated firms, that makes culture relevant to more than internal values or employee engagement: it can affect whether policies, supervisory controls, and compliance expectations work in practice.

The report examines the growing attention being paid to conduct and culture in the U.S. and what that may mean for compliance teams assessing employee behavior, communications risk, and the effectiveness of their existing controls.

If you’re looking for strategies to mitigate the risk of non-financial misconduct and meet increasing regulatory expectation, watch our latest webinar on demand to hear expert insight on cultivating a “culture of compliance” within your firm.

What does conduct and culture risk look like in practice?

Culture risk does not always appear as a single obvious breach. It can emerge through patterns of behavior, recurring communications, poor escalation, normalization of inappropriate conduct, or a gap between formal policy and how teams actually operate.

For compliance teams, this means looking beyond isolated incidents and considering whether employee behavior may indicate wider weaknesses in supervision, accountability, or the organization’s control environment.

Why do employee communications matter?

Employee communications can provide important context around how decisions are made and how workplace behavior develops over time. Email, messaging platforms, collaboration tools, mobile communications, and voice can contain signals that are difficult to identify through policies or periodic reviews alone.

When communications are captured and available for appropriate review, firms can look for recurring patterns, understand the context around specific events, and investigate whether an individual issue may form part of a broader conduct or culture concern.

How can communications surveillance support conduct and culture oversight?

Communications surveillance can help compliance teams identify potentially relevant language, patterns, and behaviors across large volumes of employee communications. Used alongside other supervisory and investigative controls, it can help surface issues that may otherwise remain fragmented across channels or teams.

The objective is not to treat every unusual communication as misconduct. Effective oversight requires context, proportionate review, and human judgment so that potentially meaningful behavior can be distinguished from normal business activity.

What should compliance teams consider?

Organizations reviewing their approach to conduct and culture can consider a number of practical questions:

• Are conduct and culture risks clearly reflected in the firm’s risk assessment and supervisory approach?
• Can compliance teams access the business communications needed to investigate potential concerns?
• Are relevant communications captured consistently across email, messaging, collaboration, mobile, and voice channels?
• Can surveillance and investigation teams identify patterns across channels rather than reviewing communications in isolation?
• Are escalation processes clear when potential conduct or culture issues are identified?
• Do policies and training reflect the behavior and communications risks the organization is seeing in practice?

From individual incidents to wider cultural signals

A conduct issue may begin with a single communication or event, but its significance can depend on the wider context. Repeated behavior, similar incidents across a team, or communications that suggest a problem has become normalized may indicate a broader cultural concern.

This is why conduct and culture oversight benefits from complete communications records, consistent supervision, and the ability to investigate patterns over time rather than relying only on individual alerts or complaints.

Explore the full report

Read the full report to explore the developing U.S. regulatory focus on conduct and culture, the implications for compliance teams, and how communications oversight can support a more complete understanding of employee behavior and organizational risk.