Compliance, business ethics, and culture are no longer side concerns—they are now key to building resilient, successful organizations. Once seen as a check-the-box task, compliance is evolving into a leadership function that blends legal knowledge, ethical decision-making, and cultural alignment. In today’s fast-moving world, in-house lawyers play a growing role in shaping the values and strategies that define corporate integrity.
For in-house lawyers, the growing intersection of legal, compliance, and ethics presents both challenges and opportunities. Should you specialize in compliance or remain a generalist? How do you balance business priorities with ethical integrity?
In my recent conversation with Phil Strauss, Chief Compliance Officer at Rakuten Americas, we explored how compliance is shifting beyond policies and regulations to shape corporate culture and drive business success. As Phil puts it:
“Legal is like walking a tightrope, balancing risk and business goals. Compliance is juggling—business, law, and ethics—all at once.”
So, how can in-house counsel take the lead in this evolving compliance landscape?
Watch the full conversation with Phil Strauss here:
Compliance, Business Ethics, and Culture: What’s the Difference?
Many in-house lawyers are involved in compliance, business ethics, and culture, but the two functions serve distinct purposes. Legal ensures the company stays within the law, while compliance builds internal accountability and ethical culture.
Legal focuses on ensuring the company operates within the bounds of the law, asking, “Is this lawful?”
Compliance goes further, fostering internal accountability and ethical behavior by asking, “Is this the right thing to do?”
Ethics then elevates the conversation to long-term identity: “What kind of company do we want to be?”
While general counsel focus on external risk management, compliance is about ensuring employees uphold ethical standards—often exceeding legal requirements. Compliance isn’t just about protecting the company; it’s about strengthening it from within.
Culture and Business Ethics: The True Test of Compliance
A compliance program is only as strong as the company culture behind it. Policies and training mean little if employees don’t embrace ethical behavior in daily decisions.
So how do you measure culture? Phil offers a simple but powerful test:
“Culture comes down to two things: Who do you hire? Who do you promote?”
A company’s values are revealed by who gets ahead. If ethical shortcuts are rewarded, compliance becomes just words on paper.
In-house teams should take an honest look at past hiring, promotion, and disciplinary decisions. Do they align with stated company values? If not, it may be time for a recalibration. Compliance isn’t just about policies—it’s about the behaviors leadership encourages and rewards.
Building a Compliance Program: Where to Start?
For in-house lawyers moving into compliance, ethics, and culture roles, a strong framework starts with clear guidelines. A practical Code of Conduct and policies must align with business goals, ensuring employees understand expectations without ambiguity.
Training should focus on engaging, real-world scenarios—not just ticking boxes—to help teams internalize ethical decision-making. Employees also need trust in the process: a safe, anonymous reporting system ensures concerns are raised early and without fear.
When issues arise, investigations must be fair and transparent, paired with consistent enforcement to build accountability. None of this works without leadership commitment. Leaders must model ethical behavior openly, embedding integrity into everyday actions and decisions.
To stay effective, compliance frameworks need regular risk assessments. They must adapt to new regulations, emerging risks, and changing business strategies—stagnation undermines progress.
The Future of Compliance: What’s Next for In-House Lawyers?
Rising regulatory demands, ESG (Environmental, Social, and Governance) expectations, and stricter privacy laws have made compliance, ethics, and culture critical to business success. This shift is evident as General Counsel increasingly take on Chief Compliance Officer roles, highlighting the need for legal leaders skilled in both law and ethics. Boards now demand proactive systems that embed integrity into daily operations.
Legal expertise in areas like labor laws and governance remains vital. Equally important is business acumen—aligning compliance with strategic goals rather than treating it as a checkbox exercise. Finally, communication and influence are essential to foster collaboration and sustain a culture of integrity across teams.
Compliance must evolve through regular risk assessments, agility in addressing regulatory shifts, and responsiveness to ESG trends. Legal leaders must drive this adaptability to keep pace with innovation and global challenges.
Final Thought: Compliance as a Leadership Opportunity
Compliance isn’t just about following regulations—it’s about building ethical, resilient companies. The best in-house lawyers will be those who understand both legal and compliance frameworks and use them to drive business forward.
As Phil Strauss reminds us, compliance is more than policies and procedures—it’s about culture and leadership. The companies that prioritize ethics today will lead tomorrow.
So, is compliance part of your legal team’s strategic agenda? If not, now is the time to start.
Watch the full conversation here: Notes to My (Legal) Self: Season 1, Episode 14 (ft. Phil Strauss)
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