Top Compliance Trends of 2024: Greenwashing & Neurodiversity on the Docket

From loose-lipped CEOs sinking reputations and sanctions on terrorist financing coming back into vogue to a proliferation of neurodiversity employment tribunals and renewed charges of greenwashing, 2024 is shaping to be an ever more complex year for compliance. 

CEOs will learn to self-moderate — or else

The trend of the outspoken CEO has come and gone. One of the biggest lessons of last year was just how dangerous a senior officer with a loose tongue can be. From Sam Bankman-Fried’s conviction to yet another Elon Musk storm as advertisers abandon the haunted halls of the platform formally known as Twitter, loose lips can sink reputations. 

Nor is the contagion linked to tech bros. Dame Alison Rose, the former CEO of British mega-bank NatWest and parent company of the royal family’s chequebook, Coutts, lost her job and precipitated a political crisis over a poor choice of words. Rose let it be known that Coutts had closed the bank account of political malcontent and Brexit architect Nigel Farage because he didn’t have enough money. This erupted into a political storm, with British cabinet ministers questioning well-established AML procedures for politically exposed persons. Rose lost the prime minister’s confidence, resigned without her £7.6m golden goodbye and precipitated a GDPR investigation into NatWest.

The lesson for compliance teams in 2024 is to get your CEOs and senior managers signed up to a stringent communications policy and make sure they stick to it. Because if those conversations don’t happen in the boardroom, they could be hashed out in public. 

Sanctions, AML and counter-terror financing will come ever closer together

The Russian invasion of Ukraine shot sanctions compliance to the top of many agendas in 2022, and the trend continued in 2023 as the war dragged on and more oligarchs came under international sanction. As war continues in Ukraine and countries begin to sanction Iran-backed Hamas terrorists responsible for the Oct. 7 attack on Israel, the nexus of sanctions, money laundering and counter-terror financing will come ever closer together in 2024.

Sanctioned individuals and entities use various methods to move their funds worldwide, shifting between regulated and non-regulated entities but potentially putting all companies at risk.

As the world sanctions more terrorists, including those backed by nation-states like Russia and Iran, the dividing lines between terrorist financing, money laundering and sanctions become ever blurrier. Whether or not a firm is regulated, undertaking sanctions and money laundering-focused risk assessment is the least a business can do to understand if it is a risk to be targeted by terrorists or oligarchs looking to hide their assets.

Neurodiversity discrimination will rise to the fore

Workplace diversity initiatives have taken a strong turn toward neurodiversity inclusion, with employers and employees benefiting greatly from increased awareness of different ways of thinking. 

Neurodiversity training is increasingly standard in many forward-thinking inclusion programs, alongside new ways of considering reasonable accommodations and tailored adjustments.

However, 2024 is likely to see a much greater emphasis on what happens when not enough is done on neurodiversity. In the past year, in the UK alone, over 100 cases of neurodiversity discrimination were taken to employment tribunals, a staggering increase from next to none in years past.

One common thread among these cases is the perception that neurodivergent employees’ performance or behavior in the workplace is unfairly assessed due to how their minds work. This has raised concerns about whether employers are adequately equipped to accommodate and support neurodiverse individuals or if they are inadvertently contributing to an environment where discrimination claims thrive.

Forward-thinking organizations will remember menopause exists 

If your organisation doesn’t yet have a menopause plan, it should be high on the DEI agenda for 2024. The facts alone make it perhaps the most significant undiagnosed barrier to inclusion in the workplace. 

Menopausal women are the fastest-growing demographic in today’s workplace. In the UK, 60% of women have taken time off work due to menopause symptoms, 900,000 women have left their jobs due to menopause and 67% of women with experience of menopausal symptoms say they have had a mostly negative effect on them at work, according to data from CIPD. 

Menopause leave isn’t a complicated change to introduce. It can be as simple as allowing home or hybrid work on-demand or dropping the bureaucratic and outdated need for employees to bring medical certificates every time they have an appointment or are dealing with symptoms. Firms can also consider menopause a health-related issue and allow employees experiencing symptoms to go through the reasonable-adjustments route. It’s really not that hard to become menopause friendly. And it starts by talking about it.

Cryptocurrency will not come back from the dead

Every conviction of a crypto-bro is yet another nail in the coffin of the concept of digital currency. Binance CEO Changpeng Zhao’s guilty plea on money-laundering charges proves that cryptocurrency, as it was first conceived, cannot survive AML regulations. From Coinbase to FTX and now Binance, the financial services industry must seriously ask if there are any legitimate reasons for using cryptocurrency. 

Whatever its initial designs and supposed benefits, the reality is that crypto is a volatile financial product almost exclusively relied upon by criminals to facilitate money laundering, terrorist financing and proliferation financing. 

As more operators like Binance face fines and lawsuits, the crypto market will continue to experience greater volatility. Any legitimate investors left will become increasingly desperate to offload their failing assets, and the entire industry will become a greater target for nefarious actors. Like a fire sale at a burned-out factory, criminals, human traffickers and even terrorists are seeking to buy up crypto assets from sellers desperate for hard cash and then launder these assets around the world.

Companies will be pressed to tell the truth on ESG

It might seem odd to remind businesses to tell the truth, but when it comes to ESG, that message is vital going into 2024. A Deutsche Bank subsidiary was recently fined $25m by the SEC for not following through with press-released promises. 

The SEC uncovered that while the company had nice things to say about ESG, there wasn’t a single policy or formal procedure to ensure those promises were kept. There were no standards to ensure compliance, nor any way to assess if managers used their ESG tools to make decisions.

Policies must be worth the paper they’re written on, and so should news releases. ESG is being treated just like any other material disclosure. It has to be true, it has to be evidenced and what’s published has to remain policy and practice. As ESG continues to mature in 2024, more is and will be expected from companies. But the ESG story should be the truth.