General Motors Co. has a storied history in the auto industry. For more than 100 years, the global carmaker has built a loyal following of customers for vehicles ranging from the unbelievably fast new C7 Corvette Stingray to the environmentally friendly electric Chevrolet Volt. Customers buy GM cars because they believe in the brand. They trust that GM will build safe cars—cars that are innovative and exciting, but also dependable. Reports of GM’s failure over 10 years to recall faulty ignition switches that could potentially shut off the engine and disable the vehicle’s airbags have tarnished the company’s reputation and raised questions about how much GM values the safety of its customers.

At compliance conferences, we hear speakers talk about the penalties for noncompliance through the lens of government enforcement and significant fines. But what’s worse for a company over the long term is a loss of customer trust. Fines can be draconian and harsh, hurting the bottom line. After the company pays the fine, however, it’s business as usual. How many customers did Panalpina lose over its $71 million Foreign Corrupt Practices Act fine? It remains one of the five largest freight forwarders in the world despite the high risk that freight forwarding poses to many of its customers, and the fact that a number of the company’s customers were also convicted of FCPA violations, resulting in a total of $236.5 million in settlements paid to authorities.

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