What action should organizations take if they discover a compliance violation?

Self-disclosure to authorities is the most appropriate action for organizations to take upon discovering a compliance violation. Engaging in self-disclosure demonstrates a commitment to transparency and accountability, which are essential principles in compliance and ethics. By proactively informing regulatory bodies, organizations not only fulfill their legal and ethical obligations, but they also may benefit from reduced penalties or leniency that can result from their cooperative stance.

Self-disclosure can serve as a mitigating factor in enforcement actions, often leading to a more favorable outcome for the organization. Authorities typically appreciate when organizations take responsibility and show a willingness to rectify issues, which can positively influence the relationship between the organization and regulatory entities. This proactive approach also helps organizations to strengthen their compliance programs and prevent future violations, thus fostering a culture of compliance within the organization.

The other options lack the same level of integrity and adherence to compliance principles. Hiding violations can lead to more significant problems if discovered later, including exacerbated penalties. Seeking to avoid penalties without taking responsibility may also reflect poorly on the organization, as it may not adequately address the underlying issues. Informing only the regulatory body while neglecting internal stakeholders can lead to increased risks and a lack of accountability within the organization.