How should conflicts between regulation and company policy be handled?

• A. Always follow company policy
• B. Ignore conflicts and proceed with project
• C. Follow the higher standard; escalate and seek guidance to ensure compliance with the law
• D. Consult a competitor for advice

Answer: (C)

When there is a clash between regulation and what a company policy says, the action that protects you and the organization is to follow the higher standard and escalate for guidance to ensure compliance with the law. Regulations are legal requirements, so they outrank internal rules. If a policy would put you at risk of breaking the law, you should pause the uncertain action and bring it to the attention of the appropriate authority—typically a supervisor, compliance officer, or legal counsel. Provide the details of the conflict, seek an official interpretation or exception if needed, and document the decision and the rationale. This approach preserves legal compliance and helps the company align its policies with evolving laws.

Choosing to always follow company policy can lead to unlawful results because policy is subsidiary to law. Ignoring the conflict and proceeding with the project risks violating regulations and exposing you and the organization to legal penalties. Consulting a competitor isn’t appropriate or reliable for legal guidance and could breach ethics and confidentiality.