Compliance and integrity culture in internal audit: synergy of management standards and sustainable development

Abstract

Abstract: It is argued that the relevance of the study is due to the growing demands for transparency, accountability, and effective risk management in the context of globalization and digitalization of business. Compliance is becoming strategically important, integrating into internal audit as a key function that promotes compliance with international standards, the formation of a culture of integrity, and the sustainable development of enterprises. The purpose of the article is to study the role of compliance and a culture of integrity in internal audit, taking into account ESG management standards and principles. Methods. The methodological basis of the study is a systematic and comparative approach to the analysis of modern models of compliance and internal audit. The following were used: analysis and synthesis to generalize trends in the development of compliance systems; SWOT analysis to identify the advantages and threats of their implementation; a structural-functional approach to assess the role of internal audit in strengthening a corporate culture of integrity; and case studies to demonstrate practical ESG compliance tools. Results. Key areas for the formation of a compliance system in Ukraine have been identified: legislative regulation, the development of compliance at the enterprise level, and the influence of European integration processes. It has been shown that the integration of compliance into internal audit ensures control over compliance with legislative and corporate standards, reduces financial and reputational risks, and fosters a culture of integrity. Practical compliance tools (policies and codes of ethics, whistleblowing systems, digital monitoring tools, anti-corruption programs) are highlighted and their role in increasing business transparency and sustainability is revealed. The importance of integrating ESG principles into internal audit as a factor in increasing investment attractiveness is substantiated. Conclusions. It is concluded that the combination of compliance and internal audit is a strategic tool for ensuring the sustainable development of enterprises. This contributes to the harmonization of management standards with international practices, increasing the confidence of investors and partners, forming a positive business reputation, and strengthening economic security. Prospects for further research lie in studying the impact of digital technologies and artificial intelligence on the effectiveness of compliance procedures and improving the model of their integration into internal audit. Keywords: compliance, internal audit, strategic function, management standards, ESG, sustainable development, corporate responsibility, risk management, digital tools, academic integrity.