Why 68% of Organisations Are Underfunding Misconduct Prevention

Ask most HR leaders whether preventing workplace misconduct matters to their organisation, and the answer will be an immediate yes. Ask them whether that priority has a line in the budget, and the conversation changes. Data from the Culture Shifters Annual Report 26-27 reveals only 32% of organisations have a dedicated budget for misconduct reporting and prevention.

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That gap between what organisations say matters and what they actually resource is the crux of this article. It is also one of the more uncomfortable findings to come out of a report that surveyed UK HR professionals and employees this year, because it suggests that most organisations are exposed in a way that has nothing to do with intent and everything to do with investment.

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What does underfunding misconduct prevention mean in practice?

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Underfunding does not usually look like an organisation deciding misconduct doesn't matter. It looks like a policy that exists on paper, a reporting channel that technically works, and a prevention strategy that has never had its own budget line. Spend on misconduct prevention gets absorbed into general HR overhead, training gets scheduled when time allows rather than on a defined cycle, and case management runs on whatever (usually free) tools happen to be available rather than tools chosen for the job.

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The Culture Shifters Annual Report found exactly this pattern. Organisations describe prevention as a priority in survey responses, and then, when asked about the practical mechanics behind that priority, the picture gets blurry.

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The intent-investment gap

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The 32% figure sits at the centre of the report, which examines the move from reactive reporting to proactive prevention. It is a stark number on its own, but it becomes more revealing next to the report's other findings. Only 39% of organisations share speak-up data with their board regularly, and just 41% consistently aggregate and analyse that data to identify patterns. Each of these figures describes a different symptom of the same underlying condition: prevention has intent behind it, but not investment.

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This is important because prevention work is not free. Investigating a report properly takes trained time. Running training that actually changes behaviour requires more than a single annual module. Monitoring patterns across a workforce needs a system built for it, not a shared spreadsheet maintained between other tasks, a problem we examined in detail in The Spreadsheet Problem, where 22% of organisations told us they manage misconduct data entirely through manual methods. Without a defined budget, all of this work competes for attention against everything else on an HR team's plate, and it tends to lose.

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What proper prevention funding actually covers

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Funded prevention looks different in three specific areas: training, compliance infrastructure and case management.

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Sexual harassment training is the clearest example, and one of the areas where UK organisations are furthest behind where the law now expects them to be. The Worker Protection Act 2023, which came into force in October 2024, introduced a new preventative duty requiring employers to take reasonable steps to prevent sexual harassment of their employees. This is not a duty that can be satisfied by having a policy document sitting in a handbook. Regulatory guidance and tribunal practice both point towards active measures, including regular, role-appropriate training, as part of demonstrating that the duty has been met. Training that happens once, years ago, and is never repeated or refreshed is unlikely to carry much weight if an organisation is later asked to show what it actually did to prevent harassment before an incident occurred.

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This is an area we've built dedicated resources around, including our sexual harassment training for managers and leaders through the Culture Shift Training Academy, precisely because the gap between having a policy and having trained people is where a lot of organisational risk sits.

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Legal compliance infrastructure is the second area, and it has become more urgent with the Employment Rights Act's extension of employer duties around sexual harassment prevention from October 2026. Meeting a duty to take all reasonable steps, whatever that means for a given organisation's size and risk profile, generally requires the kind of documented process that is difficult to produce without dedicated resourcing behind it. Organisations should take their own legal advice on what the duty requires in their specific circumstances, since this is fact-specific and depends on the nature and scale of the organisation involved.

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The third area is case management. A properly funded prevention function does not just receive reports, it tracks them, analyses them for patterns, and reports on them to leadership. That requires a system built for the purpose, not an ad hoc collection of documents. Report + Support™ was built around exactly this need, giving organisations one place to manage cases, spot recurring issues across teams or locations, and produce a clear audit trail when one is needed.

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What happens when prevention isn't funded

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The consequences of underfunding rarely show up immediately. An organisation without a dedicated prevention budget tends to drift towards manual case tracking, simply because nobody has approved spend on anything better. Once that happens, the pattern-recognition capability that catches repeat offenders or systemic issues early becomes much harder to build. Only 41% of organisations in our Annual Report said they consistently aggregate and analyse this kind of data, and it is difficult to separate that figure from the 68% operating without a dedicated budget in the first place.

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Board visibility suffers in the same way. When speak-up data isn't reported to the board regularly, which the report found true of 61% of organisations, leadership loses the ability to ask informed questions about culture risk, let alone approve the funding needed to close the gap. It becomes a cycle that reinforces itself: without a budget, there's no clear reporting; without clear reporting, there's no case for a budget.

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Why this is harder to justify from October 2026

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The regulatory backdrop makes underfunding a harder position to hold than it once was. From October 2026, the Employment Rights Act's expanded duty around sexual harassment prevention comes into force. Resourcing is one of several factors that could plausibly be weighed if an organisation is later asked to demonstrate what reasonable steps it took, alongside things like risk assessments, reporting processes and training records. It is not, on its own, a legal test, and organisations should take independent legal advice on their own position rather than treat any single factor as the solution. But an unfunded prevention function won’t hold up if challenged.

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What investment in prevention looks like

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Closing the gap does not require an unlimited budget. It requires a defined one, owned by someone specific, reviewed on a regular cycle, and reported against at board level. In practice, that tends to mean three things: a case management platform that replaces manual tracking and gives leadership real visibility into patterns, structured and recurring training rather than a one-off session, and a reporting cadence that puts speak-up data in front of the board often enough for it to shape decisions rather than sit in a file.

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Organisations that have made this shift consistently describe it the same way. It was never really about finding a large new budget. It was about being honest, for the first time, about what prevention actually costs to do properly, and choosing to fund it rather than absorb it.

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The full findings behind these figures, including the report's data on psychological safety, compliance readiness and board engagement, are available in the Culture Shifters Annual Report 26-27.