Is It Time To Retire Half Your Company Policies?

Most companies treat policies like insurance: when something goes wrong, they add another one.

A misuse of expenses? Add a rule.

A compliance concern? Add an approval step.

A rare edge case? Add a paragraph.

Over time, policies pile up. Rarely reviewed. Almost never removed. What starts as good governance slowly turns into a maze that employees struggle to navigate, even when they’re trying to do the right thing.

At some point, the policies meant to reduce risk begin creating it.

When More Policies Mean Less Compliance

There’s a widespread assumption that more rules equal better control. In practice, the opposite often happens.

As policies grow longer and more complex:

• Employees stop reading them and rely on memory or guesswork
• Managers interpret the same rules differently
• Exceptions become routine
• Work gets done through workarounds instead of clear processes

When policies are too hard to follow consistently, they stop functioning as controls. They become friction. And friction doesn’t stop behavior, it just pushes it out of sight.

Policy Sprawl Is An Operational Risk

This isn’t just an employee experience issue. Policy sprawl creates real operational risk.

For finance and compliance teams, overly complex policies often result in:

• Higher exception rates
• Longer approval cycles
• Inconsistent enforcement
• More manual review
• Greater reliance on individual judgment

Ironically, organizations with the thickest policy handbooks are often the ones struggling most with compliance. Not because people don’t care, but because the rules no longer match how work actually happens.

Good governance isn’t about more rules. It’s about clearer ones.

Why Policies Rarely Get Retired

Most companies are disciplined about adding policies and terrible at removing them.

A few common reasons:

• Policies are written in response to incidents, not as part of a long-term system 
• No one “owns” policy cleanup, so outdated rules linger
• Removing a policy feels risky, even when keeping it creates daily friction
• Teams assume complexity equals safety, even when evidence says otherwise

The result is a growing gap between official policy and real-world behavior.

What Actually Makes Policy Useful

Useful policies share a few characteristics:

• They are easy to understand and follow without interpretation
• They focus on intent, not edge cases
• They can be enforced consistently
• They align with how people actually work

If a policy requires constant explanation, frequent exceptions, or manual policing, it’s probably not doing its job.

A simple test:

If your most conscientious employee regularly violates a policy without realizing it, the policy is broken…not the employee.

When Fewer Policies Create Better Control

Some of the most effective finance teams take the opposite approach: fewer rules, better enforcement.

Instead of managing hundreds of clauses, they focus on:

• Clear principles
• Simple thresholds
• Automated checks where possible
• Human review only where judgment actually matters

This doesn’t reduce control — it improves it. When policies are understandable and consistently applied, compliance increases naturally.

A Practical Way To Start Simplifying

You don’t need a full policy overhaul to make progress. Start small:

1. Identify the policies with the highest exception rates
2. Look at where people consistently get confused
3. Remove or merge overlapping or out-of-date rules
4. Rewrite policies in plain language
5. Align policies with real workflows, not idealized ones

If a rule exists only to catch a rare edge case but slows down everyone else, it’s worth asking whether it still belongs.

The Goal Isn’t Fewer Rules…It’s Better Ones

Retiring outdated policies isn’t about being lax. It’s about being intentional.

In fast-moving, global organizations, governance needs to support decision-making not obstruct it. Policies should guide behavior, not require constant enforcement. Sometimes the best way to reduce risk isn’t adding another rule. It’s removing the ones that no longer serve you.

At ABUKAI, we often see that policy complexity grows fastest when enforcement is manual and data arrives in inconsistent formats. When finance teams can rely on clean capture and automated validation, they can replace layers of rules with clearer principles and still maintain strong controls. 

Contact us to learn more!