Suddenly tired, I told him that I’d been a journalist for 35 years, and that I had never gotten the summons to join the conspiracy. He couldn’t hear me.
Some people think it’s OK to go out to dinner with a big shot and give him some good press the next day. Some people think it’s fine to take a ream of paper from the office supply room for use at home. Some bosses pay men more than they pay women for doing the same work. Some companies teach their employees to lie to customers. Some managers are bullies, or overlook bullying among the rank and file.
Some people have strong ethics, and won’t put up with any of the above. The majority, I think, will put up with unethical behavior for a long time, until pushed to the wall. Some, alas, sign on to the practice, and are lost forever.
Ethics is not just an idea. It’s a field of study of human behavior. If a company’s employees have chronic issues with one another or with the management, chances are good that it’s an ethical problem. If your employee turnover is high, chances are good that the pay is too low or that ethical standards are loose.
Larger companies, those with human resources personnel, tend to have organizational structures that include a mission statement and a code of conduct. The code is the place where ethical practices are outlined. Small businesses tend to operate with less formality, but having a basic code of conduct is helpful regardless of size, especially if an unforeseen circumstance arises to test the ethics of the company and its leaders.
Preparing a code of conduct isn’t difficult, though adhering to it can be tough for some people.
Ethics in the workplace combines two aspects of daily life: law and order, and morality. In some societies the distinctions between these are blurred, but in the Western world they are fairly discrete. Law concerns itself with the physical well being of citizens and the orderly functioning of society; it identifies crimes and sets forth punishments.
Morals derive from beliefs about behavior on the inner landscape, and are found in religions, close-knit social groups, and contemplative individuals. Within a span of 700 years, from about 900 BCE to 200 BCE, four wholly different and separate groups developed what we call today the Golden Rule: Do unto others as you would have others do unto you. The Chinese, the Indians, the Greeks, and the Hebrews distilled ethical thought into the one sentence that has been the cornerstone of moral thought ever since. (See The Great Transformation, Karen Armstrong, 2006.)
In essence, law declares that we must not harm others, and morality gives the reason. The moral aspect of business ethics generally goes beyond the provisions of the law. One example of this could be environmental protection. Local, state and national laws set forth the legality of certain environmental practices, but a company might choose to set a higher standard for itself and its employees. Other such areas can include occupational health and safety, discrimination, harassment, confidentiality, and responsible business practices, meaning prohibitions on gifts, nepotism, and so forth.
The idea of a business code of conduct is both embraced and reviled. Its detractors say that such a policy document exists to serve only the owners and the managers and their practices. Proponents praise them as tools for improvement across the spectrum of operations. Cornelius von Baeyer, a management consultant from Canada who specializes in business ethics, put it this way: “We hear that codes are useless – hypocritical window-dressing to mask continuing corruption. We hear that codes are great – a crucial step on the way to enhanced corporate productivity, credibility and profitability.” There is no definitive statistical study that shows once and for all whether codes work or not, he says. “This will dishearten some. But there is considerable information that codes, along with other measures, have helped pull some companies out of the morass of scandal, and have helped many companies build a healthier work climate and reputation.”
What’s in a code of conduct?
If you are interested in creating a code of conduct for your business, or re-creating the one you have already, you can find out a great deal online, including the actual codes of conduct for corporations of all sizes. Most of the topics covered in such codes are not industry-specific, but rather are applicable to any business.
Here is a distillation of topics that probably should be addressed in a code of conduct. Legal input should be sought during preparation.
• Communication: I’m putting this first because without it you have a dysfunctional company. It’s complex, difficult to maintain and frequently overlooked. It means providing accurate information to the general public and the business community about your products and services. It means sharing information with employees, thoroughly and regularly, and making sure they know that your company holds their well being in high regard. Today’s buzzword is transparency, and transparency relies heavily on communication.
• Employment practices: This is a clear statement of the company’s guiding principles with respect to hiring, promotion and compensation; the work environment; harassment and discrimination, and related matters.
• Conflicts of interest: As in all sections of the code, the language here should be simple and direct – Divided allegiance is unacceptable, as is use of confidential information for personal gain. The list of examples should be specific and thorough.
• Financial integrity: The declaration that all accounting practices and procedures are in accordance with all applicable laws and regulations, and that false or misleading transactions, records and reports are prohibited.
• Gifts, favors, entertainment: Gifts from third parties to employees might influence business behavior. The code should establish specific guidelines for gifts, including entertainment and meals, even going so far as to set a limit on the nominal value of a gift – say $50, or $0.
• Misuse of company assets: Here’s a big category. It includes electronic systems, equipment, documents, facilities, materials, supplies, and more. Misuse means using these items for personal use or personal gain.
• Health, safety and environment: State up front that you intend to comply with regulations fully, and even exceed the standards, if possible. (Set up an environmental team within the company, drawing from all levels, and encourage team members to suggest new ways to conserve energy and reduce waste.)
• Inside information and insider trading: This is serious stuff, and your legal people should be directly involved. Even if your company is not publicly traded, you’ll want your views on confidentiality to be understood without question.
• Competition and antitrust laws: Price fixing, bid rigging, all that and more. Another chapter for the lawyer.
• Substance abuse: This is self-explanatory. Management should be aware that such abuse is not the province of any particular economic class.
• Transacting international business: Another complex subject that changes by country, and covers bribery of public officials, circumvention of local laws, and antiboycotting laws.
It is helpful, in the spirit of openness, to include the reasons for each declaration of conduct. The code is, after all, a collection of prohibitions, and the document could come across as a big list of don’ts. Emphasizing the positive aspects of compliance – how it will improve the company as a whole as well as each individual – could mitigate any perceived negativity.
The author is president of Jack Kenny Media, a communications firm specializing in the packaging industry, and is the former editor of L&NW magazine. He can be reached at email@example.com.