Leadership: Codes of Conduct

Question 1

Code of conduct

Answer 1

• Also known as code of ethics
• Principles of conduct that guide decision making and behavior in an organization.

Question 2

Written code of conduct helps the organization by

Answer 2

• Promote ethical behavior
• Communicates to all employees the commitment to certain values
• Gives direction to all employees who are faced with an ethical decision
• Defines behavioral expectations

Question 3

What should be included in the code of conduct

Answer 3

• The needs, concerns, and values of the organization that creates, adopts and uses
• No definitive set
• Everything in there should be meaningful and useful to the organization

Question 4

An effective code of conduct

Answer 4

• Management can support by example and investment
• Employees can understand and apply

Question 5

Purpose of code of conduct

Answer 5

• Communicate values
• Guide action

Question 6

Parts of the code of conduct

Answer 6

• Value-based
  
  • Describes the organization’s principles and obligations to its internal and external stakeholders.
• Rule based
  
  • Defines the organization’s ethical expectations.

Question 7

Value-based part of code of conduct includes

Answer 7

• Communication from leadership reflecting commitment to the code and its enforcement.
• The organization’s mission statement and/or vision statement.
• A broad statement of organizational values and principles.
• A more detailed statement of the organization’s ethical obligations to all its various stakeholders.

Question 8

Rules-based part of the code of conduct includes

Answer 8

• Ethical and conduct guidelines
  
  • Ex: policies regarding conflict of interest, bribery/corruption, confidentiality, privacy, harassment
• Examples of ethical and unethical behavior
  
  • Help employees recognize a potential risk or conflict when it arises and questions employees can ask themselves to assess the ethical impact of their actions.
• Rules of conduct required to comply with laws and regulations. This may be a function-specific document.
• A description of the enforcement process,
  
  • Including how suspected violations should be reported, how and by whom reports will be investigated and assessed, and how employees will be penalized for violations.

Question 9

Who should be involved in Code of Conduct creation (or revision)

Answer 9

• Commitment from leaders
• Stakeholders
• Legal
• HR
• Executive team

Question 10

Steps in code of conduct creation

Answer 10

1. Gather information
2. Draft and review
3. Adopt the code formally and communicate to the organization
4. Monitor enforcement
5. Evaluate and revise the code periodically

Question 11

Gather information step in code of conduct creation

Answer 11

• Gather information from stakeholder through survey and focus groups about ethical risks and conflicts that have encountered and important compliance requirements
• Use external and internal stakeholders

Question 12

Draft and review step in code of conduct creation

Answer 12

Creating an effective code that is:

• Clear about its objectives
• Understanable
• Equips employees to respond to real situations

Question 13

Accept the code formally and communicate to the organization step in code of conduct creation

Answer 13

• During new hire orientation
• More than just distributing - key points should be reviewed and employee understanding confirmed

Question 14

Monitor enforcement step in code of conduct creation

Answer 14

• Auditing the presence and effectiveness of the enforcement
• Inconsistency in enforcement can have legal consequences

Question 15

Evaluate the code periodically step in code of conduct creation

Answer 15

• Change code when needed with changes in the organization and external environment
• Revised code should be reviewed and reintroduced to employees

Question 16

Ensuring Global Acceptability and Accountability of Organizational Code of Conduct

Answer 16

• Assemble an international task force on which all affected cultures are represented.
• Solicit feedback from a diverse cross section of employees; be sure to involve workers from all locations, levels, and functional areas.
• Identify a set of shared principles and develop mutually agreeable policies to address each one. Incorporate enough detail to effectively monitor and measure compliance and enough flexibility to accommodate variations in local practices.
• Ensure that training materials are available in the local languages and that translations are accurate and sensible.
• Avoid home-country biases. Choose words that are nonjudgmental and that translate well into other languages (for example, “business practices” and “corporate responsibility” rather than “ethics” and “integrity”). Limit references to specific regulatory instruments to those that are international in scope (for example, the OECD Convention on Combating Bribery of Foreign Officials in International Business Transactions rather than the U.S. Foreign Corrupt Practices Act).
• In addition to a company-wide code of conduct, consider creating ethical guidelines specific to at-risk personnel such as salespeople in countries where bribery is prevalent.