Codes of Ethics

Date: 2015-10-07; view: 585.

Ways of Improving Ethical Performance

Organizations have taken various actions to improve the ethical performance of their managers and employees. These actions include developing codes of ethics, organizing ethics committees, conducting social audits, and providing ethics training.

A code of ethicsdescribes the general value system and ethical rules that the organization wants its employees to abide by. Ethical codes are developed to describe the organization's purpose, establish a consistent ethical climate, and provide ethical guidelines for decision making.

The types of behavior generally prohibited in codes of ethics include bribery, extortion, gifts, kickbacks, conflict of interest, falsifying of corporate accounts, violation of laws in general, fraud, revealing company secrets, use of insider information, illegal political payments and illegal behaviour that serves the company. It is common practice for organizations to communicate ethics codes to their employees through printed material, although some organizations also conduct ethics workshops.

When developing codes of ethics for doing business in multinational settings, it is important for a company to consider the foreign culture's attitudes toward gifts and bribery. Making small payments to foreign government officials to expedite action is both customary and expected in some countries. So, companies doing business in foreign countries should develop an ethical perspective toward conducting multinational business.