Creating a Company Code of Ethics: An Example

A clear code of ethics in business is important to ensure that everyone working for a company understands what the company’s guiding principles are, and how they should be applied in practice. Areas covered by a code of ethics include:

The work environment

Establishing a work environment where everyone can be happy and productive is crucial for a company’s long-term success. Having a code of ethics helps to create and maintain a positive work environment for all employees.

Resolving conflicts of interest

To maintain the integrity of the company, it’s important that employees understand when conflicts of interest arise, and how they can deal with them professionally.

Anti-bribery and corruption

Especially for companies who sell to governments, it’s critical to have robust policies covering bribery and corruption, so that the company and its employees are fully protected by the law.

Employee behavior

A code of ethics will help to establish clear policies and professional standards of behavior for all areas of employee behavior, such as acceptable use of company infrastructure. Learn More: 6 Things You Should Never Do On Your Work Computer

A good place to start is with your own personal code of ethics: what core values do you follow? What values do you want others to follow? Some examples of ethical codes which make a good starting point:

Treat others as you want to be treated

A fundamental basis of many general ethical codes is the rule of ‘do as you would be done by’ – treat others as you would want to be treated.

Be honest and open

Honesty is another fundamental principle many people use to guide their relationships with others. Making it a central tenet of your code of ethics will help embed honesty at all levels of the organization.

Keep your promises

Being trustworthy is about more than telling the truth: it also means doing everything you say you will do. Reliability is a crucial part of business success, so it’s worth including in your code of ethics from the start.

Act in accordance with your principles

It’s not enough to simply have good principles: you need to act on them. Senior company leadership can lead by example here. If employees see their business management not only creating a code of ethics but obviously living by it, they will be much likelier to follow the code themselves.

The exact contents of your code of ethics will vary depending on the type of business. However, as well as the basics outlined above, it’s an excellent idea to include the following:

Reference to relevant laws

A company’s employees should always follow the laws of any territory where the company does business. It’s worth spelling this out in the code of ethics to avoid misinterpretations.

Professionalism

Employees should act in a professional manner towards each other and external parties at all times, which may include manner of dress, language used, standards of behavior, and so on.

Inclusivity

A company is stronger when it employs people from a variety of backgrounds, when all points of view are taken into consideration, and when all employees feel valued. It’s important to spell out that inclusivity and diversity are strengths, and that discrimination is unacceptable. Learn More: Top Companies for Diversity and Inclusion

Treating others with respect

Employees should treat all people they encounter with respect and consideration — other employees, customers, suppliers, regulators, and so on.

Stakeholder opinions

As well as thinking about your own personal ethics, it’s also worth gathering the opinions of your stakeholders and incorporating them into your code of ethics. A code of ethics is much more likely to be well-received — and followed — if those who are affected by it have given input and agreed to it in advance. Stakeholders include employees, clients, and others who are affected by the way you do business, for example, local residents.

A code of ethics and a code of conduct are similar, and in many cases may be included in the same document. A code of ethics is more general: it lays down the underlying principles behind how a company does business. A code of conduct goes into a greater level of detail and includes more specific situations relevant for the company’s area of business. It’s a good idea to create the code of ethics first, and then use that as the basis for a more comprehensive code of conduct.

The company code of ethics should be clear and concise so that it’s easy to read and understand. Ideally, it should be produced in a style that matches the company’s usual branding. Also worth including are:

A one-page summary at the start

A quick overview that can be made into a poster or simple presentation slide helps make the code of ethics memorable and easy to communicate.

Illustrations

A visually appealing document will be more eagerly received than one that looks dull. Visual learners will also benefit from a document that isn’t too text-heavy. Photographs, visualizations, and infographics can all help get the message across.

Clear examples

It’s usually easier to understand a point about ethics if there are examples provided of what to do in a given situation, for example, if a client or third-party offers you a bribe.

Sample responses

It’s also helpful to provide template responses to situations, like giving a sample response on how to decline a bribe without causing offense. These can be done in an appendix or supplementary document so that the code itself is kept short and concise.

Routes for reporting

The code of ethics needs to be enforced, so it’s important to establish how disputes will be resolved and how employees can report others who violate the code. Learn More: How to Complain While Still Sounding Professional

By now you should have a good idea of what a company code of ethics is, and how to start creating one. Here is an example code of ethics that you can use as the basis for your company’s own document:

Respect and consideration for others

In this company, we treat all individuals with respect and consideration at all times. We recognize that diversity of all kinds is a strength. We treat others as we wish to be treated ourselves.

Respect for the law

We follow all applicable laws and regulations in all the territories where we do business, and we promptly report anyone we see breaking the law. We do not accept or offer direct bribes or engage in any other form of corruption.

Professionalism

We act at all times in a professional manner towards employees, suppliers, customers, and other external stakeholders. This includes maintaining professional standards of dress and communication, resolving disputes amicably, and maintaining appropriate behaviors in the workplace. Inappropriate behaviors — including but not limited to unwanted sexual contact, substance abuse, persistent absence, and acts or threats of violence — are reported promptly and dealt with strictly, regardless of seniority.

Honesty and integrity

We are honest and open in all our communications, whether external or internal, and we act with consistent integrity throughout our business.

Adaptability

We are responsive to the changing needs and environment and recognize that our code of ethics needs to adapt as our business evolves. Any employee can make suggestions for improvement via the established feedback channels.

Communication

Once the code of ethics has been created, it needs to be communicated to the workforce. Depending on the size and geographic spread of the company, this can be done either by central communication or via a cascade to local teams. To ensure the message is communicated effectively, take into account differing communication styles. Learn More: QUIZ: What’s Your Communication Style?

Enforcement

The company code of ethics then needs to be enforced, consistently and visibly, to ensure compliance at all levels of the company.

Regular updates

As the business expands and moves into new markets and territories, and as the regulatory environment changes, it’s important to review the code of ethics regularly to make sure it’s still fit for purpose. As we’ve seen from the example code of ethics, this isn’t a one-off exercise, it’s a living document that informs all the ways in which a company does business. Create one today for your business, and enjoy the benefits both in the short-term and the long-term.