Business Code of

Ethics

Lets Define a
Code of Ethics..

A code of ethics is a formal

document rather than merely an
"environment," an "understanding," a
consensus, "unwritten rule," or just an
aspect of "corporate culture." It is at
minimum a published document. In many
organizations employees are also required
to sign a statement to the effect that they
have read and understood it.

Codes of ethics are free-standing

expressions of corporate will even when
they are published as chapters or sections
in a document which may contain a
mission statement, a listing of corporate
values, and general policies relating to
operations

Every code of ethics is different and

should reflect the company's ethos, values
and business style. Some codes are short,
setting out only general guidelines, and
others are large manuals, encompassing a
huge variety of situations.

As an example..
Kraft

The Kraft code of ethics contains just 10 short

rules of ethical behavior that all employees must
follow. The introduction to the Kraft code of ethics
suggests that employees should let values guide
their actions in all cases. The code also stresses
that if something seems wrong, it should be
addressed directly. The code includes a speaking-up
policy that requires employees to speak up if they
are aware of any violations of the code, even those
they have committed themselves.

The 10 rules are:

1. Make food that is safe to eat
2. Market responsibly
3. Treat people fairly
4. Respect the free market
5. Compete fairy
6. Respect the environment
7. Deal honesty with the government
8. Keep honest books and records
9. Never trade on inside information
10. Give Kraft Foods your complete
business loyalty.

Colgate-Palmolive
The Colgate-Palmolive code of ethics is a long
document, but is broken down into individual areas of
conduct. The code is intended as a guide to all daily
business interactions and is used in conjunction with
the company's business practice guidelines. The
code covers 10 areas, including: Our Relationship
with Each Other; Our Relationship with the
Company; Our Relationship with Consumers; Our
Relationship with Government and the Law; Our
Relationship with Society and Our Relationship with
the Environment.

Codifying ethical standards

Four key decisions in code design
1. Purpose Objective, aim?
2. Format Values or rules?
3. Content Components?
4. Implementation From paper to
practice?

What purpose should the

Code serve?

Decision 1: Purpose of the

Code
Various considerations
Prevents unethical behavior
Promotes ethical behavior
Provides guidance in ethical decisionmaking
Promote reputation
Pacify stakeholders

What should be the

format of the Code?

Decision 2: Format of Code

ASPIRATIONAL
DIRECTIONAL

Positives

Positives
-

short
recallable
discretion

Negatives

Negatives
-

specific
enforceable
sanctions

vague?
enforceability?

Integrated
Values & rules

discretion?
recallability?

What categories of
content should be included
in the code?

Decision 3: Content of the

Code

Rationale
Values
Guidelines for conduct
Guidelines for ethical-decision
making
Sanctions
Resources and references

Decision 4: Implementation of Code

Without proper consideration to
implementation, the Code will remain
mere words on paper
Planning for implementation to start
before Code completion

Thats All
Thank You!!