Ethics Tools

The diagram below shows the continuous cycle of managing an ethics program in your organisation. Initially, this cycle will be used to develop an ethics management program in your organisation. After full implementation, these steps need to be repeated at least annually to review your current process and make the necessary adjustments and corrections to your program. This continuous management of your ethics program will prevent it from becoming a file in the cabinet as opposed to a working document which should be entrenched in the organisation’s being. 

Ethics Risk Management

Before developing a Code of Ethics for your business, it is important to first identify what the specific risks for your business/organisation are, and what can be done to minimise these risks. This risk assessment will guide you to identify what should be focussed on when developing your codes.

An ethics risk assessment will identify the threats of unethical behaviour and the opportunities for ethical behaviour and ethical performance.

King 2 states that the Board is responsible to conduct a proper risk assessment of the following:

• Physical and operational risks
• Human resources risk
• Technological risks
• Business continuity and disaster recovery
• Credit and market risks
• Compliance risks

Further to conducting risk assessments, King 2 also requires the board to have a risk management process in place, which includes risk reporting.

When conducting a risk assessment, the following steps can be used as guidelines:

State/identify the risk. Risks could be identified in the following areas: new technology, implementation issues, timing, research and development, impact on suppliers or customers, competition, labour issues, knowledge and skills, quality requirements, sales and throughput, strategic fit, policies/procedures/processes, impact on the environment (social/physical).

Plan protection: This can include avoiding actions or contingent actions.

Evaluate possible protection plans in terms of practicality, cost effectiveness, stakeholder buy-in. Agree on possible scoring plan to later evaluate the implementation.

Finalise plan: Test the plan by asking if the steps will address potential problems.

Click here to view a video about what are the risk management process steps.

Apart from the more strategic risk assessment above, companies could also find a Value Survey amongst employees useful to find out what the strengths and weaknesses are in this regard. A value survey could cover fields like employee beliefs, communication, leadership, equity, organisational awareness, knowledge and view of rules and regulations in the company.

Code of Ethics

A credo or value statement generally describes the highest values to which the company aspires to operate. It contains the `thousands. A code of ethics specifies the ethical rules of operation. It's the `thou shalt not's.

Those opposed to ethical codes say that too often much focus is put on the codes themselves and that codes themselves are not influential in managing ethics in the workplace. They argue that it's the developing and continuing dialogue around the code's values that are most important.

Employees could also react to codes with suspicion, believing the values and codes are for window dressing. But, when managing a complex issue, especially in a crisis, having a code is critical. More important, it's having developed a code.

In the mid-70s, Johnson and Johnson updated their credo in a series of challenge meetings. Bob Kniffin, Vice President of External Affairs, explains, "We pored over each phrase and word. We asked ourselves, `Do we still believe this?' Our meetings resulted in some fine-tuning, but basically, we didn't change the values. The meetings infused the values in the minds of all of our managers." Many believe this process guided them in their well-known decision to pull Tylenol bottles off the shelves and repackage them at a $100 million expense. Kniffin offers some sound, practical advice. "In a crisis, there's no time for moral conclusions. Get those done beforehand. But also realize there's no substitute for sound crisis management. For example, have a list of people with fundamental knowledge, such as who transports your products where and when."

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Developing Codes of Ethics

Codes of Conduct

Codes of conduct generally specify actions (behaviours) in the workplace. Codes of ethics on the other side are general guides to decisions about those actions. Codes of conduct are also focussed on smaller entities within the organisation, for example, departments, whereas codes of ethics are developed for the organisation as a whole.

If your organization is quite large, including several large programs or departments, you may want to develop an overall corporate code of conduct, and then a separate code to guide each of your programs or departments.

Click on the link/s below to open the resources.

Guidelines when Developing Codes of Conduct

Policies and Procedures

Update policies and procedures to produce behaviours preferred by the code of conduct, including personnel, job descriptions, performance appraisal forms, standard forms, checklists, budget report formats, and other relevant control instruments. In doing so, avoid creating ethical dilemmas such as conflicts of interest or infringing on employees' individual rights.

There are numerous examples of how organizations manage values through the use of policies and procedures.

• To produce behaviour aligned with the value of social responsibility, organizations often institute policies such as recycling waste, donating to local charities, or paying employees to participate in community events.
• A high value on responsiveness to customers might be implemented by instituting policies to return phone calls or to repair defective equipment within a certain period of time.
• Consider the role of job descriptions and performance appraisals. For example, an advanced technology business will highly value technical knowledge, creativity and systems thinking. They use job descriptions and performance appraisals to encourage behaviours aligned with these values, such as rewarding advanced degrees, patents, and analysis and design skills.

Include policies and procedures to address ethical dilemmas. (see the section on “Ethical Dilemmas”)

Include policies and procedures to ensure the training of employees about the ethics management program.

Include policies and procedures to reward ethical behaviour and impose consequences for unethical behaviour.

Include a grievance policy for employees to use to resolve disagreements with supervisors and staff.

Consider establishing an ethics "hotline." This function could be provided by an outside consultant or an anonymous "tip" box in which personnel can report suspected unethical activities.

Once a year, review all personnel policies and procedures. Consider including representatives of as many stakeholders as possible in this review.