The Policing Of Corporate Ethics
There has been much attention in recent years to corporate ethics, thanks in part to some well-publicized scandals in the business world. Directors, officers, auditors and others in a position of power, are aware that their accountability is now under increased public attention and scrutiny.
It is advisable for any business to adopt a formal corporate ethics program. Evidence strongly suggests that employees are more likely to report any employee misconduct when their employer has a formal ethics program in place. It’s important for an employer to provide ethics training to employees, covering written standards of conduct and the process involved in ensuring that the reporting of employee misconduct is kept completely anonymous.
It should be noted however that ethics training alone doesn’t do the trick. A solid corporate ethics program is dependent on the behavior of those in power. Corporate ethics is contingent upon both education and leading by example. Employees will typically follow the lead of the behavior of top management. Management, from the CEO on down the chain of command, is expected to be a model of ethical behavior. If high positioned employees and CEO’s are known to routinely compromise ethics, whether it’s for company or personal gain, there will be no urgency for other employees to report ground level misconduct. Far too often, sometimes due to the political environment within an office or company, employees will be hesitant to report misconduct. Perhaps there is a pattern where the reporting of employee misconduct goes without action, suggesting that upper management have already compromised the ethical standards of the company. Some employees may even fear that their reporting will not remain anonymous, potentially jeopardizing their job, reputation and office friendships, due to office politics.
This is why many companies and organizations have gone as far to appoint an outside ethics officer to monitor behavior. An ideal corporate ethics officer will typically come from a legal or accounting background so they are familiar with regulatory-compliance issues. Some companies may look for a candidate with a deep understanding of their business model, for instance someone experienced with the ins and outs of the health care or retail industries, more so than a legal and/or numbers perspective. An ethics officer is both proactive and reactive in the sense that they should strive to make ethical practices well known throughout the company while also responding to varied complaints and addressing them with proper department heads. The role of policing corporate ethics should be kept separate from Human Resources and upper management in most cases. The ethics officer is serving as an independent agent, a middleman of sorts, for employees to take the reporting of ethics abuse or fraud to without any worry or concern of how they will be perceived and how the issue will be addressed.
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