2.4 The Purpose of the implementation of Codes of Ethics of the Directors in Corporate Governance.
At the quarter of the 20th century, as technologies like internet have made world business or international business all more viable, the business ethics domestically have grown in importance along with the power and significance of major businesses. So that, directors code of ethics take center stage as a major concern of the modern era as most of the business are dealing with an international business. The earlier opinion stated that a business cannot be ethical, but this opinion is not used anymore in the modern business. Today business has belief that they must be responsible for social since they live and operate within a social structure.
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Code of ethics of the director’s aims to establish a standard of ethical behavior for directors based on trustworthiness and values that can be accepted, are held or upheld by any one person. In order to uphold the spirit of self and social responsibility in line with the legislation, regulations and guidelines for administrating a company the stated codes of ethics is established. In adopting the code of ethics, the company will recognized the vital importance of the company in conducting their business that subjected to the highest ethical standards and in full compliance with all applicable laws and, even where not required by law, with the utmost integrity and honesty.
2.4.2 Act as a guidance to the Directors
The most important things is that, the purpose of the establishment of the Code of ethics is that to provide guidance to Directors to help them recognize and deal with ethical issues, to provide mechanisms to report unethical conduct, and to help to foster a culture of honesty and accountability. Codes of ethics also can ensure the discipline of the directors.
2.4.3 Act as the Philosophy of an
An ethical audit is important to establish the company’s current weaknesses and strengths concerning how it conducts itself in an ethical manner. An ethics audit will involve evaluating the company’s standard of ethic, it ethic climate, and how well the company’s employees follow ethical standards. One of the first things to evaluate in an ethics audit is if a company has a written code of ethics and how comprehensive it is. Moreover, the written code of ethics should apply to everyone in the company from the top down with a clear zero tolerance policy in place for ethics violations. Included in a comprehensive ethics code should be a method for
Our Code of Ethics Program is designed to uphold the interests of every stakeholder of Given Company. Our mission is to uphold a high level of integrity by maintaining high company standards, values and principles to ensure the company meets its mission of being a good corporate citizen who is socially responsible. Our program provides effective guidance for daily decision making for all levels of personnel in an effort to establish and promote long-term relationships within Given Company and with our customers and community. The overall goal of the program is to be diligent in establishing a culture
Ethics, ethical values, and social responsibility should all work in unison in a corporate business structure. These key traits are better defined as maintaining overall good business morals, obtaining employees who possess personal ethical values, and finally to behave ethically and with sensitivity toward social, cultural, economic and environmental issues. For a business to better ensure these quality business traits a code of ethics should be adopted by the business. In the cases of Bernie Madoff and Enron, the most well-known financial scandals in history, I feel, gave a major hand in pushing business all across America to have and enforce the code of ethics.
Everything in life has a trade off. "Ethics is defined as the moral principles that govern a persons behavior." Ethics is constructed by society, and personal values, the purpose of code of ethics is that it gears all organizational conclusions, creating a groundwork in which all conclusions are drawn. This can benefit to build a sense of barriers through the organization. A well thought out code of ethics can assure a companies standing. Looking at the world of business and ethics, it is clear to see that there are many possible tradeoffs. One can be loyal to the company, and not have the best success, or one can be deceiving and manipulating in order to become rich and successful. The motivation for researching this topic is to see how the
Every company should have a code of ethics, because it maintains the company’s values, culture, and reputation. It communicates to employees that the company is committed to doing business responsibly. It also guides employees’ conduct and how they should interact with each other, customers, vendors, contractors, and the general public. Code of ethics set clear standards and expectations for employees, and if everyone in the company adheres to these policies, then the company will create a culture that reflects the code. Companies with code of ethics also show that they are committed to integrity and social responsibility, which in turn will make their customers feel more reassured, and help with the company's bottom line as well as protect the company from potential liability.
The company’s code of ethics required the employees to obey all safety laws, health and environment regulations. To conduct themselves in the community with good citizenship with in the corporate surroundings. Appropriate accounting was established for internal controls and record keeping to meet both legal and business requirements. Employees are expected to follow the policies and controls set by the accounting principles.
A code of ethics highlights the responsibility and accountability standards of each and every employee within the organization. These codes are also motivating factors that guide the employees’ behavior, set the standard regarding ethical conduct, and build an organizations trustworthiness within
Therefore, I agree with the author of the article, that code of ethics should do more than establish acceptable standards. With using code of ethics, accountants have an increased knowledge of how important it is to do what is right, which will in turn help to remain in compliance with rules and regulations. Having ethics should benefit the company not only to increase profits, but as a whole.
Ethics are values and principles that individuals use to govern his decisions and activities. Ethics are about moral judgment of an individual about right and wrong. In an organization, code of ethics refers to set of guiding principles and organizations use these principles in their policies, programs, and decisions for business. Within organizations, decisions are taken by groups or individuals and these decisions are influenced by the culture of the company. Decision making and relevance of ethics may also differ for nonprofit and for profit organizations. In contemporary business environment, organizations must have a clear ethical policy and implement it in proper manner. There are many social, legal and economic outcomes that company has to face in case of any ethical dilemma, so there must be a smart strategy to deal with ethical dilemmas. In this paper, we will address the ethics for nonprofit and profits organizations, ethical dilemmas being faced or faced by each of these companies and the outcomes of these ethical dilemmas. Critique of actions of each of these companies will be provided from the point of view of applicable philosophical theories of organizational ethics.
As many organizations have or seek to establish a global footprint, it is imperative that they establish a written code of ethics that clearly lays out what the company stands for as well as enforce it. This is required as it will establish the acceptable behaviors for those that fall under the code of ethics. Taking the time to develop this is key to successful interactions with internal and external shareholders as well as reducing negative perceptions by stakeholders.
In order for the directors and executives in any company to know that their employees are acting in an ethical manner, they need a defined
Urges the creation of a code of ethics by every corporation, to insure that the company's ethics are met by employees. ( Although a corporate code of ethics cannot prevent unethical behavior, but it can have an impact on employee decisions. If a worker knows that a certain course of action violates his company's ethical code, he is likely to give more thought to whether or not he should pursue that course of action)
The guidelines for code of ethics as established by the Federal Deposit Insurance Corporation (FDIC) develop a guide to encourage management of financial institutions, including the board of directors to spread their message of integrity and ethical values to all those involved with the organization. The suggested policies the FDIC encourage to be developed are:
First, we need to grasp how Codes of ethics were created and if formulated from a standard boilerplate Ethics program. As stated by FindLaw.com under ‘Corporate Ethics and Sarbanes-Oxley, in order “to create code of ethics, an organization must define its most important guiding values, formulate behavioral standards to illustrate the application of those values to the roles and responsibilities of the persons affected, review the existing procedures for guidance and direction as to how those values and standards are typically applied, and establish the systems and processes to ensure that the code is implemented and effective.” (Navran, 2003) A company can work to promote ethical behavior; however, the process is “not easily created from boilerplate.” (Navran, 2003) The process has been broken into five sections which can be seen below from Corporate.FindLaw.com, on the same page by Navran.
The Code of Ethics is to be used as a guide of the company values. This information will inform employees about the core values of Company X, along with an understanding of why having a commitment to the ethical conduct is a necessity.