Business ethics are good for company performance, but the tone has to be set from the top
Much is written about the role, indeed duty, of the board in setting the ethical values of the organisation. A board is responsible for determining, articulating and communicating the values and standards of the business, and for ensuring that the policies, procedures and controls in place act to embed, rather than hinder, ethical values throughout the business.
But can boards demonstrate that they are committed to ethical standards and their application to the way they govern and conduct themselves?
The business case for business ethics has been well demonstrated through the costs and impacts of the repeated high profile cases of corporate greed and misconduct. Often those integrity failures are a result of senior individuals crossing ethical boundaries as well as ignoring or circumventing the rules set out in law.
In today’s environment, stakeholders have high expectations that companies should be run in accordance with good corporate governance practices – it is the directors which bear ultimate responsibility for the business. So if corporate governance lies at the very heart of the way businesses are run, it is imperative that ethical values should be part of what makes those hearts beat.
The right choices
Questions of ethics, or the “right way to run a...