Developing a code of ethics: establishing a values-based approach to business.Question: Do you have guidelines for developing a code of ethics Code of Ethics can refer to:
Answer: What is a "code of ethics" and what does it mean? First of all, a code is "any system or collection of rules and regulations" (Code, 2006). The second part, ethics, can be considered "the rules of conduct recognized in respect to a particular class of human actions or a particular group" (Ethics, 2006). Using these definitions we can determine that a code of ethics is a collection of rules and regulations recognized by a particular group such as a company or association. Historically, Thomas Percival Thomas Percival (1740-1804) was an English physician best known for crafting perhaps the first modern code of medical ethics. He drew up a pamphlet with the code in 1794 and wrote an expanded version in 1803, in which he reportedly coined the expression "medical ethics" proposed the first code of ethics for physicians and surgeons Physicians and surgeons are medical practitioners who treat illness and injury by prescribing medication, performing diagnostic tests and evaluations, performing surgery, and providing other medical services and advice. in a pamphlet published in 1794 (Baker, 1999). Before codes of ethics were written, the idea of honor was first and foremost, so individuals did not want to be disgraced for doing the wrong thing or behaving in the wrong manner. "Percival drafted the first code of professional ethics professional ethics, n the rules governing the conduct, transactions, and relationships within a profession and among its publics. professional ethics liability, n 1. in response to a particular crisis arising from the mismatch between the personalized ethics of individual honor and the requirements for standardization inherent in a modern institute" (Baker, 1999). The first code of ethics to be adopted by a professional society was adopted by the American Medical Association American Medical Association (AMA), professional physicians' organization (founded 1847). Its goals are to protect the interests of American physicians, advance public health, and support the growth of medical science. in 1847 (Baker, 1999). Since the collapse of Eaton, ethics has been at the forefront of business discussions. Ethics used to be a topic covered in university accounting and finance courses, but now most business programs have an entire series of courses on ethics and how to make ethical decisions. The Sarbanes-Oxley Act See SOX. has also brought ethics to the forefront for public companies. In Section 301, SOX (1) (Schema for Object-oriented XML) An XML schema developed by Veo Systems and Muzino Communications, which was submitted to the W3C. SOX is based on DTD, but adds data typing and reuse mechanisms. requires the audit committee to establish procedures for the receipt, retention and treatment of complaints. Another provision set forth in Section 406 requires companies to institute a code of ethics for senior financial officers. Section 806 provides protection for those who provide information to suspected unlawful behavior (Ethics and Compliance ..., 2005). The stock exchanges expanded the reach of a corporate code of ethics even further by applying it to directors and employees (Ethics and Compliance ..., 2005). It is essential for any business, public or private, to have appropriate ethical guidelines in place. The following is a basic outline of what should be taken into account when writing a code of ethics. How Should the Code be Written? * To insure that the code is accepted by all employees, make sure they are involved in the development process. This includes all levels and departments (housekeeping staff to executive management). * The code should also be simple. If your company has a code of ethics 50 pages long, the chances are that your employees will not remember 75 percent of the content. * The code should be written in several stages. Write the first draft and distribute to department heads to let them evaluate the content. This process should happen several times until there is a general consensus on the document. * Consider your code of ethics a living document which will change over time. When new issues arise, make sure they are included in the code to keep the document up to date. What Should be Considered When Writing the Code? * First of all, each company must develop its own code of ethics and standards. There are industry specific issues which may apply to a large hotel management company that are irrelevant in a small country club setting. * The company's corporate culture and structure must also be addressed during development. Does the company have an open-door policy Noun 1. open-door policy - the policy of granting equal trade opportunities to all countries open door national trading policy, trade policy - a government's policy controlling foreign trade where employees feel free to express their concerns? * The risks, challenges and customs of the country where the company operates must also be addressed (Suggested Guidelines ..., 2005). For multinational companies this is an issue because each country has its own set of ethical and moral standards. What Should be Included in Your Company's Code of Ethics? * To emphasize the importance of the document, senior management should write an introductory letter for the code (Suggested Guidelines ..., 2005). The letter lets employees know that the code is supported by the entire company and its management. * The company's mission statement, vision, and values must be stated in the code and matched to the ethical guidelines laid out in the document (Suggested Guidelines ..., 2005). * Ethical framework for decision-making should be provided whether it is in the form of a series of questions or maybe a decision tree (Suggested Guidelines, 2005). The American Institute of CPAs (AICPA AICPA See American Institute of Certified Public Accountants (AICPA). ) provides a decision tree for ethical decision making. The AICPA advises its members that if an ethical conclusion cannot be met, then they should vacate To annul, set aside, or render void; to surrender possession or occupancy. The term vacate has two common usages in the law. With respect to real property, to vacate the premises means to give up possession of the property and leave the area totally devoid of contents. their position. * The document should also include a means for reporting unethical unethical said of conduct not conforming with professional ethics. behavior. Some companies have instituted an 800 number which allows employees to make anonymous phone calls to report unethical behavior. An ethics compliance officer can also be put into place to investigate disputes. * One of the most important pieces of a code of ethics is the section which discusses disciplinary actions that will be taken when there is a code violation. This section must spell out exactly what will happen when an employee violates the code. * The code should also provide examples of ethical and unethical behavior for your company. Examples provide a better picture for employees to follow, and can also reinforce the consequences which may occur. The following is a good rule of thumb to remember when trying to determine if a behavior is ethical: Would you be proud if it was published on the front page of your local newspaper? HFTP HFTP Hospitality Financial & Technology Professionals HFTP Hybrid-Fiber Twisted Pair recently approved a Certification Code of Ethics for the CHTP CHTP Certified Healing Touch Practitioner CHTP Certified Hospitality Technology Professional and CHAE CHAE Certified Hospitality Accountant Executive CHAE Centre for Higher and Adult Education (South Africa) designations. In a concise manner, HFTP provides a general overview of the certifications, professional characteristics, principles, professional conduct, discreditable dis·cred·it·a·ble adj. Harmful to one's reputation; blameworthy: discreditable behavior. dis·cred acts, guidance and enforcement, and actions pertaining per·tain intr.v. per·tained, per·tain·ing, per·tains 1. To have reference; relate: evidence that pertains to the accident. 2. to ethics investigations. The entire code can be viewed on the HFTP web site under the "Certifications" link. References * Baker, Robert. (1999). Codes of Ethics: Some History. Retrieved September 1, 2006, from http://ethics.iit.edu/ perspective/pers19_1fal199_2.html. * Code. (2006). Retrieved September 8, 2006, from www.dictionary.com. * Deloitte: Corporate Governance Corporate Governance The relationship between all the stakeholders in a company. This includes the shareholders, directors, and management of a company, as defined by the corporate charter, bylaws, formal policy, and rule of law. Services. (2005). Ethics and Compliance: The Advantage of a Values-based Approach. Retrieved August 25, 2006, from www.deloitte.com. * Deloitte: Corporate Governance Services. (2005). Suggested Guidelines For Writing a Code of Ethics Conduct. Retrieved August 25, 2006, from www.deloitte.com. * Ethics. (2006). Retrieved September 8, 2006, from www.dictionary.com. Contact Information: Tanya Venegas, Program Coordinator HFTP Research Institute 001 (713) 743-1839 or (866) 572-4387 Fax: (713) 743-2548 E-mail: hftp@hrm.uh.edu Web: www.hrm.uh.edu/hftp |
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