Before delving deeper into how ethics and conduct assist an organisation in not losing sight of its moorings during pressing and challenging times, it is immensely significant to understand the meaning and finer nuances of ethics and conduct.
Ethics and Conduct
Ethics is knowing the difference between what you have a right to do and what is right to do.
– Potter Stewart, Retired Supreme Court Justice of the United States
An amalgam of sets and rules distinguishing right from wrong, enabling informed decision-making, is referred to as ethics. Conduct provides a roadmap, ensuring the business runs smoothly during challenging times or day-to-day workings.
Whilst ethics influence judgement, conduct influences employees’ actions, thus making the scope of ethics extensive in nature, in addition to its public disclosure.
Role of the Employees
Employees are an organisation’s first line of defence in upholding the essence of ethics and conduct. In a survey conducted by the Gallup Panel of the U.S. working population, the percentage of employees seeing or being aware of unethical behaviour in their workplace was 24%, and 47% of these employees chose to report the issue (Gallup, 2020). The reason for such low reporting was that employees did not think speaking up would do any good as no action would be taken, followed by fear of reprisal and negative reporting experiences in the past (Gallup, 2020). The employees could take the following steps as a robust ethics and conduct framework will go a long way in addressing the concerns cited and improving compliance in the long run.
- In-depth conversations with colleagues to find behaviour drivers.
- Support upstanding behaviour.
- Areas of risk- identify and work on them proactively (Gallup, 2020).
Many organisations like Tata Steel, named one of the World’s Most Ethical Companies by Ethisphere in 2020 (TATA STEEL, 2020), have reaped the benefits of ethics and conduct by ingraining it in their organisational set-up, driving workplace performance (Industry Week, 2021).
Role of the Management
The data collated in Germany in 2016 (Gallup, 2020) will help put things into perspective and answer a pertinent question as to why the management’s intervention is required.
- 31% of employees admitted to remaining quiet about a grave concern at least once.
- One in five said they were silent three or more times about apprehension in the workplace (Gallup, 2020).
Workplace ethics and conduct are the prerogatives of the management, with the tone set by it permeating the organisation and affecting its workings immensely. It should be a topic of discussion and fall under the management’s purview to ensure employees are aware of what it comprises because a study found that 9% of employees were unsure if what they saw was a real violation of ethics or law (Gallup, 2020). The management could take the following steps to incorporate it into its DNA.
- Make business ethics and compliance a topic of discussion.
- Provide employees with the opportunity to discuss and fine-tune their moral compass.
- Give freedom to employees to reflect on and question without fear the various workplace scenarios.
- Set ethical behaviour and conduct expectations early on and emphasise them often.
- Create a culture that encourages ethics and conduct.
- Compliance training (Gallup, 2020).
Time is of the essence, and with the unstinted support of the employees coupled with the commitment of driven management, its realisation becomes easy. It will also ensure that the organisation can sidestep any consumer backlash if any such concern crops up.
Advantages of Integrating ESG
The business landscape has witnessed tremendous changes in the last century alone. Globalisation in its wake has seen organisations work more closely with each other than ever before, forming long and fruitful interconnections. These interconnections have also sometimes fallen under the law’s microscope, as evidenced in the case of Apple in 2019, implicated in a breach of labour regulations linked to its manufacturing partner, Foxconn (Security, 2021).
Integrating ESG practices helps an organisation immensely. Center for Audit Quality found 95% of S&P 500 companies provided ESG information to the public. These companies see a direct connection between ESG and ethics in consumers’ minds and know consumers factor ESG transparency into their purchasing decisions (Forbes, 2022).
Once established, the corporate world stands to benefit significantly from ethics and conduct as it gives the liberty to the employees to raise red flags in time, averting widespread disasters. To ensure its perpetuity, it needs managerial commitment and reinforcement from astute leadership.
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