British Petroleum's corporate code of conduct and ethical accountability

Corporate Ethics in the 21st Century

Corporate ethics has emerged as one of the leading business issues of the Twenty-First century. Scandals at formerly reputable corporations such as Enron have sullied the corporate image for the public, not to mention major shareholders. Transparency and accountability are the new corporate watchwords, as companies from all industries and at all levels of operation struggle to adapt to the new climate of corporate responsibility. One of the greatest weapons that corporations have developed to deal with these new circumstances is the corporate code of ethics, or sometimes the code of conduct.

At its most basic, a code of ethics is a "management tool for establishing and articulating the corporate values, responsibilities, obligations, and ethical ambitions of an organization and the way it functions" (Codes of ethics, n.d.: par. 1). Simply put, a code of ethics amounts to a written record of a corporation's policies. Sometimes this can amount to a few sentences that describe the loose corporate values employees should keep in mind when faced with an ethical dilemma like integrity or honesty. In more extreme cases -- usually limited to larger corporations -- detailed descriptions will be provided for the appropriate ethical response to moral quandaries employees might face in the workplace. In those cases, the code of ethics functions as a moral compass for employees, a clear means by which decision-making can always progress.

Ethical Inquiry: The Case of BP

The purpose of this study is to develop a preliminary model of inquiry into an existing code of conduct, the code currently being used at British Petroleum (BP). An examination of BP's code of conduct provides an interesting glimpse into the effects and difficulties of implementation of codes of ethics in the corporate setting. Less than five years ago, management at BP faced significant ethical criticism based on a number of questionable policies. These included association with Chinese oil interests in a bid to build a pipeline across occupied Tibet, environmental concerns about exploratory drilling in the Arctic National Wildlife Refuge, and implicit involvement with oil-driven conflicts in Sudan (Clark, 2001). In short, BP faced a number of major ethical quandaries, not to mention the run-of-the-mill variety associated with nearly all corporations such as fair business and accounting practices.

Many will no doubt argue that BP's days of moral crisis are far from over. Nonetheless, the company drafted a new and more comprehensive code of conduct as late as 2005, which explicitly describes expected and ethical employee behavior in a number of key conduct areas (Code of conduct, 2006). The development of this new code came on the heels of more stringent attempts to eliminate unethical behavior within the corporation. We must assume that this newfound sense of corporate responsibility was almost certainly driven by public scrutiny after other, very public, corporate scandals in recent years. Still, it's hard to argue with the results. In 2004, BP fired 252 of its own employees for unethical behavior ostensibly to weed out bribery and corruption. Most of the offenders were apparently guilty of theft, fraud, or harassment. That is a 50% increase in ethics-related firings at BP over the previous year and underscores the importance of the appearance of ethical compliance (BP sacked, 2005). A closer examination of BP's code of conduct reveals that implementation must and will continue to be difficult and will meet with implicit resistance throughout the corporate structure.

THe BP code of conduct is extensive and defines appropriate behavior in a myriad of situations. Employees could theoretically refer to it at any time they felt their own moral judgment might be compromised. It covers five main areas: health, safety, security, environment; employees; business partners; government communities; and company assets, financial integrity. An more detailed inquiry into the effects of this code in each of these identified areas will demonstrate the ambitious goals of BP's code of conduct and the unfortunate limitations that the code inevitably faces.

When and How Will the Code of Conduct Be Implemented?

BP recognized from that start that any successful code of ethics relies on "committed dissemination, implementation, monitoring, and embedding" (Codes of ethics, n.d.: par. 3). In other words, employees will not utilize the prescriptions of the code or integrate its values if they know nothing of it or don't believe that it will be enforced. A corporate code of ethics represents the law of the land for all ethical dilemmas employees might face. The first step in successful implementation is making certain that everyone knows there's a new sheriff in town.

To that end, BP's initial education and promotion programs were quite successful. Internal surveys revealed that following the rollout of the new code, 99% of employees had heard of the new code of conduct and 96% of all employees had a copy of their own (Code of conduct, 2006). The code of conduct cannot be thought of as act to be implemented once and then forgotten. If the values it embodies are to become an integral part of corporate operations, then management must take pains to ensure that the details of the code are fully incorporated at every level of the company. The long-term success of any code of ethics is dependent upon long-term commitment to the values and rules that it describes.

Who Needs the Code Anyway?

As has been evidenced from recent corporate scandals and debacles -- as well as the details of the BP code of conduct -- unethical behavior can occur at nearly every level within the corporation. Executives can be guilty of bribery and accounting fraud. Midlevel employees might face ethical problems dealing with harassment or unfair labor practices. Even the janitor who cleans up the office after hours might be tempted to steal office supplies. A corporate code of conduct provides all employees with a sense of corporate values and the dictated appropriate behaviors.

Probing Deeper in Conclusion: How Effective Should We Expect a Code of Conduct to Be in the Corporate Setting?

Corporate code of conducts are the "rage" in the business world at the moment. Transparency and accountability are seen as the best ways to restore public and shareholder trust in corporate policies. Having a code of conduct that is actively implemented must seem like the most visible way to regain that trust and reinstall a semblance of corporate ethical behavior. However, in the true spirit of inquiry, we should evaluate whether or not the grandiose values and lists of acceptable behaviors outlined in codes of conduct -- like BP's -- will really have the effect of improving the morality of corporate policies.

Unfortunately, corporate codes of ethics are not the same thing as a corporate culture, which cannot be artificially created no matter the best efforts of executives. We must return to our original definition of a code of ethics, which describes it as a management tool. In this sense, a corporate code of conduct is a tool used by corporate executives to advance certain policies and appearances, whether or not those values ever become integrated into the entire corporation. In order for a corporate code of ethics to be successful it must be fanatically pursued and enforced, with employees given no chance to violate its precepts. Otherwise, it simply becomes one more book of rules and guidelines that employees will dutifully file away upon receipt all the while continuing to avoid being caught for their knowingly unethical behavior. Unfortunately, most employees already know how they should act to be ethical within any corporation; they simply choose to act otherwise because they are motivated by other values that seem much more important such as ambition, greed, or egotism.