Ethical code for a company

Code of Ethics

Introduction and Company Background

Guiding Principles

Purpose of the Code

Core Values

Training and Education

Covered Employees

Implementation and Communication

Enforcement and Reporting

Mission Statement

Code of Ethics: The XYZ Company

Introduction and Company Background

Having a code of ethics is a big part of doing business. It is not something every company has, but those that do have these codes provide them because they want to be ethical and strong. Ethical codes help make requirements clear for every employee, and can avoid discrepancies in conduct (Clark, 2012). Avoiding or lessening the possibility for misunderstandings and discrepancies is an excellent way to protect both the company's bottom line and its reputation. Employees who fail to act in an ethical manner can cause serious harm to the companies for which they work (Clark, 2012). Keeping that in mind, one must ensure that an ethical code is direct and clear, so employees cannot question it or get around issues that are ambiguous (Clark, 2012). There should not be any guesswork within the code, and it must follow applicable laws and industry regulations in order to be acceptable. The company will then have recourse against employees who violate the code.

In 1943, the XYZ Doodad Company was founded by Michael Tyler-Harris. When he retired, his daughter Amanda took over the operations. The company has been kept in the family, and remains that way today. It is currently a global business that operates on a multi-million dollar level, and because of its expansion and value, its code of ethics must be strong and clear. In the past, there have been some difficulties with ethical issues based on choices made by employees. While these employees no longer work for the company, its image has still been tarnished by their antics. Transparency is an important part of the company's ethics, and it is vital that the company remains open and honest with employees, clients, and vendors. This transparency helps to show that the company is dedicated to doing the right thing, but there is also a certain level of risk in it. As long as employees know exactly what the company expects, there will be fewer problems.

Guiding Principles

When it comes to addressing the guiding principles behind creating a code of ethics for the company, one must look to the founder, who vowed that the company would be built on honesty and integrity. He also wanted to keep things simple. Keeping customers for a long time was his goal, and it is very hard to keep customers coming back if they feel that a company is not treating them ethically. When a company grows and develops in the proper way, it remains strong and can avoid many of the hardships that would otherwise be seen. It was not possible for the original founder to prepare for the globalization and technology that are seen today and used by his company, but he did have a clear vision of how people should be treated. There is no reason that has to change simply because his company is now able to reach a much larger number of customers and potential customers throughout the world. A code of ethics is a great way to honor the founding principles upon which the company was based, and the actual founder who created that company (Hartley, Grayston, & Ryle, 2010).

Purpose of the Code

The code's purpose is to provide the ethical beliefs and requirements of the company. There are many different ideas when it comes to ethics, and that is true of both people and companies (Hartley, Grayston, & Ryle, 2010). With that in mind, any company that is focused on protecting its employees and its customers should have a code of ethics that is written and that is signed by all employees as a condition of their employment. The main purpose of a written code is clarity, because verbal rules are not as easily enforceable and can be confused (Clark, 2012). Each employee needs his or her own copy of the ethical code, as well, so they have it to refer to any time. If there is no purpose to the code of ethics it will not make sense, because it would not provide proper information for clearly understanding the actual code. Rules are arbitrary if there is no clarity as to why the rule is in place, and when employees feel that rules are arbitrary they are less likely to consider following them.

Core Values

Integrity and honesty are the main core values carried by the XYZ Doodad Company. These principles guide the entire operation, and it has been that way since the company was founded. When the founder first started the company, he knew that being honest and having integrity would carry him and the company a very long way -- but those virtues and values had to be maintained throughout the entire time the company was in existence. One of the ways that could be done was through the creation of a code of ethics, which would endure the changes that would take place in the company and in society over time. The company is actually offering a great deal to its customers. Consider their core values:

Honesty: Being honest is very important for a company that wants to be successful. Employees are not interested in working with a company they feel is going to lie to them (Clark, 2012). Additionally, customers want honest companies to make purchases from. To protect itself and the people it does business with, XYZ Doodad Company will require honesty of all employees in its code of ethics when dealing with vendors, other employees, customers, and potential customers.

Integrity: People can trust companies that have integrity (Clark, 2012). All employees of the company are expected to act with high levels of integrity. That will keep customers and vendors interested in doing business with the company. When an employee tells a customer or vendor something, that customer or vendor will know they can trust the information that has been provided to them by that employee.

Training and Education

In order to make sure all employees follow the code of ethics that a company has created, it is important to make sure they are educated and trained in the right way (Davidson & Stevens, 2013). It is not a fair or realistic way of handling things when a company expects employees to follow rules and regulations they have not been trained to handle or even understand. While some ethical issues are very simple, others are more complex and require training for the employee. At XYZ Doodad Company, both education and training are considered to be highly important. Every person hired is carefully vetted, and the company wants to know new employees are going to be trainable and ready to learn. There is a comprehensive program for training at all company levels, so each person starts his or her experience with the company with the tools needed to succeed.

Definitions

There are definitions that are important to the scope of a code of ethics, including:

Employees: These are people hired to work for the company in any capacity and who receive a W-2 for their wages. It does not include independent contractors (1099 workers), or volunteers.

Ethics: This is the moral code required of all employees. They have to abide by it while they are on the clock in any and all interactions they have with others.

Customers: These are people or companies who do business with the company through purchase of its products. Former and potential customers are also included in this definition.

Vendors: These are companies and people that sell services or supplies to the company.

Covered Employees

To be considered a covered employee, a person must receive a W-2 for tax purposes and be paid on a set schedule in an active employment relationship. To this end, all official employees of the company are covered employees. Any person working with the company in any capacity should ask questions if he or she is not sure of his or her responsibilities or role when it comes to the code of ethics.

Implementation and Communication

There will be two ways in which the code of ethics will be implemented. First, there will be a copy of it available in any open areas of the company that the employees share, such as the break room. This will ensure that all employees have access to it at any reasonable time. The Human Resources Office will also have an available copy of it, and the employees can refer to it there and/or talk to HR about any concerns they have with the code. A computer file and a hard copy of the code of ethics will be provided to each and every employee on his or her first day with the company. The employee will be required to read the code of ethics and sign the signature sheet, which will have to be returned on the second working day.

The code will be kept by the employee, and he or she cannot provide an electronic signature. At the time of signing, the signature sheet will also include the employee's position, the time and date, and the version of the code being used by the company. When new versions come out, new signatures will be required. While this can take time and effort, it will ensure that no employee can claim he or she did not receive the newest version of the ethical code or did not know about the changes.

The code and any issues surrounding it must be properly communicated to the employees, which should not prove difficult. A check of the personnel files will show what each employee has signed, and anything that is not found to be current can be updated at that time. If an employee does not have the most recent signature sheet in his or her file, he or she will be asked to update his or her information, and whether this has been done in a timely manner will be subject to follow-up by the HR department. New employees who come into the company will be signing the most recent version of the code of ethics, keeping everyone up-to-date where company ethics are concerned. That is among the best ways to be sure each employee is aware of his or her responsibilities, and that all employees understand everything located within the ethical code of the company. If the code changes, this will be communicated to the employees in writing and acknowledgment will be required.