ORGANIZATIONAL BEHAVIOR - How to Create a Code of Ethics for a Business

How to Create a Code of Ethics for a Business

by Bonnie Conrad, Demand Media

These days, every business should have a written code of ethics. The code of ethics you create communicates the company's philosophy to employees, vendors, customers, clients and the public. Because of a growing focus on business ethics over the last decade, according to Ethics Web, many customers now actively seek out firms that promise to do business in an honest and ethical manner. As a business owner, writing a code of ethics is one of your most crucial jobs.

Step 1

Review sample codes of ethics that companies in a similar business use. Read those documents carefully, and look for information you can apply to your business.

Step 2

Review other documents related to your business, including the firm's mission statement and any specific policies new hires receive as part of their orientation. These documents can include the Internet and phone usage and time-off policies. Review documents that address the conduct standards your firm has established. Use those documents as a guide when you create your formal code of ethics.

Step 3

Think about the ethical dilemmas that face not only your company, but also its competitors. These ethical issues vary by industry, and it is important to directly address them in the company's code of ethics. For example, a clothing manufacturer could pledge not cut off ties with vendors who use child labor.

Step 4

Solicit input from employees when you create the code of ethics. Many companies make the mistake of leaving workers out of the loop, but the front-line workers confront ethical dilemmas frequently. Ask employees for specific examples of situations that make them feel uneasy, and incorporate those ideas into the code of ethics.

Step 5

Address potential workplace issues, such as office romances and nepotism, in your code of ethics. If your small business is mainly a family affair, outside employees might feel intimidated when they work with your family members. Make sure the code of ethics directly addresses hiring practices nd the outlets for perceived grievances.

Step 6

Assign an individual in your company to be responsible for compiling the code of ethics. Empower that person with the resources she needs, including the flexibility to communicate openly and frankly with front-line workers and others within the company. Allow her to solicit feedback from both the management team and the workers. Although the chief executive officer, along with the legal team, is ultimately responsible for the content of the code of ethics, assigning a member of the management team to draft the document creates a single point of contact for everyone in the organization.

Step 7

Ask your attorney to review the proposed code of ethics before putting it in force. Ask the attorney for feedback regarding any necessary changes to the document.