Ethical Best Practices Show

7/31/2019 Ethical Best Practices Show

1/35

Rakesh Sud ACA Grad CWADirector- Acharya Center for

Management Consultancy

[email protected] 9535159757
mailto:[email protected]:[email protected]


2/35

Similar

Words

moral,

upright,

honest,

Righteousvirtuous,


3/35

Ethics has to do

with Morality

Moral principles that

govern a person's or

group's behavior.

The moral correctness of

specified conduct.


4/35

Value statements

Codes of conduct

Executive modeling

Training and communication

Systems that embody values

Mechanisms to discuss difficult cases

Hotlines and helplines

Audit, enforcement, and discipline

Governance of ethics and values


5/35

Ethical

behaviour

Unethicalbehaviour


6/35


7/35


8/35

Ideally, values statements need to grow outof the experience of the company.

An organization cant just have single words.

It needs to have concepts to go with them.Its not just words, but values in actionheres what we owe to this constituencycaptured in phrases and sentences


9/35

Ethics code should not be an incrediblyaspirational document

If we rolled this out, the snicker factor wouldbe so high. People would be laughingbecause the difference between our currentpractice and what this says is so great.

The worst values could beto reach beyond the minimal.


10/35

The ideal code of conduct is organized,comprehensive, and applies to all employees.

While a typical values statement runs about apage, a code of conduct is usually a booklet

that includes a background on policies, givesdetails needed to apply the policies todifferent departments, and includesinstructive Q & As.

If youre able to help interpret the code,youre able to help explicate and answerquestions, he said.


11/35

It is wrong if its written in legalese orcaptures last years trivia.

Even a well-written code is useless if itsmerely a document that sits on the shelf orhas unclear application


12/35

What the CEO and the management team dodwarfs everything else when it comes tocorporate ethics and values.

They are a walking embodiment of values,day and night, in public and in private.


13/35

They need to not only walk the walk, and also talk the talk.

The CEO tells stories about putting values towork. Theyll be sharing stories about how Ifaced last week. Or Heres a problem ourhead of Asian operations faced, and hereshow it was resolved


14/35

This can go wrong if an executives privatebehaviour is inconsistent with the values or ifhe pleasures himself with corporate funds

Another potential stumbling block can be ifthe executives never mention values or showdisdain for their employees.


15/35

Best practices include constantcommunication about values, not only fornew hires, but also on a regular basis with allemployees, including regular and engaging

training.

Training can come up short if its obviousthat trainers and executives are only payinglip service to the values, or make snickeringreferences to them.

.


16/35

One threat to effective communication is thereductionist approach.

Not in person, theyll say, it takes toomuch time. So lets do it online, but maybe

we dont want to take two hours to do itonline each year.

Maybe we can give them a five-minute testand only if they flunked the test do they have

to do our two-hour training. Such shortcuts can undermine an otherwise

seemingly effective program.


17/35

Creating systems that embody valuesrequires having a performance evaluationsystem that has explicit references to values,having values integrated into operating

systems, and examining key decisions in lightof values.


18/35

If the systems are ignored or if performancepressure or financial criteria trump values,the ethics get lost.


19/35

Transparency needs to exist regarding toughcases, he stressed. Employees need to beconfident that they can take a tough case tothe boss, even if the cost is high and they

dont know what to do. Mechanisms, such as a corporate committee,

need to be in place to vet cases.


20/35

Most importantly, employees need to beconfident that they will not be penalized forimplementing values.

Those mechanisms are worthless, though, iftheres a dont ask culture or anunwillingness of executives to share theburden.


21/35

In the best cases, hotlines and helplines haveexternal and credible reporting. Anonymity isavailable with no possibility of retribution.And calls are followed-up effectively.

If those are lacking, if employees dontunderstand the purpose of the hotlines, or ifthe people who answer the phones lackempathy, a hotline goes cold quickly.


22/35


23/35

Conversely, companies can run into problemsif compliance is the whole of the valuesmessage, if compliance and discipline areeasier on executives than on front-line staff,

and if the compliance system merely protectsthe company.


24/35

Best practices involve having a seniorexecutive overseeing the ethics effort, havinga dedicated ethics officer, and having anactive audit or ethics committee, with

periodic reporting to the board.


25/35

However, if ethics is assigned to a lower-levelexecutive, if the ethics officer is notrespected, if the audit committee isuninterested, or if reporting is merely

perfunctory, the governance will beineffective.


26/35

Ideally, revised values and standards shouldbe rolled out periodically, about every threeyears.

There should be a freshness of the messagefor each renewal and an engagement of theorganization in the fresh message.


27/35

One of the things that I think is powerfulabout the J&J model is what they call theircredo challenge meetings, where one-thirdof the senior staff comes to a meeting each

year and talks about whats happening in theworld of credo issues that were not dealt withwell or are not covered by the current policiesand values statements.

They build those up over three years and thenthey use that as input to the rewrite, he said.


28/35

A renewal can be unsuccessful, though, if themessage remains stale and unchanged, iftheres no effort to seek input from theorganization, or if recent incidents are either

ignored or overemphasized.


29/35

Developing best practices in creating ethicalcultures is, of course, an on-going process.

Theres this whole issue of individualempowerment and how we build in our senior

people the sense of ethical backbone, ethicalcourage, personal responsibility andaccountability, that should be included.


30/35

We need to tweak the taxonomy to somehowaddress the issue of getting bad news to thetop, getting people to recognize the ethics inwhat they dont immediately think of as an

ethics issue, and to somehow build into bestpractices the collegial, collaborative process.


31/35

Disconnecting sales and service calls toreduce the average time per call

Adding unordered items to customerrequests to increase the average dollars per

sale

Deleting customers from the market researchsample when they have been the subject ofthe preceding behaviours.


32/35

Vision statement.

Values statement.

Organizational code of ethics

Ethics officer

Ethics committee. Ethics communication strategy

Ethics training

Ethics help line

Measurements and rewards

Monitoring and tracking systems

Periodic Evaluation

Ethical Leadership


33/35

Ethics in anorganisation must be

described in referenceto the pressure-to-perform scenario.


34/35

Insuring that ethical actionremains a vibrant aspect of

an organization's climateand culture is an ongoingchallenge


35/35

Industry can't survive if we allow the lowestcommon denominator. We need to maintainintegrity and excellence in what we do.

Ethical best practices should establish arelationship of transparency and trustbetween employer and employee, creating amore open, honest relationship.

Ethical Best Practices Show

Documents

Transcript of Ethical Best Practices Show