Article Analysis: How Ethics Can Be Made To Work

747 words - 3 pages

The article, "How ethics can be made to work" written by Allison Maitland, on Ft.com on March 2005 is about what can be done to make ethics work in any business world wide? Ethics like once used to be a voluntary tool but now has become an obligation, a must have for every business world wide. As per the article, "New York Stock Exchange listing rules require companies to have a publicly displayed code of business conduct and ethics...In the UK, it has been best practice since the 1992 Cadbury report on corporate governance for boards to draw up and publicize a code of ethics or statement of business principles...But the mere existence of a code is not enough." In the article Simon Webley, research director at the Institute of Business Ethics, a UK charity that promotes high standards of corporate behavior, says that many times companies establish too many codes and suffer "code exhaustion." Most of the time a code is drawn up, send it out to staff members and then forgotten. A report published by the institute last month shows that half of the top UK companies with codes do not train all their staff in what the ethics code mean and how to use them. Further he goes on to say that placing the code of ethics becomes useless for any business with no training on how to deal with the ethical situation when arises makes no business sense. (Maitland, 05)"Judgment about the effectiveness of a code depends on what its primary purpose is. In the US, having a code can give legal protection: the federal sentencing guidelines allow for reductions in penalties for corporate crimes if companies already have programs to detect and prevent misconduct. Elsewhere, reasons for having codes include protecting reputation, reinforcing an ethical culture and supporting staff that blow the whistle." (Maitland, 05)The article further goes to explain the human nature as a complicating factor. Research was conducted by Mark Schwartz, assistant professor of business ethics at Toronto's York University, asked 57 managers, employees and ethics officers at four large Canadian companies what it was about their codes and the way they were implemented that made them effective or ineffective. (Maitland, 05)When Mr. Schwartz asked whether all four companies' codes required staff to report violations? The answer he received was, "That depended on...

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