Hiring an ethics officer is the first stage in the process of making ethical behavior sustainable.

The culture of a company influences the moral judgment of employees and stakeholders. Companies that work to create a strong ethical culture motivate everyone to speak and act with honesty and integrity. Companies that portray strong ethics attract customers to their products and services.

Customers are happy and confident in knowing they’re dealing with an honest company. Ethical companies also retain the bulk of their employees for the long-term which reduces costs associated with turnover. Investors have peace of mind when they invest in companies that display good ethics because they feel assured that their funds are protected. Good ethics keep share prices high and protect businesses from takeovers.

Creating an ethical organizational culture:

One of the most noticeable ways that companies can demonstrate their commitment to creating an ethical organizational culture is to ensure that top managers and leaders lead by example. Employees look to the behavior of top management as an example of the type of behavior that the company finds acceptable in the workplace. Actions speak louder than words, so when top executives display ethical behavior, it sends a positive message to employees. Senior leaders need to be mindful of the fact that they’re being watched and be sure to practice what they preach.

Research backs up the notion of leading by example. Stanford psychologist, Al Bandura is known for his research on observational learning. Bandura’s stages of observational learning are:

• Attention
• Retention
• Reproduction
• Motivation

The stages suggest that people pay attention to the behavior of others and retain thoughts about it. Then they reproduce the behavior. After repeated times of having a good experience with behavior, people are motivated to repeat it.

Companies that create and disseminate an official code of ethics send a clear message of the expectations for their employees. A code of ethics or code of conduct clearly outlines the organization’s primary values and ethical rules that they expect everyone to follow. The code should indicate that it applies to attire, attitudes, and behavior. Cultural norms and expectations are also inferred and are easily detected by observing the environment.

While it’s good to have a written record of the code of ethics, means nothing if top management fails to model ethical behavior. Employees are observant. They take note of whether the company is adhering to the ethical principles that it set or whether they are merely paying lip service.

A formal ethics training program sends a strong message about a company’s ethical stance. Seminars, workshops, and other ethical training programs reinforce the organization’s standards of conduct and clarify the types of behaviors that the company deems permissible or out of bounds. Situational examples help to address how to handle possible ethical dilemmas. Workshops can help employees to work on their problem-solving skills. Trainings may include consultations from peers or mentors.

Corporate culture always begins at the top. Managers should be evaluated on their ethical behavior as part of their annual performance appraisals. Their appraisals should include specific questions about how their decisions measure up against the code of ethics. Top executives should also be evaluated on the means they take to achieve their ethical goals as well as how the means lead to the ends.

Once again, research supports ethical principles. The principle of operant conditioning, by B.F. Skinner, represents that it’s possible to reinforce the behavior you want to see in others. The principle of operant conditioning also shows that companies shouldn’t reinforce behavior they don’t want to see in others.

People who act ethically should be noticeably rewarded for their behavior and those who fail to act and behave ethically should have consequences for unethical behavior. Rather than fire good employees who demonstrate a single ethics violation, the company may choose to provide correct feedback for the behavior along with a short probationary period. Correction should be conducted in the spirit of collaboration and education rather than punishment or chastisement.

This step should encourage companies to offer their employees opportunities for rewards, recognition, and social reinforcements. Rewards and recognition should be thoughtfully considered taking care to deliver it with attention to detail to avoid unintended consequences.

Most employees will want to do the right thing especially if they work for a company that has high moral and ethical standards. It can be difficult for anyone to report unethical behavior that they witness in other people at the company. Shy or introverted employees may find it particularly challenging to report unethical behavior. Almost anyone would feel intimidated if they felt the need to report the unethical behavior of one of their superiors or someone in a senior management position.

There are several ways that companies can assure their employees that they can safely report unethical behavior without fear of losing their jobs or getting some sort of punishment or consequence. An objective third party such as an ethics counselor, ethics officer, ombudsman, or ethics consultant can be helpful in these situations. An ombudsman can get the tools and resources to help with a consultation or investigation of a complaint about ethical behavior.

Using Technology to Support Creating an Ethical Organizational Culture

In the best-case scenario, your company will never have to deal with an infraction of your Code of Ethics policy. Unfortunately, that’s not the reality for many companies. Here’s where it pays to take a modern approach to creating an ethical organizational culture. BoardEffect offers the perfect electronic platform for securely storing your code of conduct policies, reports, investigations, and the outcome of investigative results.  It provides a secure, confidential online space where a team can investigate, communicate, and collaborate about ethical reports that have the potential to harm the company’s reputation. In the event that an incident takes a legal turn, attorneys have quick access to the company’s code and all other documentation regarding the incident. The board administrator has the ability to limit the users who can participate in such discussions.

The best judgment you can use to protect your company is to implement modern governance processes with the help of a BoardEffect board management software solution.

In order to continue enjoying our site, we ask that you confirm your identity as a human. Thank you very much for your cooperation.

_____ is ethical behavior that persists long after the latest public scandal or the latest management buzzword.

A company's commitment to ethical behavior affects:

every managerial level and every department of the organization equally and increases its efficiency.

Which of the following statements is true of sustainable ethics?

An organization's commitment to ethical behavior must be documented in a code of ethics for everyone to begin from the same starting point.

Which of the following is the first stage in making ethical behavior sustainable for a company?

Establishing a code of ethics

HP Chase Inc., an investment banking firm, has decided to make ethical behavior sustainable in its organization. It has set up the process of monitoring ethical behavior by establishing a code of ethics. Which of the following stages is HP Chase Inc. most

Support the code of ethics with extensive training for every member of the organization

Altra Partners (AP) believes in maintaining sustainable ethics. It has recently established a code of ethics and organized comprehensive training sessions for all its members. Which of the following steps is most likely to be undertaken next by AP?

Which of the following steps is the immediate next stage in making ethical behavior sustainable for a company after it hires an ethics officer?

Celebrating and rewarding the ethical behavior demonstrated by its employees

Downerz Enterprises (DE) has been in the news for fraud by one its directors. As a result, the trustees of DE have appointed a new director who has established a strict code of ethics. He has announced extensive training for every member of the organizati

Celebrate and reward the ethical behavior demonstrated by its employees.

Which of the following is most likely to be the next stage in making ethical behavior sustainable for an organization after it promotes its commitment to ethical behavior?

Continuously monitoring the ethical behavior of its employees as the company grows

Walter Warburg & Co., a new investment banking firm, has dismissed the idea of establishing a code of ethics for its employees. Which of the following consequences is most likely to take place as a result of this decision?

It cannot document punishments for the violation of ethical policies.

A well-written code of ethics:

states policies for behavior in specific situations.

Which of the following elements is most likely be included by an organization in its code of ethics?

The policies for behavior in specific situations

The audience for the code of ethics of an organization should include the:

investors of the organization.

Which of the following statements is true of the code of ethics of an organization?

The code of ethics does not have a perfect model.

Which of the following statements is most likely to be true of an organization's code of ethics?

The code of ethics is written for the employees of an organization, and the stakeholders are not required to follow it.

Which of the following statements is advice from the Institute of Business Ethics for creating a code of ethics from scratch?

Get an endorsement from the chairperson and the board.

In the context of the creation of a code of ethics, the Institute of Business Ethics advises companies:

to introduce practical examples of the code in all company internal (and external) training programs and induction courses.

Arthur and Nicole are arguing over the creation of a code of ethics for an organization. Arthur believes that it would be good for organizations to follow the advice from the Institute of Business Ethics before creating the code of ethics, while Nicole di

The organization would determine the topics on which employees require guidance.

Edmund has been recently appointed as executive in-charge of the code of conduct for Elmer Enterprises. He administers the code of conduct among the organization's employees and oversees the investigations of wrongdoings in the organization. He also provi

The _____ of an organization is the senior executive responsible for monitoring its moral standards both internally and externally.

Derek oversees the investigation of wrongdoings in his organization and provides additional guidance and support to the employees. He also develops training programs for every department to maintain organizational conduct. Which of the following positions

Which of the following statements is true of ethics officers?

They monitor the ethical performance of the organization both internally and externally.

According to the documentation of a survey conducted by the Ethics and Compliance Officers Association, which of the following responsibilities ranks highest among the chief responsibilities of an ethics officer?

Overlooking hotline/guideline/internal reporting

According to the documentation of a survey conducted by the Ethics and Compliance Officers Association survey, which of the following responsibilities ranks lowest in the category of the main responsibilities of an ethics officer?

Conducting investigations of wrongdoing

Which of the following statements is a piece of advice from the Institute of Business Ethics for creating a code of ethics?

The code should be publicly shared on platforms associated with the company.

Which of the following factors is likely to make companies revise and rewrite their codes of ethics from time to time?

A continuous change in the technology used by the company

In the context of a company's ethics policy, which of the following actions should an organization avoid taking?

Communicating only to internal stakeholders

Which of the following risks is most likely to occur as a result of organizational transparency?

Loss of market advantage through corporate espionage

Brenner Inc. (BI) is formulating its ethics policy with the goal of increasing employee loyalty and improving customer satisfaction. In order to meet these goals, BI should ensure that its policy:

includes threats of punishments balanced with rewards.

Which of the following statements is true of transparency?

It provides avenues to increase organizational efficiency.

_____ in business means that stakeholders have visibility deep into the processes and information of an organization.

Bretton Inc. (BI), a multinational corporation, releases detailed financial statements at the end of every quarter of a year. It is open and honest with its clients in all communication and clearly states the terms and conditions of its contracts. In this

A policy that results when an organization is driven by events and/or a fear of future events is known as a _____.

A policy that results when a company develops a clear sense of what it stands for as an ethical organization is known as a _____.

The difference between reactive and proactive policies of an organization is that:

reactive policies are driven by events and/or a fear of future events, whereas proactive policies are driven by a clear sense of what is construed as ethical for the organization.

Which of the following actions is most likely to lead to the promotion of an organization's commitment to ethical behavior?

Allowing employees to visit client sites to talk about the organization's code of ethics

_____ describes the characteristic of publicly committing to the highest level of professional standards and then sticking to that commitment.

Some of the employees, including the top managers and the board of directors, of Warburges Inc. have been in the news lately for accepting bribes and using corporate resources for personal expenses. Which of the following characteristics did the firm fail