Above all else, corporate culture shapes the ethical behavior of everyone in a business organization. Corporate culture starts with the company's mission statement, which should clearly outline the company's priorities, goals and guiding values. A company handbook builds upon the basic precepts of the mission statement in an easily distributed form, designed for quick consultation by middle management and front-line supervisors.
Forming a Company Code of Ethics
A mission statement makes a good starting point when plotting out a business code of ethics. In the case of a sole proprietorship, the business owner can make the code of ethics her own, based upon deeply held personal moral principles. While it may be attractive to write a corporate code of ethics based upon the "anything to win" mindset, it is critical that a business' ethical policy supports the letter and intent of local law. A failure to respect local laws in the interest of pure profit often finds white-collar workers and managers before a court of law. Beyond simply obeying the law, a code of ethics defines values related to maintaining a positive relationship with the local community, through local investments in the public good.
Ethical Environment in Top-Down Leadership Structures
Leadership shapes workplace ethics by clearly defining who is in charge of ethical policy enforcement. Companies with traditional top-down command structures tend to put front-line supervisors in charge of dealing with minor infractions, while severe ethical breaches are referred to higher levels of management or general human resources. Some large firms even employ ethics officers tasked to investigate ethical issues full-time.
How Cooperatives Handle Workplace Ethics
In a cooperative where ownership of the business is shared and decisions are made democratically, ethical violations are reported by peers and brought before a committee of peers for investigation. If a member of a cooperative is found in violation of its code of ethics, the cooperative votes on whether to kick the violating member out. If the vote succeeds, the member may be given the cash value of his share of the co-op or forfeit it, depending on the specifics of the membership agreement.
The Importance of Ethical Standard Enforcement
Having a strong written ethical framework in place serves no purpose if those guidelines are not upheld. Consider the position of an employee who reports an incident of workplace harassment, for example. If the complaint is taken seriously, at least warranting a formal warning and an investigation, the complaint will end there in less severe cases. On the other hand, a company that ignores the report only ends up embarrassing the employee who was concerned enough to complain. This might lead to that good employee quitting to get out of the harassment situation. The employee who left after being harassed and ignored might even turn around and sue the company, or the person who harassed her. In the end, enforcing ethical standards helps put out fires as they spring up, before they become unmanageable problems.