ADVANCING ETHICAL CULTURE AND BUSINESS PRACTICESIN INDUSTRY AND GOVERNMENT

Top 10 Ways To Demonstrate Your Company's Commitment To Ethics

1. Strong Ethical Leadership

This requires more than just “tone at the top”. The entire organization takes its cues from the leadership from the Board Room to the Mail Room, and that message needs to constantly emphasize integrity above all other objectives. Adequate resources and independent placement of the company's Ethics and Compliance Officer is a good place to start.

 

2. Promoting an Ethical Culture

Ethical culture is often defined as the “way things are really done around here.” Do you know what your employees really think about integrity in your organization? Regular ethics surveys are a good tool to test the waters. A company's ethical culture can be strengthened (or weakened) by priorities expressed in its employee and manager performance appraisals, subcontractor terms of reference, and executive compensation decisions.

 

3. A Useful Code Of Conduct

Is your company's Code of Conduct a useful reference guide that employees can refer to when faced with ethical dilemmas? Does it outline the employee's duty to report violations, and provide current points of contact to obtain guidance? A well-written code sets expectations, lays out accountability, and is a living document that helps drive good ethical decisionmaking.

 

4. Effective Ethics AND Compliance Training

An effective Ethics training and education program consists of both live and computer-based methods, covering BOTH regulatory compliance matters and the most common ethical dilemmas and highest risks your employees might face. New hires, senior leadership, and even Board members could benefit from the right kind of training, ensuring that everyone in the organization understands their role in maintaining the company's integrity and reputation.

 

5. Appropriate Rewards and Sanctions

Clearly communicating the sanctions that will be applied for violating a company's code of conduct is a critical part of an effective ethics and compliance program. But that's the easy part. Has your organization developed a way to reward or incentivize good ethical decisionmaking? Does your company publicize both good and bad cases as teaching tools, and evidence of the company's commitment and resolve? “Best Practice” companies have employed innovative approaches to rewarding good ethical behavior that may help your organization.

 

6. Robust Anonymous Reporting and Helpline

Does your company have a true, anonymous reporting “hotline” that employees use and trust? A Hotline is a critical tool, and not just for reporting wrongdoing—employees need to feel that their comments and suggestions matter. They also need a place to ask questions and seek guidance before a potentially unethical decision is made. 'Best Practice” companies use hotline data and analyze trends to better focus their ethics and compliance communication and education efforts.

 

7. A Documented Corporate Investigations Process

Despite the best planned and executed Ethics and Compliance programs, it is inevitable that ALL companies will experience employee wrongdoing sooner or later. When that time comes, does your company have well-documented procedures to investigate allegations? Will those procedures withstand external scrutiny? Companies need to ensure that their investigative processes are sound, uniformly applied, and implemented by well-trained professionals.

 

8. Effective and Tested Internal Controls

A company's due diligence will be measured, in part, by the steps it took to prevent fraud and misconduct from happening in the first place. “Best Practice” companies periodically audit and review their business practices and internal controls to ensure that they have addressed the most likely vulnerabilities. They also analyze ethical breaches to identify and fix control lapses that contributed to the problem.

 

9. Transparency and Cooperation

While it may be unrealistic to believe that wrongdoing will never happen, what a company does AFTER a problem is discovered might very well determine the severity of its impact. New requirements for mandatory disclosure of wrongdoing, and revisions to Chapter 8 of the Federal Sentencing Guidelines, describe in detail what the government expects of its contractors, and how transparency and cooperation can help mitigate a bad situation.

 

10. Independent Assessments of Your Ethics and Compliance Program

You may think you have a robust program, but how does it compare to industry best practices, and will it hold up to external scrutiny when a crisis occurs? Will your organization be able to take advantage of opportunities contained in suspension and debarment procedures, US Attorney's manuals, and federal sentencing guidelines that give credit for effective ethics and compliance programs? Arranging for a professional, independent assessment of a company's ethics and compliance activities can help demonstrate an organization's commitment to ethics and integrity when it matters most.