Page 172 - Microsoft Word - 00 P1 IW Prelims.docx

Chapter 13

Corporate code of ethics

Corporate ethics relates to the application of ethical values to business behaviour.

 It encompasses many areas ranging from board strategies to how
companies negotiate with their suppliers.

 It goes beyond legal requirements and is to some extent therefore
discretionary.

 Many companies provide details of their ethical approach in a
corporate and social responsibility (CSR) report.

3.1 Key areas included in a code of corporate ethics

 Purpose and value of business – reason for organisation’s existence

 Customer relations – responsibility to produce quality goods/service at
reasonable prices. To develop customer faith

 Shareholders – expect an appropriate and proper return on investment

 Employees – how the business relates to its employees

 Suppliers – co-operate with suppliers to maintain and improve quality of inputs

 Society – social and corporate responsibility for the society in which the
organisation is located

166