How to Create an Ethical Culture

How to Create an Ethical Culture

Ethics is an ever-changing perspective and must be reviewed periodically to ensure it is up-to-current. Old, outdated, ambiguous, and ill-conceived policies and practices will signal to employees and others that ethical behavior isn’t a primary concern of management.

1.     Establish an Ethical Code of Conduct

Every organization needs a written code of conduct that reflects its ethics and values. But it can’t just be on paper. Management must take that code to heart. Like any aspect of company culture, expectations regarding ethical behavior need to be communicated, understood, supported, and demonstrated from the top down in a consistent and continuous manner, year in and year out. This applies to all natural resource specialists as well, especially foresters and wildlife managers who have dual roles of dealing with forests and people. The days of working independently in the woods and relying principally on technical and operational skills are over and are unlikely to return.

Professional codes of ethics play a key role in guiding these activities and in influencing decisions. Those of you who are Certified Foresters and Registered Foresters are aware that ethics is being emphasized in many of the programs required for recertification, as it is in many professions.

2.     Identify and Communicate Specific Examples of Ethical and Unethical Conduct

A traditional process for determining ethical conduct follows four primary perspectives on how to view and evaluate ethical decisions. These perspectives guide the decision process through a series of questions:

  • Is the decision legal?
  • Does the decision respect the rights of the individuals affected?
  • Is it fair and equitable?

3.     Promote Ethical Decision-Making through a published Employee Code of Conduct

Develop policies and practices that will reduce or even eliminate most problems. At least when those policies and practices are created and publicized, employees who practice unethical behavior will do it deliberately and not out of misunderstanding and can be treated accordingly.

Key elements of an Employee Code of Conduct include:

  • The rights of the employee and the organization.
  • The responsibility of all employees to work within the law is to be respectful and responsible.
  • The responsibility of all employees to report conflicts of interest, fraud, and health and safety concerns.
  • Infringement information gives specific examples of company policy on handling typical ethical situations faced each day in the workplace.
  • Employee agreements.

To maximize its effectiveness, an organization should ensure its Code includes the following best practices:

  • A message from top management.
  • An explanation of why the company has a Code of Conduct, who must follow it, and what happens if they don’t.
  • Accessibility includes prominent visibility, readability, messages in their own language, and attractive, well-organized communications.
  • Accessibility to more detailed policies about complex situations.
  • Company-specific examples that are relevant to employee experiences and changing to address new issues that face employees each day (including FAQ and avenues for asking questions).

4.     Make your Employees your Biggest Allies

You can’t be in all places at the same time. Fraud perpetrators count on that. They learn the systems and processes and even the habits that are in place and use that knowledge to work around them. They also count on other employees either to go along with them as accomplices or to choose to avoid getting involved. Not turning in a colleague (“tattling”) can be a more powerful incentive than the theft itself.

Here are some suggestions about how to do that:

  • To avoid the “tattling” mentality, help employees know when it is important to make the tough choice to tell. That takes more than a brief overview of the policies.
  • Conduct Anti-fraud training programs once a year. Review the ethics policy as well as other ethical issues directly related to the company’s business and culture. Teach employees how to recognize fraud and what to do when they see something.
  • Have methods available to allow employees to easily report fraud anonymously and easily. This overcomes the fear of repercussion or involvement.
  • Include Senior Managers as well as all supervisors in the training. Sr. Executives aren’t immune to fraud and in fact are able to steal higher amounts from the company per incident. Dishonest managers at all levels set a tone that will likely lead others to follow. Finally, Managers should be able to spot Red Flags and be encouraged to act.

5.     Establish Internal Controls

Through well-structured, well-communicated, and sound accounting and other process practices and procedures, companies can make a big difference in preventing and detecting internal fraud. Employees who know what they should be doing and are diligent in following procedures will automatically establish an anti-theft system that monitors ethical conduct. It becomes “the way we do things around here.”