Advantages And Limitations Of A Company Code Of Ethics

1. Introduction

Ethics, according to Judeo-Christian ethics, may be defined as the moral philosophy that governs a person´s or a group´s behaviour; it has to do with what is morally wrong and right or good and bad. Ethics exist since the beginning of humanity but also in almost all living creatures, among the majority of which we find the rudiments of moral relations. Practically every human society has some views and fundamentals that governed them and control their actions, from which is derived what is ethically or not. It should be pointed out that what is good for an individual is not necessary same for another individual. One famous character in the ancient who drives ethics origin was Plato while evolution of ethics started with the

Employers and employees will function according to the code of ethics. Similarly to rules in daily life which contribute in helping people to stay more focused on what the right action is for common situations, a company code of ethics accomplishes the same action in those situations where moral judgments may not entirely apply. Ethical behaviour is beneficial for everyone because it protects the interests of the company or organization and the interests of everyone who comes into contact with the organization. However, it does also have some limitations.

2. Benefits of Business Code of ethics

The main concepts of a company code of ethics are Integrity, Honesty, Justice, Competence, Utility, Conflict of Interest among others. Code of ethics are beneficial for an organisation as it creates a positive work environment which makes employees highly motivated and also increase the potential competitive advantage of the organisation which results in happy customers and stakeholders. Some of the main benefits concepts are detailed below.

2.1 Respect and

Limitations of Business Code of ethics

As all documentations have advantages and disadvantages, similarly business code of ethics also has its limitations. It is sometimes difficult to adapt in the business culture. Some of the limitations are described hereafter.

3.1 No commitment

A business code of ethics has its limitations when there is no commitment from the entire organisation. Unfortunately, no one can be force to adhere to the code but they can be educated in this direction. Commonly, staffs do abide to the code of ethics but there is not always the same will from top management. Since the latter does not give the example, this sometimes discourages staff to continue to follow the code of ethics. Consequently this situation may lead to demotivated staff and an improper working environment and even business failure.

3.2 No use of the business code

Another typical example of limitation is that some organisations do have a code of ethics but they are not being use. They may have created the code only for the sake of having it and none of the staff of the company uses it or is aware of it. Top management or staffs are not driven by the code of ethics that exists.

3.3 Ethical