How to Develop a Code of Conduct for a Company

By hrlineup | 02.01.2020

Every company needs a well-developed code of conduct for its employees. For public companies, this is a must have but even private businesses needs it as an internal guideline on how employees are expected to conduct themselves. But what is a code of conduct policy? The company code of conduct is a useful statement of the values and commitments the company holds dear. It should be well-written so as to bring out the company’s values, mission and principles, associating them with the standards of professional conduct employees must adhere to. Since it showcases the values that the organization wishes to impart on its leaders, and employees, it defines the desired conduct of everyone working in the company.

Why is an organization’s code of conduct guidelines important?

  • In most cases, organizations formulate a code of conduct as a way to remain compliance. There is the legislation that requires people who are serving on the boards as well as organizational leaders of public corporations to come up with codes, failure to which they are required to give a valid reason.
  • A company code of conduct for employees is also a marketing strategy. It is mainly a public statement that explains what the organization stands for and how committed it is to high standards and the right behavior.
  • A code of conduct is also a strategy to mitigate risks. Those companies that have well-formulated codes of ethics and those that follow the defined guidelines to the letter have a chance to reduce their financial risks that come with government fines for ethical misconduct. This is because such organizations can demonstrate that they have made an effort in good faith to prevent any illegal conduct.

How to make a code of conduct

To make a good code of conduct, an organization needs to first determine the key values and ethics it seeks to abide by. The leading creator of the code of ethics should start by listing down their personal values, and then discuss those values with the rest of the team. The business’ mission statement as well as how the team thinks the company should handle ethical issues should be considered here. You could review the codes of ethics written by other organizations as a guide on how you should develop yours.

Once the code of conduct is formulated, discuss it with the rest of the team and listen to their opinions to make any necessary corrections. Once everything is agreed upon, let everyone sign the document to show that they completely agree with it.

An organizations code of conduct is a very effective tool in guiding employees and company leaders on how the business should conduct itself especially when handling ethical issues. Some codes are quite brief while others are extremely detailed. There is no limitation as to how much an organization can have in the code of conduct. What is important is that the code is providing a clear guideline on how everyone should conduct themselves.