What is Organisational Ethics?

Organisational ethics refers to standards of good, right, and fair conduct that prevail in an organisation. These standards determine how an organisation will treat internal and external stakeholders. The ethics of an organisation is influenced more by the prevailing culture in an organisation than by what is written in policy documents. In other words, it is about the informal knowledge of 'how we do things around here'. Organisational integrity is the extent to which the formal policy documents and the actual behaviour are aligned.

What is business ethics?

Business ethics is a form of applied ethics examining ethical problems that arise from the business environment. It addresses all aspects of business conduct and has relevance to the conduct of individuals as well as the entire organisation. It can be seen as a specialist form of organisational ethics that applies specifically to business.

Is there a difference between a code of ethics and a code of conduct?

Not everyone draws a distinction between the two, but it can be useful to do so. A code of ethics is a short, aspirational document outlining an organisation's core ethical values, ideals and principles. A code of conduct on the other hand, is a longer, directional document. It is very specific in describing or forbidding specific behaviour and consequently easier to enforce. Codes of conduct typically lay down procedures and rules regarding acceptable or unacceptable practices related to operational issues. In essence, a code of ethics is a value-based document, while a code of conduct is a rule-based document.

What is an ethics management programme?

An ethics management programme refers to a systematic approach to instilling ethical standards in an organisation. It includes all interventions to create an ethical organisational culture where everyone understands and consistently applies an accepted set of ethical standards.

What is an Ethics Officer?

An Ethics Officer refers to a mid-level or upper-level manager entrusted with managing an organisation's ethics programme.

What are the responsibilities of an Ethics Officer?

Ethics Officers are responsible for implementing the ethics management programme which could include:

  • Compiling an ethics risk profile for the organisation;
  • Drafting an ethics strategy;
  • Developing, maintaining or updating the organisational code of ethics or conduct and other relevant related policies;
  • Conducting ethics training;
  • Managing conflicts of interest;
  • Developing an ethics communications strategy;
  • Providing ethics advice to employees; and 
  • Reporting to management and relevant committees (such as the Social and Ethics Committee) on the ethics performance of the organisation.
What is an ethics risk assessment and why is it important?

An ethics risk assessment (ERA) is the first step in an ethics management programme. It aims to identify unethical behaviours, practices and beliefs in the organisation. An ethics risk assessment is used to produce an ethics risk profile for an organisation.
An ethics risk profile provides a baseline against which the company can measure itself over time and informs the next steps in organisational ethics management, namely the formulation of an ethics strategy, codification of the organisations ethics standards, and the development of ethics-related policies.

What is an organisational ethics indicator (OEI)?

The OEI is a staff survey that assists organisations in gauging the effectiveness of their ethics management interventions as well as the prevailing ethical culture in the organisation. The OEI measures the following aspects of an organisation's ethics:

    Levels of awareness of ethics management interventions;
    Levels of perceived effectiveness of ethics management interventions;
    Organisational climate, including;
    Organisational culture
    Staff satisfaction with the organisation's and leadership's ethics performance
    Observed misconduct, tendency to report, and satisfaction with responses to reporting
    Organisational pressure to compromise ethical standards.

Since an OEI is based on staff perceptions, it is one of the few ways of getting statistically verifiable data on the effectiveness of the ethics programme. It has been conducted in many organisastions, and therefore allows organisations to benchmark the outcomes of their OEIs.

What is a Social and Ethics Committee?

The Social and Ethics Committee (S&EC) is a board committee required by the Companies Act in South Africa. The S&EC has the mandate to (1) monitor the company's activities, having regard to any relevant legislation, other legal requirements or prevailing codes of best practice regarding social and economic development, good corporate citizenship, the environment, health and public safety, consumer relationships and labour and employment. It furthermore has the responsibility to (2) draw matters within its mandate to the attention of the Board as occasion requires, and (3) to report, through one of its members, to the shareholders at the company's annual general meeting on the matter within its mandate. For more information, see the Social and Ethics Committee Handbook.

Which companies must have a Social and Ethics Committee?

Publicly-listed companies, state-owned enterprises, with a public interest score of more than 500 points

How relevant is the King III report on corporate governance to companies?

The King III report provides best-practice principles for corporate governance that are applicable to all types of organisations. It enjoys special relevance to companies listed on the Johannesburg Stock Exchange (JSE) as they are expected to comply with the King III guidelines. It also forms part of the listing requirements for companies that opt to be listed on the JSE.

Does EthicsSA offer some online training courses?

EthicsSA only offers online modules for continuous professional development (CPD for specific professions. These online modules are offered through AOSIS (African Online Scientific Information Systems). Currently there are online modules available for accountants, auditors and financial planners.