Of all the questions board members, executives and managers face, one could argue that unethical business activities, one of the most important in terms of their potential negative impact and also one of the most difficult to address on right. This article argues that three essential elements must be present when illegal or unethical activities within and on behalf of organizations is to be minimized by developing and maintaining an ethical corporate culture. The three elements include (1) the existential … Read more »

Of all the questions board members, executives and managers face, one could argue that unethical business activities, one of the most important in terms of their potential negative impact and also one of the most difficult to address on right. This article argues that three essential elements must be present when illegal or unethical activities within and on behalf of organizations is to be minimized by developing and maintaining an ethical corporate culture. The three elements include (1) the existence of a set of ethical values ​​throughout the organization in its policies, processes and practices infused, (2) the establishment of a formal ethics program, including a code of ethics, ethics training, an ethics hotline and an ethics officer, and (3) the continued presence of ethical leadership, that is an appropriate “tone at the top”, as reflected by the board of directors, executives and managers. While each of these three elements, they differ also overlap to relate and mutually reinforcing. This article describes each of the three elements necessary for developing and maintaining an ethical corporate culture.
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Mark S Schwartz
Source: Business Horizons
12 pages.
Release Date: 15, January 2013. Prod #: BH506-PDF-ENG
Developing and maintaining an ethical corporate culture: The core elements HBR case solution