What Is Ethical Behavior? Standards for Workplace Ethics

Workplace ethics are similar to personal moral codes—the main difference is business ethics are generally more explicitly codified. Through training programs and onboarding materials, companies make their ethical standards known to current and incoming employees. These rules and regulations elucidate how companies solve ethical issues as well as the moral expectations they have of their staff.

Clear ethical standards help businesses ensure a stable, functioning, and happy work environment. Here are four reasons to codify your company’s moral standards:

• Ethical behavior standards boost employee morale. While ethical principles regulate employee behavior, they also provide for an overall ethical culture, something necessary to boost morale and a sense of well-being among workers. When people can reliably expect fair, decent, and kind treatment at their jobs, they’re more likely to enjoy showing up and working hard.
• Ethical behavior standards give confidence to stakeholders. Ethical companies shore up the confidence of investors, potential clients, and other influential decision-makers. Business success often rests on a reputation of reliability, something only possible via a longstanding commitment to responsible and ethical behavior.
• Ethical behavior standards hold people accountable. Standards of ethical conduct level the playing field between business leaders, managers, and employees. They establish the expectation companies will reward ethical behavior and punish unethical actions no matter the status of the person who engages in either. As such, a code of conduct acts as a leveler of hierarchies because the same standards apply regardless of whether you’re the CEO or a recent hire.
• Ethical behavior standards provide guidance. While some moral standards are self-evident, other ethical dilemmas can feel murkier. When you provide your staff with a clear guide to your company’s ethical expectations, they can more easily resolve these sorts of quandaries.

Establishing your own company code of conduct can be a complex but necessary task. Here are seven elements to include to ensure fair, equitable, and ethical business practices:

1. 1. Clear consequences and rewards: Ethical decision-making should be uncomplicated for your employees. For instance, state explicitly how your company will reward ethical traits like truthfulness and punish unethical behavior like dishonesty. The clearer you are about these rewards and consequences, the more incentives you give your employees to act in accordance with your standards.
2. 2. Confidentiality expectations: Businesses must clearly outline what information needs to stay within the company. For example, there are trade secrets that should stay private on an organizational level as well as individual employee privacy standards to upkeep. Keep everyone in the loop about what must remain private and how to respect individual people’s boundaries, too.
3. 3. Diversity, equity, and inclusion codes: Businesses have a social responsibility to enshrine a set of values encouraging diversity, equity, and inclusion (DEI). This means ensuring fair hiring practices as well as having guardrails in check to penalize anyone who treats someone unfairly or unkindly because of their identity.
4. 4. Outline of individual responsibilities: Efficient business operations hinge around everyone knowing what’s required of them. Each employee must understand their individual responsibilities so they can see how your company’s ethical principles bear on their unique position. It could be helpful to provide examples of ethical behavior as well as what you consider to be unethical actions for each job type in your company.
5. 5. Sexual harassment policies: To ensure an ethical workplace, make it clear that your company will not tolerate sexual harassment of any kind. Everyone from the business owners to the managers and employees must be mindful and respectful of personal boundaries.
6. 6. Whistleblower processes: Employees need a way to safely report unethical conduct without fear of reprisal. Set up a whistleblower channel, perhaps through a neutral third party, so every person at your company feels they have the ability to stand up for the moral principles of your business and their own personal ethical standards.
7. 7. Zero tolerance for conflicts of interest: Everyone at your company should know they must not engage in a conflict of interest. For example, if you are privy to your company’s financial state, it would not be an ethical business practice to encourage family members to sell or buy shares of stock in it on the basis of that information.

Get the MasterClass Annual Membership for exclusive access to video lessons taught by business luminaries, including Howard Schultz, Chris Voss, Robin Roberts, Sara Blakely, Daniel Pink, Bob Iger, Anna Wintour, and more.