Why You Need a Code of Ethics

While idealistic, officers may assume that their employees are good people and don’t need a code to behave properly. It is such an assumption that can have disastrous results. Codes of ethics not only encourage upstanding behavior, but delve into gray areas such as keeping accurate records, addressing media inquiries or selecting a vendor or contractor. By outlining expected behaviors and the resources employees have available to them, you can help ward off costly legal and financial ramifications.

If you do not currently have a code of ethics, consider adopting one. The process of developing one doesn’t need to be complex, but it should include all major stakeholders.

A few things to consider:

• Be sure that your code of ethics covers all departments and the potential ethical situations they may encounter.

• Speak clearly and casually; don’t tell your employees what they cannot do, but explain how they should approach different issues.

• Give your employees the tools they need to follow the code. Include information on HR contacts, reporting hotlines or additional company procedure documents they may want to review.

• Support the code from the top down. Don’t just sign off on your code, but be an example of it.

Resource: “Suggested Guidelines for Writing a Code of Ethics/Conduct,” Deloitte, 2009.

Petty Theft in the Workplace

It seems small at first: a few reams of paper, a box of office supplies or 30 color copies of a child’s Social Studies project. Yet it adds up fast. The typical organization loses five percent of its annual revenue to petty theft by employees, according to a 2010 study by the Association of Certified Fraud Examiners. Such theft, also known as occupational fraud, can seriously damage your organization’s bottom line.

The median loss caused by occupational fraud was $160,000, with nearly one-quarter of the frauds involving losses of at least $1 million, according to the same study. In many cases, the theft continued for an average of 18 months before even being detected.

How can your organization curb the activities of sticky-fingered employees?

• Educate your workers. Show them how theft in the workplace can have serious repercussions on the company’s finances, and even result in layoffs down the line.
  
• Randomly check deliveries, both to your business and to your customers.
  
• Change locks and computer passwords periodically.
  
• Create an atmosphere of cooperation against crime. Overly rigid controls and rules can create an oppressive work environment. Instead, encourage workers to help reduce theft as a way to help keep the company healthy.
  
• Consider an anonymous tip program that will allow workers to report incidents of theft without fear of repercussion from the perpetrator.
  
• Clearly communicate the consequences of occupational fraud. Petty theft is punishable by law. Make it known that you will prosecute if necessary. It will be a strong deterrent to others who may be thinking of stealing.   
  

In the end, one of the best ways to combat petty theft is to encourage a sense of ownership in the company. Let it be known that bonuses and commissions are tied to the organization’s bottom line. That makes that pack of staples or sticky notes a lot less tempting.

Ethical Integrity Necessary for Those in Leadership

If you see the top floor corner office as the destination in your career path, there’s more you need in your arsenal than business savvy and acumen. According to a 2010 study by Robert Half Management Resources Survey, the most important attribute in a leader is integrity.

The study surveyed a number of CFOs, with more than 33 percent choosing integrity as their top must-have. Communication skills came in second, something necessary when preventing and managing difficult situations such as workplace safety, theft and compliance.

"History has shown time and time again the importance of ethics in business -- even a single lapse in judgment by one employee can significantly affect a company's reputation and its bottom line," said Paul McDonald, senior executive director of Robert Half Management Resources. "Leaders who are principled and forthright inspire this same behavior in their teams, creating a culture in which integrity is a core value."

The findings are not surprising in a world racked with fraud investigations and trials. Companies want to groom and promote people who will not only protect their financial interests, but influence others to do the same. When upper management sets the example, you can strengthen more than just the bottom line: you can strengthen the brand.

Misuse of Company Property Can be Costly  

Businesses today spend a lot of money on computer hardware and software for their employees.  Computer  “refreshes” every couple of years have become the norm, and workers are enjoying access to faster, better machines and increasingly sophisticated types of software. That’s why it’s so important to make sure this expensive company property is used in the way it was intended.

Here are three of the major issues your organization needs to be aware of:

Software piracy   
The boundary between work and personal use of computers has increasingly blurred as employees check work email at home, or “borrow” a company laptop ostensibly to toil on a project over the weekend. They may covet a software program they have at work and see no problem with borrowing the installation CD. Or they might assume they are saving the company money by pirating a program that will help them do their jobs better.  

Regardless of the reason for duplicating licensed software, it is legally wrong. And it is the employer, not the individual pirate, who will be held liable should it be discovered during a software audit. Companies should establish a strong company-wide anti-piracy stance and communicate it clearly to employees.

Sabotage and unauthorized access to data
Disgruntled employees are learning the power they have to disable a company’s computer systems at will  For example, one worldwide corporation’s email system crashed for six hours after an employee intentionally sent 60,000 coworkers a personal email message complete with a request for an electronic receipt. 

Workers with a bone to pick with their boss may intentionally sabotage important records or files, deleting key information or replacing it with erroneous data. Employees can also misuse and abuse Internet systems to the point that they trigger costly litigation to their employers.   

A great deal of proprietary information and confidential data is stored on computer systems today.  Employees can tap into company databases to look up information on customers and clients that they can then use for their own purposes. 

Companies can combat these problems by limiting access to certain servers, folders and files on their intranets. Only give authorization and access to the most trusted employees. They can also implement electronic tracking methods which will reveal who has been trying to tap into into files or databases they are not permitted to access.  

Using company computers to create materials for their own private or business use
At the workplace, employees often have access to cutting-edge software programs and top-of-the-line printers that they may not be able to afford at home. It’s no wonder they may be tempted to use these company resources to conduct their own affairs on the company’s time — and dime. Signs to watch out for include employees who often volunteer to “work late” but don’t seem to get much done, and those who seem to be printing far more volume than their job description dictates. Put a clear policy in place that company computers and printers are to be used for company business — period.