What Are the Pros & Cons to Having a Written Code of Ethics?

by: Debra Kraft

Source: https://work.chron.comn/pros-cons-having-written-code-ethics-18187.html

An organization's written code of ethics should outline the integrity of the business by embracing
common, core values. Company cultures that are grounded in ethical business practices help build
trust among various stakeholders. Internally, trust builds a positive workplace environment among
employees. Externally, trust builds solid relationships with customers, suppliers, investors and the
communities in which companies operate. A code of ethics sets the stage for such a culture. But if it's
too vague, not followed properly or improperly used, a code of ethics can have the opposite effect.

Writing vs. Living the Code

Writing a code of ethics does not automatically mean employees will adhere to it. Managers should
never believe the real work is done after the code of ethics has been written. Releasing the document
into the workplace is only the first step. Employees need to be aware it's out there. They then need to
read it, understand it and follow it. There is no value in a code of ethics that isn't followed. It is up to
management to ensure that employees are educated on proper conduct as it pertains to their jobs
and work relationships.

Using vs. Abusing the Code

Using the code of ethics properly builds a professional, ethical workplace, but abusing it builds distrust
that can contradict everything it stands for. Employees can abuse the code of ethics if they use it to
engage in personal agendas and vendettas, such as accusing colleagues they dislike of working
against the code. Managers can abuse the code by accusing employees of failing to live up to it during
performance reviews, even if the employees have followed it properly. To prevent abuse, all reports
and accusations of ethics violations should be investigated thoroughly and include tangible evidence
that a code has been violated.

Personal Values vs. the Code

Personal values and integrity should augment and build upon the code, not stand apart from it. A code
of ethics is not a complete play-by-play rule book. It does not clearly define everything everyone needs
to make an ethical decision. If employees are not made aware of this limitation, they could come to
believe that something is ethical because it is not expressly covered in the code. Training and
awareness programs should make it clear that questions should be brought to management or human
resources representatives if the code of ethics in unclear with regard to specific situations.

Local vs. Global Code

A code of ethics that does not provide standards for doing business outside the U.S. could allow for
unethical business practices to occur during global projects. For example, employees might be led to
believe that standard modes of business in some parts of the require undisclosed cash payments to
government agents or other practices that lead to unfair competition. Transacting such business opens
the door to practices that can ruin a company's reputation. A code of ethics must be specific and
consistent across all known variables. For companies that already have a global footprint, the same
code must apply to all locations, worldwide.

Give Reaction on the Article:

A professional code of ethics acts as a guide concerning ethical conduct in a given profession.
However, it has been termed as an obstacle t to intellectual and moral developments. This way or
another, there are advantages as well as disadvantages that flow from applying the professional code
of ethics depending on the context of practices. Code of ethics typically are expressed in terms of how
the company performs its day by day interactions with suppliers, employees, and customers. A primary
objective of the code of ethics is to define what the company is about and make it clear that the
company is based on honesty and fairness. Another commonly defined value is respect in all
interactions, regardless of the situation.

It is true that business ethics is a high standard. There is no universal set of ethical principles that
exists and what is right and what is wrong often depends on the situation. The increasing realization of
this had led to a change in thinking about the effective approaches to getting firms and their
employees to behave ethically. The creation of rules and systems that people and companies had to
follow. But rules are hard to draft and quickly become out of date while systems can tie people up in
business efficiency. This has led to the evolution of the belief that although some level of compliance
will always be necessary, organization must have a vision about why they exist and that ought to be
shared by everyone connected with the company.

CASE NO. 2
Disney &McDonald's Linked to $0.06/Hour Sweatshop in Vietnam
Source: http://www.hartford-hwp.com/archives/54/103.html

Seventeen year old women are forced to work 9 to 10 hours a day, seven days a week, earning as little
as six cents an hour in the Keyhinge factory in Vietnam making the popular giveaway promotional toys,
many of which are Disney characters, for McDonald's Happy Meals. After working a 70 hour week,
some of the teenage women take home a salary of only $4.20! In February, 200 workers fell ill, 25
collapsed and three were hospitalized as a result of chemical exposure.

Background

Included in the Happy Meals sold at McDonalds are small toys based on characters from Disney films.
According to McDonald's senior vice president Brad Ball, the Happy Meals characters from the "101
Dalmatians" movie were the most successful in McDonald's history. Ball adds, "As we embark on our
new global alliance, we anticipate ten great years of unbeatable family fun as customers enjoy "the
magic of Disney only at McDonald's".

Located in Da Nang City, Vietnam, the Keyhinge Toys Co. Factory employs approximately 1,000 people,
90 percent of whom are young women 17 to 20 years old. Overtime is mandatory: shifts of 9 to 10
hours a day, seven days a week. Wage rates average between six cents and eight cents an hour--well
below subsistence levels. Overcome by fatigue and poor ventilation in late February, 200 Women fell
ill, 25 collapsed and three were hospitalized as a result of exposure to acetone. Acute or prolonged
exposure to acetone, a chemical solvent, can cause dizziness, unconsciousness, damage to the liver
and kidneys and chronic eye, nose, throat and skirn irritation.

All appeals from local human and labor rights groups continue to be rejected by Keyhinge management
which refuses to improve the ventilation system in the factory or remedy other unsafe working
conditions. Along with demanding forced overtime, Keyhinge management has not made legally
mandated payments for health insurance coverage for its employees, who now receive no
compensation for injury or sickness.

Many of the young women at the Keyhinge factory making McDonald's/Disney toys earn just 60 cents
after a 10 hour shift. The most basic meal in Vietnam--rice, vegetables, and tofu--costs 70 cents.
Three meals would cost $2.10. Wages do not even cover 20 per cent of the daily food and travel costs
for a single worker, let alone her family.
Questions to ponder:

for less money. This ultimately enables the company that chose to outsource to lower its labor costs.
In this term of agreement Mcdo are not liable in any failure that the outsourcing company done.
Somehow, Mcdo know the risk of this kind of external agencies or company. And they might expect
when their firm work out for external agencies or companies. They are losing control of how those
tasks are being monitored and performed. The failure of Mcdo is to not search more deeper about the
outsourcing company they involved in. And this may affect the company’s reputation.
2 Do you think culture has an influence on how Vietnamese workers were abused as employees? Defend
your answer.

Yes. Vietnamese is really known as one of the people around the world who is hard working. Most of
the people in Vietnam started their business and work hard to grow it. Having this culture especially
having a boss or supervisor who is hard working as them influenced other people toward their jobs.
Thus, result to being forced to work harder and being taken advantage by their supervisor. That’s why
minimum wage was given to those employees. However, this kind of management might see as
abused to the employees especially having this little amount of salary that they are receiving after
working for 70 hours per week without an off in a week. As stated on the background, many
employees suffered from illness and most of them collapsed during work caused by the materials using
to make toys. Thus, it shows that the company does not have a good environment for their employees.
According to Farhan Haq, group of people working in this company group worker are concern to their
health problems, dismissals, and low wages have taken the issue up. It is shown that most employees
are enduring this kind of culture because they do not want to lose their job.

U.S.-VIETNAM: McDonald's 'Happy Meals' Sad for Workers, Study Says. (n.d.).
Retrieved November 20, 2020, from http://www.ipsnews.net/1997/05/us-vietnam-
mcdonalds-happy-meals-sad-for-workers-study-says/