Practising what is preached

Corporate codes of conduct are a necessary but not sufficient condition to prevent ethics and compliance failures, a new survey of chief compliance officers in Europe's top 500 listed companies found.

by Integrity Interactive, the Association of Corporate Counsel (ACC)
Last Updated: 23 Jul 2013

According to the 2007 European Corporate Integrity Survey, 99% of companies have a code of conduct or a set of rules setting out what people can and can't do, but only half of them ensure that all their employees are aware of it. This is despite the fact that 72% of companies believe that employees should be privy to it.

"The majority of companies have gone through the process of developing a formal code of conduct or set of values," explains Frederick Krebs, president of the Association of Corporate Counsel, "but differences remain in how much progress has been made in disseminating, implementing and monitoring the effectiveness of these codes. Companies in the US have spent the last few years ratcheting up their efforts on ethics and compliance but many of their European counterparts still have more work to do."

Part of this mixed landscape is due to obstacles within companies, such as conflicting priorities (54% of cases), lack of necessary skills and resources (29%) or lack of budget (25%).

Yet businesses are aware that they face increasing pressure to follow better compliance, be it from customers, investors or the board. Half the companies surveyed also want ‘to do the right thing', while 38% are aware that better ethics would protect their brand.

"It is not good enough to have codes of practice buried on an intranet site where employees have to proactively seek them out," says Paul Basson, president of Integrity Interactive Europe, who carried out the survey. "Training on codes and policies and the evaluation of levels of understanding play a significant role in protecting a business against scandal and without it, many could be heading for trouble."

Source: 2007 European Corporate Integrity Survey
Integrity Interactive, the Association of Corporate Counsel (ACC)

Review by Emilie Filou

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