Complying with organizational code of conduct

When a new employee or a fresher joins a corporate organization, it is imperative to introduce him or her to the corporate culture and ethics of the organization. Every individual comes from a different background and culture, but when they enter the organization, they must adopt a uniform culture of the organization. This ensures that the organization runs smoothly, in a unified manner, and moves as a well-coordinated team towards achieving its group goals.

The organizational Code of Conduct forms a crucial part of this effort to create a unifying environment within the organization. It is a well-defined document that lays down the basic philosophy of the organization, and its rules of conduct that all employees and management are expected to follow. Particularly for multi-cultural organizations operating from multiple geographical locations, the Code of Conduct becomes a valuable administrative guidepost to govern the organization efficiently.

The Government of India in its general guidelines for Corporate India has spelled out the key constituents of “Good Corporate Governance.” The organizational Code of Conduct is included among these key constituents. The government’s guidelines clearly emphasize for a system to ensure compliance with such a Code of Conduct by every member of the organization. It says:

“Code of Conduct: It is essential that an organization's explicitly prescribed Code of Conduct is communicated to all stakeholders and is clearly understood by them. There should be some system in place to periodically measure and evaluate the adherence to such code of conduct by each member of the organization.” (1)

The multinational fast food giant KFC, for instance, has established a high moral Code of Conduct for its Indian subsidiary. The company views itself as a hospitality organization with customer service at the center of its operations. Therefore, to ensure that all its young employees who are engaged in direct customer service follow an empathetic attitude. As a result, its organizational Code of Conduct is focused on the human philosophy of, “Do to others what you want them to do to you.” This code is not restricted to customers alone, but also extended to its dealings with suppliers, investors and other business associates. (2)

The Tata Group of Companies, in its corporate Code of Conduct for all its group companies and subsidiaries, places the onus of compliance on every member of the Tata Group. It says that any Tata group employee who sees or experiences any violation of the company’s Code of Conduct is required to report it promptly to the concerned superiors. (3)

The global steel giant POSCO that has established large-scale manufacturing operations in India conducted an “Ethics Management Workshop” in 2007 for its employees in order to “reinforce the ethical Code of Conduct for sustainable management.” At the Workshop the employees of POSCO-India collectively took a pledge to abide by the company’s Code of Conduct. (4)

Such exemplary efforts from the managements of Indian organizations show a willingness to establish an organizational Code of Conduct, and ensure its committed compliance by its constituents. It is especially useful for the newly joining employees who need to be thoroughly acclimatized and integrated with the corporate culture, philosophy and business ethics that govern their organization.

- Vikas Vij (views expressed in the article are that of the author)