Ncita

Gabriels
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 An ethical culture does contribute to business performance

• Most companies tend to conflate codes of conduct and codes of ethics, and fail to understand
that while the former is directional (protecting the company, through strict rules, from the risks
associated with misconduct), the latter is inspirational (including core values that contribute to
building a corporate culture). Furthermore, reporting on corporate ethics performance is also
being done in a problematic manner, ranging from vague commitments to negative reporting
(on the absence of misconduct, rather than the presence of ethics management). A key element
in ensuring the embedding of a code of ethics is the tone emerging from the top of the
organizational hierarchy.

These were some of the key ideas Schalk Engelbrecht, manager in

emerging from an Audit Committee forensics at KPMG, pointed out that
Forum roundtable seminar, jointly hosted ethics, in a business environment, is a
by professional services firm KPMG and “notoriously difficult subject to broach”.
the Institute of Directors. Discussant, Dr

Some of the myths that have developed around unethical corporate behavior are vested
on the notion that it arises out of the actions of a few individuals. In addition, businesses
often do not realize that ethical behavior can add value to their activities, and that

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 managing ethics is about changing an environment rather than weeding out or
converting “bad apples”.

The key elements required to develop, implement and maintain an internal code of ethics
include an analysis of ethics risks and opportunity, the subsequent development of a
code the integration of the code in corporate behavior and reporting on ethics
performance. “Every organization already has a culture. A corporate culture is the unique
personality of an organization, and includes anything form working hours to dress code.
But an ethical organizational culture is on one which employees are empowered and
encouraged to act in ethically responsible ways

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(www.kpmg.com)
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