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Some businesses (such as public companies) are legally required to have a code of conduct. But even if it’s not required by law, every business (including yours) should have a code of conduct (sometimes called a code of ethics) that outlines how the business is run.
According to Ethics and Compliance Initiative, “A code has value as both an internal guideline and an external statement of corporate values and commitments.”
Internally, it serves as a guide to help employees make the right decisions. Externally, it helps your business mitigate risk, stay in compliance, and convey your mission and values to the public.
Before jumping into the “why,” it helps to understand the definition first.
So, what is a code of conduct policy? A code of conduct for employees sets a foundation on which your company is built and spells out your company’s mission and values.
It establishes a benchmark of behavior and expectations that serve as the norms for employees at every level within your organization. It addresses issues such as ethics, compliance, diversity, and inclusion.
It might also be helpful to point out that a corporate code of conduct and corporate code of ethics are often used interchangeably, as considerable overlap exists between the two. In a nutshell, they both focus on the same goal – setting behavior expectations for employees to do the right thing.
How does your business benefit from creating a written code of conduct policy? For starters, it helps employees conduct themselves in a professional manner, thus creating a culture of respect.
A code of conduct helps employees make the right decisions, thus avoiding conflict of interest and abiding by legal requirements set forth by the government and the industry. It builds trust among all levels of employees and fosters honest communication. And a code of conduct sets a top-down tone of expectations, thus establishing credibility for your organization
The core message here is about setting clear expectations, but also formalizing it so employees can’t claim they didn’t know that expectation. However, this policy, in particular, is so foundational to the core principles of the business and to its culture that it’s broader and more important than, say, a vacation policy or IT security. It sets the tone for the type of company your business strives to be.
One final point here: Simply writing a code of conduct policy isn’t enough. You must incorporate this policy into a comprehensive strategy that includes communication, training, enforcement, monitoring, and evaluation. And, like any policy, you must leave room for change, as policies are living documents that evolve to reflect current circumstances.
Bear in mind that there is no absolute right way to create a code of conduct. Your company culture and conduct expectations will be different than other companies. That is why you need to tailor the elements that cover the nuances of your organization. Typically, though, these are a good starting point.
Need some additional inspiration on what to include in your code of conduct policy? Check out some stellar policy examples from Apple, Intel, and Amazon.
Whether you’re writing your first policy or adapting existing policies, you might be wondering how to write a policy that addresses your code of conduct. Crafting an effective corporate policy takes thoughtful planning, research, and revision. It also takes the right people. If you struggle to assemble a diverse group of influencers from your organization, it might help to bring in a consultant or legal professional to help facilitate the process.
The first step to creating an effective code of conduct policy starts with pulling the right people into the process and gathering the relevant documents. Involving the right internal personnel could mean, for example, tapping Human Resources, General Counsel, and Finance.
The key staff members you include need to have a solid understanding of where things are now (through current policies) as well as a vision for where they could or should be. Making these employees part of the process may take more time (more people always equals more time), but it will produce a better and more robust policy.
Furthermore, adopting a multi-disciplinary team approach enhances your ability to craft a code of conduct policy with an eye toward diversity and inclusion.
According to Project Include, “Company leaders across functions should be involved in the process of drafting codes of conduct to think critically about how to build culture on their teams, and how to build bridges with other teams.”
Like any important document, the policy draft is the first attempt. Don’t expect the draft to be perfect from the get-go or to cover everything that needs to be covered. But creating this rough draft makes it is easier for leadership to give their feedback into a working document rather than asking leadership to create something from scratch.
When you begin to create your draft, make it as complete, accessible, and transparent as possible. Your policy should be inclusive, displayed promptly for both internal and external audiences to read.
It should be written in clear, easy-to-understand language free of corporate jargon or legalese. Your code of conduct should also include your corporate values, clearly stating what you stand for (and maybe even what you don’t stand for).
Your policy should get specific on the diversity your company strives for, including both legally protected classes of people as well as groups that might commonly get excluded. Don’t forget to include conduct that occurs offsite at work-related functions. And outline the process for what employees should do to report an incident, such as harassment or discrimination.
The big takeaway? Get something in writing first, then go back to those employees you identified as being key to the process. Otherwise, the tendency is to let something as big as a corporate code of conduct get bogged down and never see the light of day.
Your entire team needs to allocate enough time to read, approve, and sign-off on your code of conduct policy. In fact, it might be good to forewarn the policy-drafting team that this process will take longer than they expect.
You will most likely need to remind team members to do their part in reviewing, approving and providing feedback. A policy this broad and this sweeping can be difficult to get people’s minds around – so it’s natural to take longer with complex issues. This is normal and expected, but they do need to give input for this policy to work.
The distribution plan is really two-fold. On a big-picture level, you need to deliver your code of conduct policy to employees when it is complete.
Employees need to know what the policy says and the company needs to track signatures proving employees have received and read the new policy.
A policy management software like PowerDMS can help you get policies signed fast. In particular, automated alerts will notify employees when a new policy is due for signature or when a revised policy is available.
From an operational standpoint, you need to have a rollout plan in place. If this is the first version of the code of conduct, employees need some transparency into the process of creating it, who was involved, who has approved it, etc.
But they also need to know why it was created and the purpose it serves. Don’t let employees think it was created because some employee made a mistake and now everyone has to sign the new code of conduct. This is as crucial to the adoption of the policy as anything.
If this is a significant update to an existing code of conduct, they also will want to hear why it was changed.
If this is a new code of conduct policy, think about creating some training around these new standards of professional conduct.
What are some real-world scenarios of what to do and what not to do? How does this policy apply to employees’ everyday work? What are the steps to take to report a violation or to ask questions?
On the other hand, if this is an update to an existing policy, you need to make sure your existing training reflects the changes.
Either way, don’t make (or revise) policies in a vacuum. Training to your policies is a great way to reinforce the content and to improve retention. This is often the difference between someone reading it on paper and putting it into practice.
Whether you’re creating a new corporate code of conduct policy or revising an existing one, you can now incorporate key elements and write an effective policy that sets the benchmark for employee behavior expectations.
Clearly communicating this policy and training to this policy will help employees perform their jobs in line with your company’s mission and values.
Need help managing this full policy process? Implement a code of conduct policy from start to finish can be a daunting task, so turn to a policy management solution like PowerDMS.
This robust software can help you implement each element quickly and efficiently every step of the way. Plus, taking an automated policy management approach saves time, reduces costs, provides centralized access, ensures consistency, and helps reduce your company’s risk and liability.
Now that you understand code of conduct policies, learn more about the 10 policies your organization needs.