Code of Business ethics.

Essay by rscrimoUniversity, Bachelor'sA, November 2005

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A business code of ethics is important for the purpose of promoting ethical

thought and behavior within a business. The code should be clear, comprehensive, and to

the point. For a code to be effective it should be understood by everyone. Moreover, it

should be enforceable and clearly stated within, how it will be enforced. It must not leave

out any of the stakeholders that may possibly conduct any kind of business with the

company. I have chosen to evaluate how effective the Caux Roundtable's code of ethics


A code should clearly communicate to the audience its purpose. The code serves a

second purpose as a guideline for the company. It should emphasize exactly what is

expected from the employee. The Caux's code does exactly that. The company's sense of

value is very clearly expressed throughout their code. It even has a section to itself

dedicated to how an employee should be treated.

The proper business behavior is very

easy to understand. Respect for the rules is one of the main highlights they go over.

Furthermore, it goes a step further to make ethical decisions. It doesn't stop at just

obeying the rules; it goes one more step stating that just because something it legal to do,

doesn't mean that it is the right thing to do.

Many codes leave out one very important factor; how it will be enforced. Like

any set of rules or guidelines if you don't list how they will be enforced, and implement

the enforcement, many will chose just not to obey them. Caux's code does a great job of

explaining how business should be but lacks describing how business is going to be. I

believe it is important to stakeholders to know that the code is not just a bunch of empty


I believe the most important element to writing a code of ethics for a business is

to write it from all of the stakeholder's perspectives that may conduct business with the

company. After listing the way things should be done, Caux's code does a good job of

listing the responsibilities it holds to give the customers, employees, owners, investors,

suppliers, competitors, and communities. It has a section dedicated to each of the

stakeholders at hand. No one is left out. Furthermore, they even include their

responsibilities to their competition. This gives the reader the idea that Caux truly

believes in a social duty to everyone. When a company states it will give fairness to

everyone, it helps to promote positive business ethics to everyone.