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Ethics
Today Online This newsletter
is published by the Ethics Resource Center.
** From the President's Desk: Globalization and Corporate Social Responsibility In February I had the privilege to participate in one of the sesquicentennial events for Manhattan College, addressing an audience of students, faculty and citizens and facilitating a panel on Globalization and the American Corporation. The panel was composed of respected business leaders, a representative from the U.N. Global Corporate Compact, and one of the most esteemed theologians in America today. What became clear from our discussion and audience questions was the continuing need to better understand the ethical dimensions of globalization and corporate social responsibility as well as the intersecting role of the market and democracy building. Although the panel focused primarily on a case study that negatively viewed the role of multinational institutions in globalization, many in the audience were more interested in how, after the market disasters over the past two years, the panel could justify its confidence in the ability of corporations to behave as "moral" actors. While it's true that many multinational organizations have been criticized justifiably for some of their activities, this is only half the story. Missing from the conversation is the sea change that has occurred, especially at the World Bank. Under the leadership of James Wolfenson, the bank has moved from avoiding even the mention of corruption to focusing on the perniciousness of corruption in loans. More importantly, they have provided concrete research and tools to attack the foundations of corruption. Many American and global corporations have also demonstrated tangible change, investing in corporate social responsibility (CSR) and having a real impact around the world. While some CSR programs are probably window dressing, many corporations are genuinely committed to addressing environmental, labor, child welfare, health and economic justice issues. From Royal Dutch Shell's commitment to the environment to Nike's activism in dealing with their subcontractors on issues of child labor, things are happening. Not perfectly, but it is clear that CSR has become a marketplace standard to which corporations must address themselves. Along with the benefits, CSR can also create dilemmas and distortions. Is there an obligation to pay a fair wage - not just a wage that will allow subsistence? This question resonates from Thailand to West Virginia and from Brazil to Wales. If the salary of an assembly line worker is three times higher than that of a doctor (who may be part of a government system), what happens to health care? Do those who pressure a company to end the use of child labor in manufacturing intend for the closing of the plant to force the children into prostitution? Not likely, yet this has happened. This does not mean we should give up, only that we must focus on both policies and results, programs as well as unintended consequences. Above all, this should not become an excuse to do nothing. Corporations are, consciously or unconsciously, moral actors in both the global market and the movement toward democratic institutions. In that light, they must recognize the need to include focused ethical discussion within the broad corporate social responsibility mantle. Stuart C. Gilman, President ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ** New Edition of "Creating a Workable Company Code of Conduct" Now Available The ERC has revised and updated the publication "Creating a Workable Company Code of Conduct". First published in 1990, this tool was designed to help an organization develop and implement a code of ethical business conduct or revise existing standards and policies. The updated document provides answers to important questions such as:
The publication also includes a variety of tools for code development, such as definitions, sample survey questions, sample interview and focus group questions, a template and worksheet for writing code provisions, and examples of company codes. Additionally, the new edition incorporates timely information on the US Federal Sentencing Guidelines, In Re Caremark, The Sarbanes-Oxley Act of 2002 and the modified Securities and Exchange Commission guidelines. "Creating a Workable Company Code" pulls together information publicly available and information not previously published and melds the pieces together to create a comprehensive guide that dispels the mysteries of code creation. The new workbook-sized publication will be available in mid-March from the ERC for $25. View more information about and excerpts
from the document at: Order this publication at: Please note: This publication is currently in production and will be shipped the week of April 7, 2003 ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Ten Writing Tips for Creating an Effective Code of Conduct You have been given the task of writing an effective code of conduct for your organization. A blank pad of paper rests in front of you along with a freshly sharpened number two pencil and a mint fresh copy of Roget's Thesaurus. Ten minutes pass. Twenty minutes slip away. You've held meetings, sought and received input, looked at samples, identified provisions you want in your code of conduct and yet nothing springs out of your mind and onto the page. Why not? You're a good writer. You were chosen for this project because your reports are fact filled and precise; you are a champ at describing processes in concrete terms. What's wrong with you? Nothing. You are simply faced with the reality of writing about abstract concepts rather than the physical world. To start writing a code of conduct, think in terms of values, beliefs and expectations rather than facts. In this article, Program Development
Manager Jerry Brown gives ten tips to guide you in the actual writing
of your company code. Read his advice at: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ** ERC Resources on Codes of Conduct More articles related to the development of codes of conduct can be found in the Ethics Toolkit located on the ERC web site. These include:
Browse the rest of the Ethics Toolkit
at: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ERC to Develop Online Codes of Ethics Gateway The ERC is developing a web-based directory of online company codes of ethics, community initiatives, corporate social responsibility programs, and values statements. The two-pronged approach to collecting the codes includes researching information that is available online and soliciting contributions from our readers and web site visitors. We have already collected links to relevant documents on over 100 Fortune 500 company websites and are asking for permission to include direct links to their online codes. If your company has a publicly available code of conduct, social responsibility, values statement or related document on its web site and you would like it to be listed in our online collection, please complete the form found on our web site. If you submit your company's documents, but do not have authority to grant permission to link directly to those pages, we ask that you give us the name and email address for the appropriate person. All entries will be linked to the relevant pages on a company web site with clear attribution to that company; we will not be keeping copies of the actual codes. Submit your online company code of
conduct or related document at: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ International Center Profiles: Necati Guler of the Turkish Ethical Values Center (First in a series of profiles of the heads of the International Centers) Necati Guler, Managing Director of the new Turkish Ethical Values Center (TEDMER) visited the ERC offices in February, giving the ERC staff an opportunity to meet the leader of its newest international ethics center. While Mr. Guler began his career as an industrial engineer in the family business of rose oil production, it was his work with the national and international basketball communities that ultimately led him to the leadership position at TEDMER. He was a member of the Turkish national basketball team and played basketball professionally, exhibiting a talent that he has passed on to two sons, one who currently plays professional basketball in Turkey and one who is playing for a community college in Utah. At the Turkish Basketball Federation, he started training coaches and became head of the department that trains all the basketball coaches in Turkey. He was also a member of the team consisting of colleagues from the United Nations and the NBA that developed a program using sports to help young people from two cultures in conflict come together and learn to trust each other. This basketball camp for Turkish and Greek youth helps them practice tolerance through the values of good sportsmanship and become advocates for better understanding and peace in their communities. Because of his commitment to ethics in the sports field and the values he instilled through his programs with coaches and children, as well as his national recognition as a preeminent Turkish basketball player, he was recommended by a member of the TEDMER Board to become its Managing Director. Mr. Guler was also the Chairman of the Board of Directors of I.F.E.A.T. (International Federation of Essential Oils and Aroma Trades) from 1995-1998, as well as the founding member and Chairman of the Board of Directors of BUMED (Bosphorus University Alumni Association) from 1995-1997. The ERC welcomes Mr. Guler and looks forward to assisting him in the development of the Turkish Center. Read more about TEDMER at: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ** Ask the Expert: The Rolodex and the Former Employee A businessman who has worked in a specialized field for a number of years leaves his current employer and starts his own consulting business in the same field. He has already destroyed his copies of customer lists that belong to the former employer, but is left with a question concerning the use of his personal Rolodex. "Every one of the people on this list I have met through previous employment," he notes. "Everyone on this list is also a personal acquaintance. They are people I have worked with and people I know. It is clear to me that the customer lists are not mine to use. My question is about the ethics of working my personal contacts. Is this ethical?" Principal Consultant Frank Navran and Program Development Manager Jerry Brown both weigh in with answers on this question that is "squarely in the gray area." Read their response at: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ** Free MAXIMize the Moment Lesson: Talking about War and Terrorism The world has changed much in the past 18 months. Today, war and the threat of terrorism are constantly in the news and on our minds. While we are learning to cope with this new world, we don't always have the words to explain it to ourselves, much less our children. At the Ethics Resource Center, we strive to create dialogue about the concepts of ethics and values. As part of this effort, we provide products and services that help families and schools face the tough issues. During this stressful and uncertain time, we are making available for free a special lesson from our school and family character development program that we hope will help you discuss the threat of war and terrorism with the children in your lives, and do so in a framework of values. Read this special MAXIMize the Moment
issue at: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ** Opinion Poll: Talking to Children about Values Children today face an increasing number of difficult issues and challenges, not just threats of war and terrorism, but news about cheating, corporate fraud, and role models who break the law or behave unethically. If you work with children or have children of your own, when do you think is the best time to talk to them about values?
Take our March poll at: Last Month's Poll: In February, we asked which of four characteristics you considered most important in a leader?
See the results of last month's poll
at: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ** How to Support Character Development in Your Neighborhood Schools Help a child you know develop strong character! Now you can donate a MAXIMize the Moment subscription to a school of your choice. This subscription character education tool has been used in schools in 20 states. According to one MAXIMize the Moment subscriber, "teachers use the scenarios and quotes as springboards for discussions of real-life issues and challenges." A subscriber to MAXIMize the Moment Junior (for third to sixth grades) says that "it offers a terrific means of discussing real situations, so our students actually look forward to it. MAX Jr. is a wonderful component of our character education program." Each gift of $99.00 gives a school a full 36 weeks of this innovative character development program - for a school with a student body of 600 students that comes to only 16 1/2 cents per child for a full school year of character education. Donors can designate a school of their choice or let us give a scholarship to a school that has applied for a needs-based scholarship. Schools will be notified of the gift and the donor's name unless the contributor prefers to remain anonymous; donors will also be recognized on the ERC's web site unless they choose not to be so identified. Donate a Gift Subscription to a neighborhood
school (or one that we select for you) at: Learn more about the MAXIMize the Moment
programs at: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Book Review: Moral Constraints on War: Principles and Cases In this book review, Program Development Manager Jerry Brown begins: "It is difficult for me to imagine, but I am about to describe a book on the moral constraints on war as one of my most enjoyable reading experiences in the past several months. Through careful article selection and maintenance of high academic standards, [editors] Bruno Coppieters and Nick Fotion have crafted a book that not only discusses the ethics of war compellingly on a principle by principle basis, but captures the history of recent conflicts clearly and concisely in an even-handed manner." Read the rest of this book review at:
You may also order "Moral Constraints on War: Principles and Cases" from Amazon.com by following the above link. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ERC Supports US Dept. of Commerce Good Governance Program Fact-finding Mission to Samara, Russia ERC Senior Consultant Dr. Anita Baker and Good Governance Program Manager Danica Starks, Office of Eastern Europe, Russia and the Independent States, International Trade Administration, Dept. of Commerce were invited by the General Motors-AVTOVAZ Joint Venture in Samara, Russia, to hold preliminary consultations as a first phase in launching a regional initiative there to promote business ethics. The GM-AVTOVAZ organized a Roundtable of automotive industry leaders and regional and local government officials to gain their support for the development of a center to promote best business practices. During the four-day visit, they also met with NGOs, regional and local government officials, and conducted mini-workshops for 40 business students at the Togliatti Academy of Management and 60 instructors and graduate students at the Samara International Management Institute. At both organizations, they demonstrated tools used in ethics awareness training. Consultations on the proposed initiative are continuing. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ** Publications and Media Coverage -- The article "Ensuring Ethical Effectiveness", in the February 2003 issue of the Journal of Accountancy, considers the role of CPAs in creating, reviewing and enforcing codes of ethics under the Sarbanes-Oxley Act and new rules being considered by institutions such as the New York Stock Exchange. According to author Randy Myers, most public companies - at least in the Fortune 1000 - already have ethics codes. In that case, CPAs may want to help their employers or clients review them in order to make sure they comply with new regulations, and even external auditors might have a role in assessing compliance with codes of ethics. ERC President Stuart Gilman advised taking it further than simply evaluating or testing results encouraging external auditors to sign a statement noting that they understand and accept the client's code of ethics. "This allows the outside auditing firm to comport with the company's internal environment," he said. "It permits a level of independence and says, 'We're willing to obey and abide by the same set of standards the organization holds itself to.'" The article also offers practical advice in sections on "Doing it Right", "Putting Together a Code" and "Finding Help." For example, Stuart describes the correct approach to developing a code as follows: "bring together a multidisciplinary team from all parts of the organization-finance, sales, human resources, operations, marketing, executive-to draft a code, communicate its importance to employees and then involve them in seminars to help understand how the code applies to them and their colleagues." Read the rest of this article at:
For instance, under the "organic" heading, Lee says "Ideally the broader mission and purpose of the organization are translated into values, the values into codes of behavior, and the codes into policies and other performance expectations." On periodic updating, Lee says "A thorough revision should be done every five to seven years to take into account changing business strategies, evolution in the legal environment, new stakeholders and/or the emergence of new issues, such as diversity and corporate responsibility." This two-page article from the January
2003 Harvard Management Communication Letter is available from the
publisher for a reprint fee at: Read this and IBTE's reviews of other
ethics-related sites and publications at:
Frank Navran voiced his thoughts about the ethics of this situation. "What we advise people is there are two issues on the table," he says. "One is whether you are out of compliance, and the other is whether you appear to be out of compliance. What's happening in the situation you describe, there's an appearance of impropriety even though no laws are being broken." He agrees that adhering to the letter of the law may not be enough. "You've got a compliance mentality that says as long as its not illegal, it's OK," he notes. "As a general principle, we really want to get people beyond using compliance, which is a minimum standard. What is the right thing to do here, rather than what does the law do?" Read this article at:
In the article "Martin's Recusal Plan Unique, Experts Say", Stuart said that it would present political problems for a head of government to avoid all appearance of conflict, especially in a parliamentary government such as Canada's where executives are also legislators. "It just seems inelegant, and if you begin thinking about how you would operationalize it, you realize the difficulties, almost the nightmares associated with it," he said. Read the whole story at:
In the final chapter "Whistleblowing as an Export", Johnson discusses how whistleblowing has become part of the attempt to address corruption and improve democracy throughout the world and describes the activities of a number of organizations, including the Government Accountability Project, the United States Agency for International Development (USAID), the Organization for Economic Cooperation and Development (OECD), the US Department of Commerce, the Ethics Resource Center, the American Bar Association, international organizations such as Transparency International and the World Bank, and the Immigration and Naturalization Service. ERC International Programs Consultant Cherie Raven provided information and background to the author for her synopsis of the ERC's international programs and centers. Read a review of this book by ERC Intern
Siobhan McGarry at: You may also order "Whistleblowing: When it Works - and Why" from Amazon.com by following the above link.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ** News from the ERC - On February 20, Dr. Stuart Gilman, ERC President, addressed a group of students, faculty and citizens at Manhattan College and facilitated a panel on "Corporate Social Responsibility: American Capitalism and the Global Marketplace" as part of the college's Sesquicentennial celebration. Other panelists included Georg Kell, executive head of The Global Compact Office at the United Nations; Rev. Leo O'Donovan, president emeritus of Georgetown University and former professor of systematic theology at Weston Jesuit School of Theology; and Larry Zicklin, chairman of the board of the investment advisory company Neuberger Berman and founder of the Carol and Lawrence Zicklin Center for Business Ethics Research at the Wharton School at the University of Pennsylvania. See "From the President's Desk" at the top of this newsletter for more about the topics discussed. -Managing Director Pat Harned and President Stuart Gilman met with SEC Commissioners Cynthia A. Glassman and Paul S. Atkins on February 21 to provide them with information about the Ethics Resource Center and to open a dialog about how the ERC can become a resource for the Securities and Exchange Commission. In the next few weeks, Pat and Stuart plan to meet with other commissioners to discuss the importance of "going beyond compliance" when dealing with the ethics provisions of the recent Sarbanes-Oxley Act. - On March 5, Senior Consultant Dr. Anita Baker met with a group of visiting Fellows from The German Marshall Fund of the United States to discuss "Business Ethics and Governance Issues in the U.S." The Marshall Memorial Fellowship program provides an opportunity for young policy and opinion leaders from 14 European countries and the United States to gain an in-depth understanding of societies, institutions and peoples across the Atlantic. During the three to four week traveling program, Fellows develop a broad knowledge of political, economic and social institutions and issues in their host countries through meetings with city officials, school teachers, police officers, government officials, labor organizers, farmers, community activists, religious leaders, academics and ordinary citizens. Dr. Baker spoke with this group of European business leaders and journalists about governance issues in the U.S., the history of business ethics programs and recent developments in business ethics. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ** Offering Our Thanks As a non-profit organization, the Ethics Resource Center depends on contributions from many generous donors. Without their dedication and trust, many of the programs and projects highlighted in this newsletter would not be possible. The Ethics Resource Center gives special thanks to Guardsmark, LLC, and Ira A. Lipman, Chairman of the Board and President, for underwriting the cost of the 2003 National Business Ethics Survey (NBES). The survey is currently in the field and will be released in late May 2003. Learn more about the NBES at: The Ethics Resource Center also thanks the Claude Moore Foundation for a character education grant to provide MAXIMize the Moment scholarships to 50 Virginia schools. Give a MAXIMize the Moment scholarship
to a school of your choice or one of our scholarship applicants
at: The ERC thanks the following for their contributions of general support:
We invite you to join our loyal contributors
in lending your support. To find out how to contribute or to donate
online, go to: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ The Ethics Resource Center (ERC) is a non-profit, non-partisan educational organization exempt from taxation under the Section 501(c)(3) of the Internal Revenue Code. All gifts are tax-deductible to the fullest extent of the law.
Copyright (c) 2002 Ethics Resource
Center. All rights reserved. Please contact ethics@ethics.org for information about reproducing any of the information contained within this newsletter or on our web site. Back issues of Ethics Today are available online at: /today/et_archives.html The Ethics Resource Center, 1747 Pennsylvania
Ave., NW, Suite 400
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