COMPARING CODES OF CONDUCT
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Executive Summary
Codes of conduct are important for any corporation seeking to ensure the performance of ethical practices. For GlaxoSmithKline and CQ University Australia, the respective documents illustrate the various aspects that indicate the firms’ strides towards the attainment of ethical practices. Indeed, one of the aims of a code of conduct is to cater for the stakeholders of an organization. According to Buchholtz and Carroll (2012, p. 23), a stakeholder is a person, cohort, firm, or group that can face certain impacts based on the decisions made and actions carried out by a respective organization. In this respect, it is imperative for an organization to ensure that it makes the right decisions as well as engage in moral actions in order to avoid the possibility of a negative effect on the stakeholder. With reference to GlaxoSmithKline and CQ University’s codes of conduct, it is possible to identify the effect of these respective documents on various stakeholder groups. This is because these respective manuscripts concentrate on ensuring the performance of ethical and moral practices in order to pose a positive impact on respective stakeholders. Another aim of the respective documents is to guarantee the requirements that each member of the organization is obliged to comply as well as those that are voluntary. Lastly, the codes of conduct for the firms also focus on the issue of corporate governance and transparency within both corporations.
Table of Contents
Identification of Affected Stakeholder Groups. 4
Identification of Emerging Ethical Issues in Business. 6
Mandatory and Voluntary Requirements of the Codes. 7
Aspects Representing Mandatory Requirements. 7
Demonstrating and Operating in Transparency. 8
Aspects Representing Voluntary Requirements. 8
Exuding High Levels of Personal Performance. 8
Emphasis on Personal Security and Resilience. 9
Regarding Academic Freedom.. 10
Corporate Governance and Transparency. 10
Comparing Codes of Conduct
In overview, codes of conduct constitute a collection of regulations and guidelines that outline the roles of or appropriate practices for a person, party or company. They comprise the tenets, values, principles as well as behavioral rules that direct the decisions, processes and structures of a firm. Accordingly, a code of conduct ensures that the respective elements contribute to the welfare of its main stakeholders and respects the privileges of all members experiencing effects from its operations (Sethi, 2011, p. 24). Undeniably, codes of conduct pave the way for the practice of good ethics within any workplace. In order to understand the impacts that codes of conduct pose, it is critical to assess two documents that represent company ethical codes. These codes constitute the GlaxoSmithKline Code of Conduct and the CQ University Code of Conduct. These manuscripts will undergo assessment in relation to their effect on stakeholder groups and emergent ethical issues, the mandatory and voluntary requirements they possess and lastly, their illustration of corporate governance and transparency within the respective institutions.
Identification of Affected Stakeholder Groups
Employees
One of the stakeholder groups affected by the ethical codes of these corporations constitutes employees. Undeniably, employees are the most important asset of a company. They are usually responsible for the creation of revenue in any firm. In relation to codes of conduct, these documents affect this particular group in terms of the manner in which they perform their activities. Indeed, fair ethical conduct within the workplace illustrates that employees exude pride in their firm’s ethical principles and have deference for other workers, clients, suppliers as well as affiliates. For instance, the GlaxoSmithKline ethical code requires every employee to assume individual responsibility in following its guidelines in order to maintain trust and confidence in the respective workplace (GSK, 2012, p. 3). This principle, as stipulated by the respective document, affects employees by influencing them to abide by it in order to ensure that they sustain fundamental moral aspects within the organization.
In addition to this, the codes of conduct for both organizations also affect employees by requiring them to abide by ethical practices. For instance, GlaxoSmithKline directs employees to restrict from engaging in misconduct. In addition to this, it also requires them to exercise compliance as well as report concerns regarding this respective issue (GSK, 2012, p. 4). The objective of this is to ensure that the company’s reputation remains intact in order to affect other stakeholders such as patients positively. Similarly, the guidelines exuded by the CQ University code also affect the practices of employees within the university workplace. For instance, the respective document requires employees to abide by it. It also directs them to maintain solid ethical principles that enable them to conduct business morally and positively with students. For instance, the document requires employees (university members) to respect an individual’s innate dignity, act on informed conscience, participate as well as preserve communal interest (CQ University, n.a., p. 5).
Customers
Another significant element of the stakeholder groups impacted by the codes of conduct constitutes the customers. Accordingly, each code focuses intricately on ensuring that customers maintain a healthy interactive structure with the particular organizations. The documents affect these particular stakeholders since they place emphasis on the significance of doing good business with them. For example, GlaxoSmithKline focuses on ensuring that its clients, who comprise patients, receive efficient services. To be more specific, the company’s code of conduct asserts that the organization is required to be Customer Driven (GSK, 2012, p. 7). This means that each decision and action taken by the company must occur after ensuring that customers are aware of them. The same also applies for CQ University. Accordingly, the firm’s code of conduct requires its employees to be accurate, prompt and fair to students seeking services within the university (CQ University, 2012, p. 5).
Identification of Emerging Ethical Issues in Business
Conflicts of Interest
Consequently, apart from affecting the stakeholder groups, the respective codes of conduct also identify emerging ethical issues evident in business. One of these issues comprises conflicts of interest. In general, a conflict of interest happens when a person or a firm becomes involved in a miscellany of interests, which have the ability to distort the motivation. The GSK code also provides a description of a conflict of interest in relation to its business. Indeed, it defines it as a situation that occurs when the potentiality of primary or secondary gain may affect judgment while performing GSK business (GSK, 2012, p. 9). The CQ University Code provides examples of this issue, which comprise disputes within personal relationships, financial associations, external jobs and activities, as well as the utilization of confidential information (CQ University, n.a., p. 10).
Based on this, it is evident that conflicts of interest are an ethical issue within corporations. This is because of the negative implications it imposes on its direction towards the fulfillment of goals and objectives. Due to the effects it poses on organizations; the codes of conduct require employees to take certain actions in order to prevent them. For instance, the GSK code encourages employees to resolve issues arising from conflicts of interest. It requires them to avoid actual instances of this issue as well as any form of occurrence that resembles it within the performance of their respective obligations. In addition to this, the Code also requires workers to divulge information regarding potential or genuine conflicts of interest (GSK, 2012, p. 9). The CQ University code also recognizes the impending devastating effect that conflicts of interest may have. Based on this, the document also sensitizes employees concerning this issue and encourages them to report occurrences and even seek advice if faced with resulting issues.
Confidentiality
Another emergent ethical issue as emphasized by the respective codes of conduct comprises confidentiality. Accordingly, the maintenance of confidentiality is essential. This is because it allows organizations to preserve sensitive information concerning their clients. Indeed, failure to sustain such data may lead to instances of extortion and damage to the company’s reputation. The GSK code views information as a valuable resource. Indeed, it is necessary to protect confidential information in order to avoid harm to the corporation and its respective shareholders (GlaxoSmithKline, 2012, p. 10). Furthermore, the code also offers a set of steps that employees can perform in order to ensure that confidentiality of the company information undergoes significant preservation. The CQ University manuscript also emphasizes on the maintenance of confidentiality. Based on the code, University members are required to preserve the security and discretion of formal information. In addition to this, the code also restricts them from using the information in order to act in their particular interests (CQ University, n.a., p. 10).
Mandatory and Voluntary Requirements of the Codes
Aspects Representing Mandatory Requirements
Acting with Integrity
The respective codes of conduct constitute certain aspects that represent mandatory requirements, as well as voluntary requirements. In relation to mandatory requirements, the two documents possess a variety of elements that do not necessarily coincide with each other. However, some of these aspects are similar. Foremost, acting with integrity represents one of the elements considered mandatory within both documents. Accordingly, both codes require employees to perform their duties with integrity. In addition to this, both codes also mandate employees to augment public confidence and exude impartiality in their utilization of company assets such as information. For instance, both codes direct employees to focus on circumventing conflicts of interest due to the negative impacts they pose on the corporations (GSK, 2012, p. 9; CQ University, n.a., p. 10). In addition to this, acting with integrity also entails the maintenance of confidentiality as emphasized by the respective codes.
Demonstrating and Operating in Transparency
Operating with transparency is also another aspect representing a mandatory requirement in both codes. Accordingly, it is imperative for companies to be transparent about their operations to their various stakeholders. This leads to generation of trust as well as enhanced public reputation. Hence, illustrating transparency involves the dissemination of impartial information, provision of accurate, prompt and proper data as well as the assumption that other individuals have the ability to witness a company’s actions (GSK, 2012, p. 13). Similarly, CQ University also necessitates the desire to function with transparency. Indeed, the institution’s code requires its employees to present financial data as well as disclosure accurately in the firm’s accounts. In addition to this, the document also requires employees to guarantee the safety of resources as well as restrict individual utilization of these assets (CQ University, n.a., p. 13-14).
Aspects Representing Voluntary Requirements
Exuding High Levels of Personal Performance
However, certain elements provided by the two codes are voluntary and are thus dependent on the decision of the employee to perform. One of these aspects involves exhibiting the best performance. Accordingly, the GSK code requires employees as well as their respective supervisors to exude high individual and expert conduct (GSK, 2012, p. 16). However, this aspect is not an ultimatum; rather, it is a certain choice that employees can make in their own terms. Even though it is the right thing to do, it is impossible to gauge the determination of each employee in relation to exhibiting unusually high levels of personal conduct. In addition to this, supervisors (specifically managers) can also set the limits to which performance is required to be fair. However, they cannot coerce every employee to meet very high expectations since each person possesses a different character from another.
Emphasis on Personal Security and Resilience
Another aspect, as evident within the GSK code, is the emphasis on security and resilience. Accordingly, the respective code of conduct requires every person to be liable for the creation of measures fit for personal protection as well as the safety of other workers and company assets (GSK, 2012, p. 18). Even though this is also preferable, it is also voluntary. Accordingly, people possess different ways of protecting objects. Based on the value of these objects, individuals tend to illustrate different forms of security levels. This also applies in this case. Indeed, by placing this responsibility among employees, GSK actually creates a choice for employees to apply security measures at different standards. In addition, it is also impossible for each employee to guard another since security is a much individual role in companies. Moreover, it is also impossible for every individual to exude a comparable degree of resilience. Since it remains unspecified, then employees can choose to dedicate different levels of resilience in relation to the plea on security.
Regarding Academic Freedom
In relation to the CQ University Code, showing respect for the academic liberty is also a voluntary requirement. Indeed, even though the Code requires University members to be loyal academicians to the institutions, it also endorses them to engage in further academic pursuits (CQ University, n.a., p. 8). This is not a mandatory requirement in any way. This is because the employees have the choice to either continue or be intact with their certifications. Regardless of the actions they take, there is lack of a substantial impact on the University. In addition to this, University members may also focus on other academic pursuits with personal scholarly inquiry principles. Even though the code states that employees can pursue their studies in agreement with proper tenets of scholarly inquiry, it is not entirely possible to govern the level of scholarly standards since members may have different levels of interests within their particular fields of concentration.
Corporate Governance and Transparency
The contents of the two codes of conduct reflect on the subject of corporate governance and transparency within both institutions. Indeed, the issue of corporate governance is very significant to every organization. Due to the corrupt practices of former corporations such as Enron and WorldCom, companies have focused on integrating structures that illustrate their commitment to effective management. The practices carried out by Enron such as complex financing schemes through Special Purpose Entities as well as stock options presented financial figures that did not match with the financial data availed to the shareholders and owners (Arnold & Lange, 2004, p. 754). Hence, it is understandable for corporations to focus on corporate governance and transparency issues as reflected in GSK’s and CQ University’s codes of conduct. The GSK code focuses on both issues separately. For instance, the corporation places emphasis on the issue of transparency especially in terms of the company’s operations as well as financial performance.
Indeed, in order to avoid mistakes, the respective document indicates that GSK focuses on delivering accurate information in order to avoid misleading its particular stakeholders, as well as the global community. In addition, the corporation also abides on the element of transparency by guaranteeing ethical government dealings in numerous countries as well being aware of foreign business borders (GSK, 2012, p. 14). These actions of transparency allow the corporation to perform its business in a compliant manner that strengthens its reputation and augments its transparent business interactions in other international regions. In relation to corporate governance, the GSK code illustrates that GSK focuses exponentially on corporate social responsibility. This also applies similarly to CQ University based on its code. Accordingly, CQ University carries out social responsibility schemes by ensuring that it responds to the needs and distresses of the community. In addition to this, the code also implies that CQ University applies CSR practices in routine business practices (CQ University, n.a., p. 12).
Conclusion
In conclusion, the codes of conduct for GlaxoSmithKline and CQ University provide evidence that both organizations exude focus on ensuring ethical practices. These codes of conduct are more than mere guidelines. They also specify the aspects required for every employee of the respective organization. The main reason for this is to ensure that employees abide by the ethical principles emphasized by both corporations. Furthermore, the respective codes also illustrate the commitment of the firms towards corporate governance as well as the issue of transparency. By documenting these specific aspects, the two manuscripts offer a concrete insight into the moral and principled practices that both companies are striving to achieve in order to benefit their stakeholders.
References
Arnold, B & de Lange, P 2004, ‘Enron: An examination of agency problems’, Critical Perspectives on Accounting, vol. 15, no. 6-7, pp. 751-765.
Buchholtz, A K & Carroll, A B 2012, Business & society: ethics & stakeholder management, South-Western Cengage Learning, Mason.
CQ University Australia n.a., Code of conduct, CQ University, Australia.
GlaxoSmithKline 2012, The GSK code of conduct: One company, one approach, GlaxoSmithKline Plc, Brandford.
Sethi, S P 2011, Globalization and self-regulation: the crucial role that corporate codes of conduct play in global business, New York, Palgrave Macmillan.