Ethics & policies. On the tongue, are they on the lung?

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Policies & ethicsI was struck by a recent headline, “55% of small firms don’t have an ethics policy”.   The article referred to a survey of ‘SMEs’  and I must say I was surprised that there are as many as 45% that actually have an ethics policy!

Does the lack of an ethics policy mean that a business lacks ethics?

The smaller a business the more likely it is that staff will have direct contact with the directors and in most cases there will be relatively few written policies.

As businesses grow, staff have less day to day contact with the board and when layers of staff are added, there is a greater chance of messages from the top being diluted.   Policies are one way of setting out the ground rules.

Policies can cover day to day matters, such as an expenses, how an organisation deals with its customers and things that (hopefully) are not encountered every day, such as what to do if wrongdoing is discovered (whistleblowing).   Policies can set a framework for dealing with matters ethically and even if there is no ‘ethics policy’ per se, it doesn’t in itself indicate a lack of ethics.

Policies in place? So what?

One problem for staff is policy overload – it can be difficult to digest and retain every policy.  While I have no first hand knowledge, I would expect that VW had ethics and whistleblowing policies – but actions really do speak louder than words!

How do you make the words become actions?

Here are a few thoughts:

  • Are directors and managers ‘policy advocates’ or do they turn a blind eye? If senior people are seen to be keen to apply it then staff are more likely to follow.
  • Where policies relate to day to day procedures then do the systems in place help people achieve compliance?
  • How digestible is the policy? Making it as easy to read as possible should help.
  • What education has there been about the policy?
    • Do people understand why the policy is needed?
    • The longer and more complicated a policy is, the more likely that something more than ‘here is a new policy please read it’ will be needed.
  • Are policies being reinforced? Where policies are related to day to day practices, what checks are there to ensure compliance?   In some cases the policy and accountability can be reinforced, by the completion of a self reporting checklist.

Dealing with the unthinkable

While many policies will be about day to day matters.   What happens if something rare and untoward occurs?   While a business might have a whistleblowing policy – would it be applied in practice when there is wrongdoing?

  • How aware are staff of the need to whistleblow and the channels?
  • Are the board accessible to staff?
  • Will the board be supportive if unacceptable behaviour is reported?

Wrapping up

Policies can be helpful in terms of establishing ground rules, but they can also be a pain for staff to read through and absorb.   What really counts is actual behaviour.   With that in mind I’m not convinced that 55% of SMEs lacking an ethics policy should in itself be a cause for concern, when staff are likely to have frequent contact with directors.

And as far as larger organisations with a plethora of policies are concerned I think it may be worth asking – your policies may be on the tongue but are they truly on the lung?

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