Running head: Code of Ethics and Code of Business Conduct
Code of Ethics and Code of Business Conduct
Grand Canyon University
Business Ethics BUS-604
December 23, 2009
Abstract
Phatax Incorporated is a leading manufacturer and distributor of diagnostic medical equipment. We are known for bringing quality products and quality service to our customers. In light of recent scandals such as the collapse of Arthur Andersen, Enron and WorldCom we are very interested in developing and Ethics Program. Many of these companies failed because of a lack of communication of the employees to upper management. The employees were unable to report unethical issues to management without the fear of being scrutinized or worse yet fired. This resulted in low employee engagement. At Phatax Incorporated we will have a ethics program that addresses the Sarbanes-Oxley which promote an
1. “honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;
2. full, fair, accurate, timely, and understandable disclosure in the periodic reports required to be filed by the issuer; and
3. compliance with applicable governmental rules and regulations.” (Sarbanes Oxley Simplified, 2009)
Another reason for the implementation of the ethical program within Phatax Incorporated is due to the increase of litigations within the business environment. For instance, Home Depot is an organization that has an established ethical program but has come under fire through legal litigation from employees and the environment. Through their established system, Home Depot has been able to make adjustments to their business to address the concerns of their stakeholders. It is also imperative that the ethics program of Phatax Incorporated address corporate responsibility. (Ferrell, Fraderich, & Ferell, 2008) The ethical program implemented by Phatax Inc will help to avoid litigations as a whole and help to implement changes quickly when gaps are found in our processes.
Corporate responsibility can change the overall image of an organization. A strong ethics program can promote a strong public image. For example, Starbucks came under scrutiny because they were paying the Guatemalan workers a daily wage of $2.50 a day. Which meant it would take a person that picked coffee beans approximately five days to earn enough money to purchase one cup of coffee. In spite of this humans rights violation of paying worker below a living daily wage Starbucks was awarded the International Human Rights Award by the Council on Economic Priorities (CEP) at its annual "Corporate Conscience" awards ceremony. (Entine, 1996) Starbucks was able to achieve this by listening to the concerns of grassroots protestors and “a reputation as a new-breed, values-driven corporation. Starbucks became the first company in the agricultural commodities sector to announce a "framework" for a code of conduct.” (Entine, 1996). Devloping a strong public image is not the primary reason for devloping corporate resonsibility in Phatax Incorporated ethics program but it is a positive outcome. It is important to Phatax Incorporated that as an organization we are viewed as a strong positive organization that cares about people and not just profit and strives to do business with the utmost of integrity and honor. To be successful as a company it is imperative that our organization develops a tailor-made code of ethics and ethics program. This program will be a direct reflection of how our employees treat each other and our stakeholders. The ethics program will be have multiple sections an inspirational section which will be our code of ethics, and also the rules that define acceptable behavior in Phatax Inc. The ethical standards will be compatible with social norm but go beyond common morality. The ethics program will be influenced by the opinion of our employees and key stakeholders. We will review other
