E&C Pulse - October 18th

October 18, 2018 Ben DiPietro

When is the Last Time You Looked at Your Code of Conduct?


A code of conduct may be the most vital thing an organization produces, as the values espoused in the code are intended to shape the creation and sale of every product or service that's brought to market, the way employees treat each other, and the way they conduct business.

But a code is only effective if the people in your organization read it, live it and put its tenets into practice in their everyday work interactions. 

LRN produced a white paper that looks at ways an organization can bring its code to life so its employees can better harness its messages into their daily responsibilities, and so outside stakeholders know what you stand for and what they can expect if they do partner with you. 

A code "is fundamentally about behaviors, yet most companies are not as well placed as they might be to establish and reinforce the expectations of right behaviors," said the LRN paper. "Codes of conduct, which ought to be the primary resource and guide here, are too often failing to connect with company purpose and values, leaving employees uncertain about why the right behaviors matter." 

The most important thing is to make your code a resource that employees can refer to as they go about their jobs, if they have questions about a policy or are unsure about the right thing to do, said Jim Walton, an advisor for ethics and compliance at LRN. 

Walton identifies the three elements of a best-in-class code. 

First, a great code is engaging. "As soon as a reader sees it, they should get the sense that the content is important and compelling and feel drawn in to learn more," he said. 

Second, it is unique to the organization and doesn't read like boilerplate. The code is tied to the company’s purpose, values, business, brand and heritage. "Employees can see themselves, their colleagues and their workplace in the code," said Walton. 

Third, it's user-friendly, available by computer and mobile devices. It is set up for easy navigation, with links from the table of contents to specific topics, relevant policies and other online resources. It's written in plain language, easy for all readers to understand, and translated into local languages. 

What if your code is not where it needs to be? Here are five signs your code is stale and needs a reset: 

Your code is legal mumbo-jumbo. 

You code is stale if it was last written by the legal and/or HR department, if it's just a legal document covering harassment, FCPA, anticompetitive behavior, and compliance with laws and regulations, said Brian Beeghley, chief executive of compliance firm Informed360. "That's not to say those former items are not important or shouldn’t be included, but they shouldn’t be the only focus," he said. 

In addition to legal and HR, Kristy Hart-Grant, founder of Spark Compliance, said the code team should include people from sales and finance, and also should have folks representing international offices and regions where the company operates. Walton advised the team be led by ethics and compliance, and in addition to legal and HR also include marketing and communications. Both say the code should be reviewed annually but major overhauls undertaken every three to five years. 

Your code is boring. 

Codes should have a personality and speak with the vernacular of the company, and your company’s values should "shine throughout" the document, said Hart-Grant. 

"I still come across codes that are written in black and white, or that have no graphics or design whatsoever," she said. "If it looks like any other policy, it’s just not good enough for a modern compliance program." 

It's not fully aligned with your organization’s purpose, mission and values. 

Companies, feeling restricted due to an array of external regulations, tend to impose complex systems of internal checks and controls on their various stakeholders, but this "impulse toward control-oriented, top-down management fits poorly within a business environment marked by rapid change, disruptive technologies, greater mobility and 360-degree communication," said LRN in the paper.

So how can companies keep their employees inspired, their customers loyal, their supply chain partners engaged, and their other stakeholders invested?

Simply sticking to obsolete power dynamics is unlikely to work, as is unbolting old systems of rules. LRN suggests striking the right balance between creating new opportunities for self-expression, and ensuring this self-expression is aligned with the organization’s goals.

The perfect balance of freedom can be understood as the synergy between "freedom from" and "freedom to." That means doing away with old systems of rules, top-down power systems, one-way communications and a lack of transparency—while aligning behavior around a system of shared values to achieve common goals and results.

Your leaders don't live the code.

Mission and values (MV) statements often are ignored and seen as signs of hypocrisy, mostly in instances when there is a mismatch between rhetoric and reality. "When leaders say one thing and then do another, the MV language doesn’t just get ignored by employees, it saps their morale," said the paper.

When conceived of improperly, codes can serve as a substitute for real ethical leadership, which is the role of immediate managers, supervisors and leaders, said Beeghly. "They are the ones who should make the code real and tangible to employees on a daily basis through their actions, and through their words," he said. 

Ethical leadership is much more important than a code, as personal integrity, role modeling and holding others accountable for their behavior has a disproportionate impact on employee behavior than any code, said Beeghly. "Any good that comes from a code gets easily wiped away by the actions or inactions of a manager or leader," he said. 

It's not accessible via social media or through an app. 

The code should serve as a gateway to your organization’s ethics and compliance program, said Walton. 

"Employees should be able to pull up the code on their desktops, laptops, smart phones, or tablets and get the information they are looking for with one to two clicks," he said. "As they navigate, they will be reminded of the importance of acting with integrity, how it ties to the companies purpose and values, and why it’s important to the business."



(Elie Wiesel Foundation essay award winners pose with LRN CEO Dov Seidman and Elie's wife, Marion Wiesel. From left: Jacob Saliba, Megan Phan, Areeba Khwaja, Dov Seidman, Marion Wiesel, Ana Barkley, and  Sarah Hagerty.)

Wiesel Award Winners Demonstrate 'Courage to Understand'


The Elie Wiesel Foundation Prize in Ethics Essay Contest encourages students to write thought-provoking personal essays that raise questions, single out issues and offer rational arguments for ethical action.  

Elie Wiesel was a Holocaust survivor, author and champion of human rights, who devoted his life to fighting indifference, intolerance and injustice. He and his wife, Marion, established the Elie Wiesel Foundation for Humanity shortly after he won the Nobel Prize for Peace in 1986. 

The foundation and its partner in the contest, LRN and its CEO Dov Seidman, last week announced this year's essay winners, with 2017 Syracuse University graduate Megan Phan named first-place winner. 

Phan wrote a letter to her father, a police officer of 25 years, in which she called her dad her hero but questioned how some people in law enforcement interact with communities of color. Her essay considered how to build trust between those who think Black Lives Matter and those who feel Blue Lives Matter. 

She wrote: "We all possess varying degrees of ignorance, and we should not be ashamed of this. We should embrace our ignorance and then get to work--to read more, converse more, engage more. Not doing so is counterintuitive to any future toward social cohesion." 

Speaking at the awards dinner, Seidman said the essays are a testament to the moral courage of the students. 

"They are forging a path of moral leadership. They are, as Professor Wiesel would say, thinking higher and feeling deeper. We are in an era when there is a vacuum in that area and closing that is an urgent task," said Seidman.

Addressing the students directly, Seidman said: "This says so much about your courage. You see yourselves as moral leaders, with the courage to do things and say things that need to be said. Elie said he wrote not to be understood, but to understand, and that’s what you have done." 

Sarah Hagerty of Eckerd College was awarded second prize; Jacob Saliba of Ohio Dominican University was awarded third prize. Areeba Khwaja of University of Texas-Austin, and Ana Barkley of Winthrop University received honorable mentions. 

Click here to read the winning essays.


LRN's 2018 Ethics and Compliance Program Effectiveness Report asked respondents whether their organization's ethics and compliance program and efforts have increasingly focused on values, and not just rules, over the last five years.

56% said they have to a great degree;
30% said they have somewhat;
11% said they have very little; and
3% said they have not at all.


As debate over global warming moves to talk about how science and technology can reverse the trend of rising temperatures, the Christian Science Monitor advocates for thinking about the ethics of doing so. 

Divergent views on privacy and regulation in Europe, China and the U.S. may lead to the creation of three separate internets; The New York Times wonders about the ramifications. 

Board Agenda looks at ways a board can discern an organization's "ethical health." 

A Forbes post explores how a whistleblower brought down Danske Bank's "culture of silence." 

There are ways to nurture your board to make it more effective, and Directors & Boards spells out ways to grow a better board. 

The #MeToo movement is having an impact in India, where the country's junior foreign minister was forced to resign after at least 20 women accused him of sexual misconduct, Axios reports.

The Council on Foreign Relations finds most countries have laws that make it more difficult for women to work than men.

Questions, thoughts, opinions? Let me know at ben.dipietro@lrn.com.



Bring Your Code to Life: Best Practices for an Effective Code of Conduct

Learn how to develop a mission-oriented, values-based code that is unique to your company’s culture and relevant to the needs of the business.



Compliance Perspectives Podcast (SCCE)

Our own Marsha Ershaghi Hames discusses how to set the right tone on the ground in this recent SCCE podcast with Adam Turtletaub. 


Previous Post
E&C Pulse - October 23rd
E&C Pulse - October 23rd

In this edition of E&C Pulse, Ben recaps two very informative sessions from SCCE'S CEI Event in Las Vegas.

Next Post
E&C Pulse - October 16th
E&C Pulse - October 16th

In this edition, Ben DiPietro shares insights from his recent conversation with Roy Snell, outgoing leader ...


Subscribe To LRN's E&C Pulse Newsletter

First Name
Last Name
Company Name
Job Title
Thank you!
Error - something went wrong!