What is an Ethics Policy?

Malcolm Tatum
Malcolm Tatum

Also known as a code of ethics, an ethics policy is a document that defines the essentials of how people within an organization will interact with one another, as well as how they will interact with any customers or clients they serve. A corporate ethics policy will also often address how employees are to interact with vendors and others who supply goods and services to the company. Because the scope of situations involving human interaction is so broad, a well-crafted policy of this type will include general principles as well as identify the more common situations that are likely to occur.

Sexual harassment is often addressed by workplace ethics policy.
Sexual harassment is often addressed by workplace ethics policy.

While the exact nature of an ethics policy will vary from one situation to another, there are some basic elements that appear in just about any code of ethics. Many of these have to do with the basics of how employees will interact with one another during working hours. Here, the company will establish guidelines that help to ensure that each employee is treated with respect, and can feel safe while in the workplace. Increasingly, companies specifically address issues such as sexual harassment, inappropriate verbiage, and fraternization on the job as part of the basic workplace ethics.

Inappropriate verbiage is often addressed by workplace ethics policy.
Inappropriate verbiage is often addressed by workplace ethics policy.

Another common element in an ethics policy has to do with confidentiality. This can include making sure that any data considered to be proprietary is not shared with unauthorized individuals, in or out of the organization. Proprietary information may include personal data regarding the contents of personnel records, upcoming marketing strategies, or financial data of any kind.

It is not unusual for an ethics policy to address how employees can properly interact with suppliers and customers. Many businesses today do not allow employees to accept gifts from customers or suppliers, with some going as far as not allowing employees to permit suppliers to pay for a meal. The idea behind this approach is to make sure there is no opportunity for undue influence that would impair the ability of the employee to make decisions that are in the best interests of the company.

Many policies will also address the issue of possible conflicts of interest. This may include taking a second job with a competitor, or having some type of financial interest in an organization that is considered a business rival. Often, these provisions are somewhat specific, and will offer examples of what type of connections with other entities is considered acceptable, and which ones are considered inappropriate.

Other provisions will be based on prevailing standards related to the nature of the organization itself. There will be some aspects that are found in a medical ethics policy that may be missing from a political ethics policy, just as some concepts of personal ethics found in policies drafted for non-profit entities will not be found in a corporate ethics document. Since the purpose of the policy is to make sure that the entity and those connected with it abide by standards that are both legal and ethical, close scrutiny and occasional revision is often a good idea. This will allow the policy to remain relevant even as new situations arise with increasing frequency, or there is a shift in the laws that apply in the jurisdiction where the entity is established.

An ethics policy might tackle issues such as office rumors.
An ethics policy might tackle issues such as office rumors.
Malcolm Tatum
Malcolm Tatum

After many years in the teleconferencing industry, Michael decided to embrace his passion for trivia, research, and writing by becoming a full-time freelance writer. Since then, he has contributed articles to a variety of print and online publications, including wiseGEEK, and his work has also appeared in poetry collections, devotional anthologies, and several newspapers. Malcolm’s other interests include collecting vinyl records, minor league baseball, and cycling.

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Discussion Comments



True, there is a lot of sad and shady business practice, but that should not excuse people from working hard in an honest and moral manner in the workplace. Otherwise, one bad leader would trigger a lot of dishonest workers.



Although codes of conduct do require leaders to follow their own rules, this is rarely recognized, and bosses like to milk their power. I have noticed that people who get paid more often tend to work less than everybody else. Perhaps money isn't so much a matter of adhering to a code as it is being obsequious to the powers that be.


Code of conduct in business is an essential way for leaders to put forward ways in which they will establish an ethics policy. Leaders who establish rules and then fail to follow them are deemed hypocrites, and are difficult to follow, especially in the day-to-day setting of the workplace. The role of ethics in business is essential to the structure of a company as a whole.


Ethics are standards which are to always be taken into account when functioning in a people group. In order to effectively coexist with this people group, one must recognize that these are the standards that everyone holds to and operates by. If you do not have some level of conformity to the context of a culture you can't perform in it.

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