Embedding ethics into your organisation

14 May 19

As austerity measures, commercialisation and rapid change force local government into difficult decisions, a strong code of conduct becomes ever more important, CIPFA’s Kim Woods writes. 

Embedding Ethics illustration Natalie Wood

 

Ethics can often be viewed as something personal. In a sense, this is right, as ethics work to inform every-day decisions. However, ethics can apply far more broadly than individuals and the choices they face; rather, it can look to how organisations behave as a whole. This is particularly the case in the public sector, which has a responsibility to work for the greater good.

There are many clear incentives for public sector organisations to behave ethically as, when poor ethical choices are revealed, the fallout can be considerable, and the damage to an organisation’s reputation difficult to repair. It can mean a breach of trust with your employees, the partner organisations you work with, and with the public at large. But poor ethical choices still do happen.

On a certain level, this is unsurprising, as some people will always behave badly. But in a more general sense, maintaining the high ethical standards expected in the public sector has never been more challenging. We are experiencing a time of rapid change in local government, with pressures created by austerity measures, a growing wave of commercialisation and the trade-offs needing to be made by councillors and public servants all heightening the importance of ethics.

Broader societal changes are also creating new dilemmas. The rise of social media is creating new avenues to expose misconduct, be that bullying council members or other anti-social behaviours. There is also increased demand for decisions to be made at pace, creating a huge amount of pressure.

Interestingly, while incidents of misconduct are well recognised, there remains much debate on what ethics really means. During my workshops on ethics with managers from across the public sector, I’ve had countless such discussions. On a personal level, it can be about buying from certain brands, philosophies of life, or even ways of getting to work. Ethics means something very different for one individual versus another and, for organisations, this variance can be unhelpful.

Overcoming this challenge as an organisation means having a strong code of ethics in place. This sets professional standards and expectations of behaviour for everyone in the organisation and is essential. But for a code of ethics to begin to shape behaviour, it must be built on agreement and shared understanding.

This means getting the right support in your organisation for a code of ethics is crucial, as it cannot be a tickbox exercise. Rather, it must be applied to all aspects of your organisation’s conduct, including your strategies, stakeholder relationships and communications. So how do you achieve this in practice? Well, there are three tips that I would emphasise.

1. Lead from the top

The leadership team sets the tone for ethical values, behaviours and practices for the rest of the organisation. If there is poor ethical behaviour among leaders, this will undermine good ethical practices in the rest of the organisation. So it is important that the leadership team embodies the principles and behaviours to which it holds the rest of the organisation accountable.

2. Ensure everyone understands the organisation’s ethical principles

Good ethical practice is not something you just talk about or vaguely believe in – it is something you do. It’s important to ensure that you embed your ethical code into everything you do in your business – referring back to it in strategies, supporting people to get on board with aligned training, and backing it up with strong internal communications.

3. Build on mutual agreement

Make sure that you are not only speaking the same ethical language but that there is agreement that these principles are the right ones for your organisation. One useful approach is to ensure that you involve everyone in the organisation when discussing ethics, particularly when you are reviewing your code of ethics or your code of conduct.

Our survey carried out with Public Finance last year revealed that more than half of public sector accountants had been put under pressure or felt under pressure to behave in a professionally unethical way at least once in their career. With results as concerning as these, organisations should be paying attention and ensuring they embed strong ethical practices.

At CIPFA, we took note of the issues and updated our Standard of Professional Practice for our members. We were the first organisation to adopt these standards to align with the code of ethics set by the International Ethics Standards Board for Accountants. This is based on principles of integrity, objectivity, professional competence and due care, confidentiality and professional behaviour.

We also encourage organisations to make ethics part of their focus. The great thing about this is that you are not only doing the right thing but will also be boosting your organisation’s results, as strong ethics have been consistently linked to better organisational performance. Multiple studies from groups such as the Institute of Business Ethics have cited greater employee satisfaction, and even better financial results.

When it comes down to it, it is clear that regardless of type of organisation, having strong ethics is beneficial – and should be ingrained. For managers and executives in particular, it is important to support action with words, as ethical behaviour is a crucial aspect of leadership. Make sure you lead by example.

Keep an eye on CIPFA’s training page for upcoming courses on ethics, or contact the Alternative Service Delivery Network and ask for CIPFA ethics training on site.


Top tips…

Do

  1. Involve everyone in ethical discussions – agreement on principles is crucial
  2. Think big – embed the code in every business decision that is made
  3. Be aware of social media’s power to expose less than desirable behaviour

Don’t

  1. Just talk or think about it – do it
  2. Forget that managers must set the tone
  3. Lose sight of how the organisation behaves as a whole

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