Building an ethical culture means establishing a system of principles and values that guide behavior within the company, influencing everything from daily interactions to long-term strategies. It is important to emphasize that an ethical culture is not merely a matter of compliance, but a framework that directs decisions, behavior, and corporate identity—directly impacting your image, stakeholder relationships, and sustainability.
For everyone to clearly understand what is right or wrong within an organization, it is essential to implement an ethical culture. This culture will define the norms that guide business practices for employees, as well as for partners, suppliers, and external stakeholders. In this article, we explore the fundamentals of ethical culture, the processes necessary for its implementation, and the benefits it offers—both in strengthening internal governance and in positioning the organization externally.
What Is Organizational Ethical Culture?
Organizational ethical culture consists of the set of principles and values that guide decisions and actions within a company, covering both internal activities and the projects and services associated with the organization. Unlike general organizational culture—which is built day by day by employees—organizational ethics is defined more formally by senior management or corporate governance, reflecting an objective set of guidelines that steer the company’s behavior and practices.
Steps to Implement an Organizational Ethical Culture
The first step is the commitment of top management to adopt an ethical culture. Once this decision is made, it is essential to communicate the intention clearly throughout the organization, creating an environment conducive to the adoption of new practices.
Communication should not be limited to directives from senior management to operational managers. Ongoing dialogue with operational areas is necessary to integrate the ethical culture gradually and effectively throughout the organization.
Another important issue is to evaluate whether the organization already has a code of conduct in place or if a new one needs to be created. Remember that the code should reflect the company’s fundamental ethical principles, serving as the backbone of its ethical culture.
After developing the code of ethics, the company must invest in internal communication campaigns so that all employees are aware of and committed to the new ethical standards. Simply publishing the code is not enough—it must be continuously reinforced.
Ideally, an Ethics and Regulatory Compliance Manager should lead the process. If the organization does not have this position, the responsibility can be delegated to the Board, the Compliance department, or the Legal Department.
Internal Benefits of an Organizational Ethical Culture
- The organization will have well-defined guidelines regarding roles and objectives, resulting in a more structured work environment.
- With a code of ethics in place, the company can address violations more objectively, responding to detrimental actions by employees in a fair and transparent manner.
- Adopting an ethical culture strengthens employees’ sense of belonging by aligning their personal interests with those of the organization.
- In the long term, implementing an ethical culture leads to greater profitability, as every department works efficiently and ethically toward achieving the organization’s goals.
External Benefits of an Organizational Ethical Culture
- With a consolidated ethical culture, employees are better prepared to identify and mitigate legal, financial, or operational risks in relationships with suppliers, customers, and other stakeholders, particularly regarding anti-corruption issues.
- Companies with a robust code of ethics demonstrate their commitment to good governance practices, gaining legitimacy in the eyes of regulators and government authorities.
- A well-implemented ethical culture improves the company’s reputation not only internally but also in the market, strengthening its relationships with customers, suppliers, and the community at large.
Metrics to Evaluate Organizational Ethical Culture
Consider some of the most relevant metrics to assess organizational ethical culture:
- Achievement of Organizational Objectives: Monitor financial results and ensure that the activities carried out align with the established ethical principles.
- Organizational Climate Surveys: Conduct periodic surveys to measure the impact of ethical culture on the work environment and understand how employees perceive the company’s values.
- Risk Matrix: Implement a risk matrix to evaluate various parameters and enable preventive analysis in case of failures or alerts related to unmet metrics.
Remember, monitoring the results is the surest way to develop a solid ethical culture, yielding long-lasting benefits both internally and externally.
