Ethics

Implementing the Code

Coverage

All levels of employees and Directors

Common Legal/ethical issue from the organisation

Specific examples

Include duty to act honestly, fairly and integrity

Style

Plain personal Language

Positive tone - What should be done, not what should not be done

User-friendly

Enforcement

Give checklist, prescribed steps, questions to ask oneself before making decision

Training

Contact person if in doubt

Make code part of employment contract

Make part of duty to whistleblow

Specify disciplinary actions

Board endorsement and circulation

Publicise

Sets the value of the company

Wrong tone - governance mechanism will fail

Controlling SH, chairman or CEO is always involved in major scandal

Tone effectiveness

Comprehensive Code

Implement

Monitor

Enforce

Exec done wrong did not face sanctions

Reasons

Hard to prove

Legal sanctions is limited (Asia)

Exec is the key person in handling a certain thing

Makes it hard to raise ethical and governance standard

Individuals

Must take responsibility for doing the right thing

Companies

Imposing a minimal standard on

Employees

Business partners

Suppliers

Regulators

Taking Legal Action and Set the tone

E.g.

SOX - comply or explain on code of ethics of the company applying to Sr financial officers

NYSE - Code of buisness conduct and ethics to be disclosed, if waived, must be disclosed

Code of conduct made publicly available

Investors

Do not be overly obsessed with Short-term performance

Law

Protection

SOX

Against prejudicial treatment of WBer

Prohibit retaliation on WBer, fine/imprisonment

UK Public interest Disclosure Act

Only qualifying disclosures

Criminal Offence

Breach of legal Obligation

Miscarriage of justice

Danger to health/safety

Damage to environment

Deliberate cover up for the above

Disclosure are protected if reported to

employer via internal procedure

Prescribed person

Legal Adviser

Minister

Disclosures that are auto-protected

About Serious Failures

Health and Safety matters

Mandatory whistleblowing

SOX

All attorneys are mandatory whistleblowers

Treatment to complaints

SOX

Establish rules for complaint treatment

Treat anonymous complaints

Rewards

Code of governance

Arrangement for staff to raise concnerns on possible improperties in confidence

Arrangement for independent investigation and appropriate follow up action

Implementation

Building a Culture of Trust and Openness

Anonymity

Should allow this eventhough it will be harder to investigate

Should give assurance in the policy that confidentiality matters

WBer

Employees

Contract workers

Vendors

Customers

Member of Public

WBee

Internal

Line Manager

Less independent

CEO/CFO

HR head

HR of Internal Audit

Company Secretary/Legal Counsel

Designated ethics officer

AC/ AC Chairman

Should be kept informed of complaints and investigation

Should be one of the persons to disclose to

External

Company Appointed WBer Service provider

Ethics Hotline

Company appointed outside lawyer

External/outsourced internal auditor

Qualifying Discloure

Only serious concerns having large potential impact

Wrong Financial Reporting

Unlawful

Serious improper conduct

Follow up

Investigation should start after report has been made (documented)

Reveal who will be informed to proceed with follow up

Update WBer, Board, AC the progress

Include that WBer, if involved in fraud, does not lessen guilt but will be considered

Develop procedures for investigatng compalints

Protection

Psychological Welfare - who can he talk to if he feels he has suffered a detriment

Confidentiality - State that identiy will be protected

Victimisation of WB will face disciplinary action

However, malicious allegations may result in disciplinary action, unless in good faith

Code of conduct/ethics to guide employees out of dilemmas

Avenues to report breach of code of ethics/conduct