Journal of Business Ethics 58 (1-3):79-100 (2005)
Abstract |
. Recent corporate scandals have focused the attention of a broad set of constituencies on reforming corporate governance. Boards of directors play a leading role in corporate governance and any significant reforms must encompass their role. To date, most reform proposals have targeted the legal, rather than the ethical obligations of directors. Legal reforms without proper attention to ethical obligations will likely prove ineffectual. The ethical role of directors is critical. Directors have overall responsibility for the ethics and compliance programs of the corporation. The tone at the top that they set by example and action is central to the overall ethical environment of their firms. This role is reinforced by their legal responsibilities to provide oversight of the financial performance of the firm. Underlying this analysis is the critical assumption that ethical behavior, especially on the part of corporate leaders, leads to the best long-term interests of the corporation. We describe key components of a framework for a code of ethics for corporate boards and individual directors. The proposed code framework is based on six universal core ethical values: (1) honesty; (2) integrity; (3) loyalty; (4) responsibility; (5) fairness; and (6) citizenship. The paper concludes by suggesting critical issues that need to be dealt with in firm-based codes of ethics for directors.
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Keywords | Boards of directors ethics law codes corporate governance |
Categories | (categorize this paper) |
DOI | 10.1007/s10551-005-1390-y |
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References found in this work BETA
Managing Ethics in Business Organizations: Social Scientific Perspectives.Linda Klebe Treviño - 2003 - Stanford Business Books.
A Code of Ethics for Corporatecode of Ethics.Mark S. Schwartz - 2002 - Journal of Business Ethics 41 (1-2):27 - 43.
Ethics in American Companies: A Managerial Perspective. [REVIEW]Barry Z. Posner & Warren H. Schmidt - 1987 - Journal of Business Ethics 6 (5):383 - 391.
"I Didn't Know" and "I Was Only Doing My Job": Has Corporate Governance Careened Out of Control? A Case Study of Enron's Information Myopia. [REVIEW]John Alan Cohan - 2002 - Journal of Business Ethics 40 (3):275 - 299.
Ethics From the Top: Top Management and Ethical Business.Doris Schroeder - 2002 - Business Ethics 11 (3):260–267.
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Citations of this work BETA
Corporate Ethical Codes: Effective Instruments For Influencing Behavior.Betsy Stevens - 2008 - Journal of Business Ethics 78 (4):601-609.
Culture Follows Design: Code Design as an Antecedent of the Ethical Culture.Thomas Stöber, Peter Kotzian & Barbara E. Weißenberger - 2019 - Business Ethics: A European Review 28 (1):112-128.
The Anatomy of Corporate Fraud: A Comparative Analysis of High Profile American and European Corporate Scandals.Bahram Soltani - 2014 - Journal of Business Ethics 120 (2):251-274.
Women and Employee-Elected Board Members, and Their Contributions to Board Control Tasks.Morten Huse, Sabina Tacheva Nielsen & Inger Marie Hagen - 2009 - Journal of Business Ethics 89 (4):581-597.
Is Environmental Governance Substantive or Symbolic? An Empirical Investigation.Michelle Rodrigue, Michel Magnan & Charles H. Cho - 2013 - Journal of Business Ethics 114 (1):107-129.
View all 49 citations / Add more citations
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