ETHICS CORPORATE GOVERNANCE
Singapore – Companies in Asia have to apply the same awareness to ethics compliance as they do to safety in order for employees to be conscious of the company’s moral guidelines.
Conrad P. Schmidt, global research officer at the Corporate Executive Board (CEB), said companies that have made “huge strides in safety” were those that placed an importance on safe workplaces. He added many of these companies included safety briefings in their daily or weekly meetings, and kept safety consciousness at the top of their corporate agenda.
“If companies can have similar regular conversations about ethics with their employees, it will really drive up awareness and understanding,” Schmidt said.
According to CEB, ethical behaviour is about how employees interact responsibly with co-workers and clients. Joel Whitaker, head of research for CEB in Asia Pacific, added corporate ethics includes how the organisation manages its intellectual property.
Schmidt said many companies would create guidelines and have employees attend governance training, but fail to follow up or have regular updates with them. According to him, the best way to communicate corporate ethics to staff is getting them to understand how misconduct can manifest in their daily work.
“There has to be constant communication and reinforcement,” Schmidt said.
Schmidt added that it is important leaders do not sweep misconduct under the carpet so employees have a clearer understanding of what constitute an ethical breach.
Bosses also play a key role in relaying the company’s corporate governance policy as the latest research by CEB showed they are 71% of Asian employees’ preferred channel in reporting misconduct.
Schmidt said once managers understand the link between ethics compliance and business goals, they will be more empowered to educate employees on the importance of corporate governance.
Yet Asia has a high number of employees who are hesitant to step forward and report an ethical breach as they fear backlash from the company. Only 46% of Asians would report misconduct, far lower than the global average of 58%.
Schmidt said some employees do feel that their organisation will not take action even if they speak up. He suggested that companies need to show they can, and will act, on compliance issues. While legal issues can put a limit to communication, informing staff that someone has been removed from their role due to misconduct can be a very powerful message, he added.
“Employees either need to know scenarios, or there needs to be a constant conversation around what results from an ethical compliance gap,” he said.
However, companies have to tailor their communication strategy to the local markets they operate in to ensure that guidelines are not lost in translation. Whitaker said it is critical for employers to be aware of differences in cultures and business norms, especially when adapting Western governance for Asian offices.
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