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HUMAN RESOURCES: THE GATEKEEPER FOR COMPANY ETHICS

Business ethics are important to every business and are often a component of a company’s core values. However, that doesn’t mean that the organization as a whole is ethical. To build an ethical organization, leadership must establish, and model the company’s core values. Ethics must be woven into the fabric of the organization, fully supported by leadership and integrated into the company’s philosophies, values, policies, procedures, and practices. HR departments represent the employees, their concerns, and deal with employee fairness issues. HR’s role in ethics management should be central to ensure real benefits for the organization and the employees. Human resources deal with a variety of ethical challenges that if not handled properly can damage a company’s reputation, lead to serious legal issues, and lead to a potentially high-cost impact to an organization. For example, discrimination issues, sexual harassment, and unfair employment policies can damage a company’s reputation as well as lead to a severe financial impact.

However, HR departments should not be expected to manage ethics initiatives on their own. In order for ethical behavior to become part of an organization, there needs to be a collaborative effort that also includes Legal, Audit, the top management team, and the board of directors. HR should have a primary role in the development and integration of ethics programs into key organizational activities, such as the design of performance appraisal systems, management training, and disciplinary processes.

The first step to include ethics in company policy and strategies is to put ethics on the agenda, make it part of the conversation. This can begin the process for ethics to become part of the organization’s culture, business plan, and goals. HR professionals can help leadership define ethics for the organization. For example, what are the specific types of ethical issues that impact your organization, your competitors, and your industry? This process of defining what ethics means to your organization can help determine safeguards that can be included in policies and processes such as recruiting, on-boarding, and leadership training. Ensure ethics policies are in place for issues such as discrimination, sexual harassment. and employee fair treatment. Establish and communicate expectations for your employees to ensure each employee understands their role. Communications surrounding ethics and other core values should be on-going. And of course, lead by example. HR professionals are in leadership roles and employees look to the leadership to guide their own behavior. Organization leaders need to set the example by engaging in legal and moral behaviors, and by showing their respect for the employees and for the organization. It is critical to creating a supportive environment of trust and transparency. Employees need to see fair treatment across all levels and need to trust in order to come forward regarding ethical concerns. Ethics panels can be created for the review of issues and violations.

Treating employees ethically can bring tremendous benefits to an organization. It can earn long-term employee trust and loyalty. Loyal employees gain more experience, and master processes, and become more vital to the success of the organization. Loyal employees are happier employees and can also translate into increased productivity and efficiency as well as minimize recruiting and training costs. Putting a Code of Ethics in place and encouraging leaders to model desired behaviors are important first steps toward creating an ethical organization. Holding ethics high as a core company value is key to a company’s success and longevity.

Having the appropriate employee fairness policies and processes in place is critical to maintaining an ethical organization. But it is equally important that these policies and processes are supported by fair and competitive compensation practices. For the good of your employees, it is helpful to analyze benefits survey data, compensation surveys, and salary reports. Having this information at hand allows you to plan a budget, including competitive employee salaries and benefits, which will help you to hire and retain a happy, talented team. At WageWatch, our consultants provide businesses with accurate and beneficial benefits survey data, compensation surveys, and salary reports to ensure that payment and benefits plans are on par with those in the industry. For more information on market compensation data, please call WageWatch at 888-330-9243 or contact us online (https://www.wagewatch.com/Contact/ContactUs.aspx).