Ethics
A. ETHICS
In this topic, learners should be able to:
Explain the code of ethics applicable to all parties in the financial environment
· Code of ethics
· Basic principles of ethics (leadership, discipline, transparency, accountability, fairness, sustainability, responsible management)
· Integrate ethics with other topics
a. Code of ethics:
· A Code of ethics is a statement of norms and beliefs of the business, describing acceptable behaviour in the work place.
· It makes it possible for every person involved in the business to know and understand what is considered right and wrong in specific situations.
· Most codes will value honesty, integrity and diversity.
b. Basic principles of ethics:
a) Leadership
Leadership is a position or state of being in control of a group of people or an organisation. A leader has to take control and people have to follow. Good leadership is visible when the followers obey the leader because they respect what the leader says and does
b) Discipline
Employees must work and behave in a controlled way and this involves obeying specific rules. The Code of ethics describes acceptable behaviour in the work place and consequences for incorrect behaviour. Employees who do not follow the Code of ethics will be disciplined
c) Transparency
Transparency means that behaviour must be such that it is clear that you have nothing to hide
d) Accountability
Being accountable means taking responsibility for what you say and do, and being able to justify your actions.
e) Fairness
Fairness is the quality of being reasonable and just. It means that you judge a situation objectively and without bias or any preconceived ideas. Customers or clients must feel that they are treated fairly
f) Sustainability
All businesses need to act in a way that shows respect towards the environment and the use of resources. Sustainability makes a difference in the long term. Businesses should not waste resources or damage the environment
g) Responsible management
Responsible management takes into account three important things, often called the 3 Ps (triple bottom line):
· People: A responsible manager considers all the stakeholders of the business – employees, suppliers and customers – and deals with them in an ethical way.
· Planet: A responsible manager takes the environment into account and does everything possible to ensure that the environment is looked after and not destroyed.
· Profit: A responsible manager ensures that the business makes the maximum profit, but only by using ethical practices