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Implementation of CoC

Implementation of CoC

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Published by: isabelle on Nov 19, 2007
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ABSTRACT.More and more organisations formu-late a code of conduct in order to stimulate respon-sible behaviour among their members. Much time andenergy is usually spent fixing the content of the codebut many organisations get stuck in the challenge of implementing and maintaining the code. The codethen turns into nothing else than the notorious “paper in the drawer”, without achieving its aims. The chal-lenge of implementation is to utilize the dynamicswhich have emerged from the formulation of thecode. This will support a continuous process of reflec-tion on the central values and standards contained inthe code. This paper presents an assessment method,based on the EFQM model, which intends to supportthis implementation process.KEY WORDS: assessment method, business ethics,code of conduct, continuous improvement, learningorganisation, quality management, responsible organ-isation, self-evaluation
1. Introduction
During the last decade of the twentieth century,the debate around corporate social responsibility(CSR) seemed to intensify. The responsibilitiesof organisations are no longer addressed onlyby trade unions and environmental lobbies. Inparticular, “new” groupings such as employees,customers, managers, economists, shareholdersand public servants are taking up the subject
Measuring the Implementationof Codes of Conduct. AnAssessment Method Basedon a Process Approach of the Responsible Organisation
 Journal of Business Ethics
: 65–78, 2003.© 2003
Kluwer Academic Publishers. Printed in the Netherlands. André Nijhof is an assistant professor at the faculty of Business, Public Administration and Technology of the University of Twente, Enschede, the Netherlands.Stakeholder theory, ethics of care and organisational change management are important theoretical notions inhis research. Nijhof has published in journals like the International Journal of Value Based Management, Journal of Business Ethics and the Leadership and Organisation Development Journal, besides several pub-lications in Dutch books and journals. Next to the assignment at the University of Twente Nijhof is working at the management consultancy firm Q-Consult in Arnhem.Stephan Cludts is researcher at the Centre for Economicsand Ethics of the Catholic University of Leuven,Belgium. He defended a Ph.D. on employee participa-tion in which he blended notions of business ethics and human resources management. His research interestsextend to stakeholder theory, ethics of leadership and social capital.
 Andre Nijhof Stephan CludtsOlaf Fisscher  Albertus Laan
Olaf Fisscher is Professor of Quality Management and Business Ethics at the University of Twente in the Netherlands. His area of research focuses on responsible management in innovation processes. Fisscher is the author of many articles and books on organisational values, quality management and management of tech-nology and innovation, including “Social-dynamical aspects of quality management in NPD (2000)” and “The myth of self-managing teams; A reflection on the allocation of responsibility between individuals, teamsand the organisation (1999). Albertus Laan had recently finished his graduation thesison the implementation of codes of conduct. He is working on a Ph.D. about the responsabilisation of firms in the Dutch construction industry. He is especially interested in views on human morality and decision making. He has published an article on the responsible organisationin the journal Management & Organisatie 
of corporate social responsibility (CSR)(Donaldson, 1995). We have seen the emergenceof strategically operating NGOs, and the appear-ance of a European Green Paper promoting aEuropean framework for CSR. One facilitatingfactor of this development is the growing scaleof organisations, combined with the fading reg-ulatory function of government, with the con-sequence that the power of trade and industryhas increased. In reaction to their increasingpower, CSR appears to have become a broad-based societal and organisational development: atthe national and international levels we observea rapidly developing terminology from which, sofar, only a few definitions emerged as dominant.A plurality of moral conceptions, together withan increasingly diverse society and a growingmedia influence, makes it increasingly difficultfor organisations to predict from where criticismswill flow. This fosters the fast growth of thenumber of consultancy services being offered onsubjects such as transparency and communityinvestment. And partly as a result of these devel-opments we see a fast growing attention for theinternal organisation of business ethics; more andmore firms are handling (configurations of)ethical tools and instruments.Within the diverse set of management instru-ments for stimulating en monitoring responsiblebehaviour, codes of conduct seem to be one of the most widely adopted instruments. As a partof their CSR policy, 38% of the top one hundredorganisations in the Netherlands have drawn upa code of conduct. Sixty five percent of the topfive hundred organisations in Spain (Melé et al.,2000) and 50% of the largest companies inAustralia have adopted a code. The United Statesand Canada top the list with 78% and 85%respectively of the top 1000 organisations havingdrawn up a code of conduct (Kaptein et al.,2000). However, research in different countrieshas shown that, if an organisation really wantsto influence the behaviour of its staff, a corpo-rate code of conduct is not enough: there is nodirect relation between the fact that an organi-sation has a code of conduct and the levelof responsible behaviour within companies(Matthews Cash, 1987; Weller, 1988; N.B.E.S.,2000). That “document” has to be embedded inthe processes and culture of the organisation(McDonald and Nijhof, 1999). This need isaccentuated by the fact that the stakeholders havebecome increasingly sensitive to the differencebetween words and deeds (SER, 2001).
Defining codes of conduct 
Our assessment method focuses on the process of implementing a code instead of the outcomes of this process. A consequence of this is that we donot specify in our research what the contents of a code of conduct should be. After an organisa-tion has developed a code, our method can beused to assess the degree to which a code of conduct is embedded in the organisation.In our research we made certain assumptionsabout the use of a code and about generalsubjects addressed. Therefore, our assessmentmethod should be relevant to assess the embed-dedness of any of code which meets the fol-lowing assumptions:The code contains both open guidelinesabout desirable behaviour (value orienta-tion) and closed guidelines pointing at pro-hibited behaviour (compliance orientation);The code relates both to the behaviour of individual employees and to the collectivebehaviour of the organisation as a whole;The code indicates how responsibility isdistributed within the firm;The code is used as an instrumentenhancing corporate social responsibility.If these assumptions are not met completely byany particular code, some parts of our assessmentmethod will not be applicable.
Functions of a code of conduct 
Writing a code of conduct has undoubtedly theadvantage of setting managers to think about thecentral values of their company and to reflect onsituations in which these values are at stake.However, we consider CSR to acquire its sub-stance through the behaviour of people withinorganisations (Goodpaster, 1989). The managers66
 Andre Nijhof et al.
themselves represent only a tiny minority of thepeople who work for any given organisation.The implication of this view is that organisationsneed to embed “responsible entrepreneurship”not only into their business strategy and policy,but also into the organisational processes, theculture, and the daily matters.Therefore, when a code has been drafted, thefirst challenge is to trigger reflection on thecentral values proposed in the code among theemployees. In the second place, it is necessaryto link the reflection of managers and employeesin order to guide actual behaviour within theorganisation. For this to happen, the code of conduct should be embedded in the web of organisational processes and routines. For example, what could be the effect of a code of conduct if the whole management system wereoriented towards stimulating and rewarding shortterm financial gain? In order to be effective, acode of conduct requires a review of the man-agement system to make sure that employees areencouraged to work in congruence with thecode.Embedding the code of conduct can con-tribute to the emergence not only of responsibleindividual behaviour but also of a “responsibleorganisation”. The concept of a responsibleorganisation refers to the embeddedness of clearly defined and prioritised responsibilities inthe strategy and policy of an organisation. Theresponsibilities of an organisation can be fulfilledonly through the daily behaviour of its staff andmanagement, but an organisation needs to trans-late its CSR philosophy into supportive man-agement instruments and processes in order tobecome a “responsible organisation”. As it isable to attract managerial attention in this way,responsibility becomes an explicit managementcriterion, next to others such as efficiency, flex-ibility and quality (Fisscher et al., 2001).The assessment method focuses on the dif-ferent processes that are necessary, on the onehand, to stimulate reflection across all the layersof the organisation on the issues and responsi-bilities mentioned in a code of conduct, and onthe other hand to stimulate actual behaviour inaccordance with the code as it is understoodthrough the reflection process just mentioned.Within the structure and culture of an organisa-tion, many barriers to reflection and action exist.Defining these barriers and dealing with them isalso an important part of the assessment method.The different processes are operationalisedwithin a questionnaire to be used for self assess-ment by the organisation concerned. Our assess-ment method produces an overview of the extentto which the organisation actively manages theprocesses necessary for the implementation of acode of conduct. The identification of the dif-ferent processes and their operationalisation inthe assessment method is based on a literaturestudy and a comparison with other initiatives inthis field.
2. A process approach of codes of 2.conduct
A code of conduct is an instrument for respon-sibilisation within the organisation, but it isin itself not sufficient to shape a responsibleorganisation. In order to understand this, it isuseful to distinguish the different processes whichshape responsible behaviour within the organi-sation; we call them “processes of responsibilisa-tion”. Within the framework of the “InclusiveInnovation” research project, we distinguish sixprocesses of responsibilisation (see Figure 1): theprocess of coding, the process of internalisation,the process of identifying and removing barriers,the process of enacting values, the process of monitoring and the process of accountability.These processes have been defined in the firstplace on the basis of learning models such asthose developed by Kolb (1984) and Van der Bijet al. (2001). Their models include four broadlysimilar stages: (1) gathering information or expe-rience, (2) reflecting on that information or experience and comparing it with previousnorms or concepts, (3) developing of new normsor concepts and (4) experimenting with thesenew norms or concepts. Stage four generates newinformation or experience, which leads thelearning person or organisation to start with anew learning cycle. In our scheme, an organisa-tion goes through these four stages by theprocesses of coding (stage 1), identifying and
Measuring the Implementation of Codes of Conduct 

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