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More About This Title The Business Ethics Twin-Track - CombiningControls and Culture to Minimise Reputational Risk
English
The Business Ethics Twin-Track is a practical guide to reputational risk management. A deep exploration of the concept of reputation, the ways in which it can suffer, and the consequences when it does, the book outlines an ethics controls framework that can mitigate risk and improve business performance. Readers will learn how to identify and manage weaknesses, and how to institute a system of governance that embeds proper, ethical conduct into the corporate culture. A clear set of controls and procedures provides actionable instruction that can be customised to suit the organisational structure, and discussion of historical and international ethics provides the context for implementation. Case studies illustrate the real-world applications, while interviews with executives from a variety of sectors provide important practical insights into some of the key issues discussed in the book.
The law regulates behaviour in health and safety and financial crime, but otherwise, conduct is largely determined by the culture, ethics and values of an organisation. Effective reputation management is complex, and often difficult to achieve, as much of the available information on the topic is more theoretical than practical. This book bridges the gap by providing the tools that will help managers to:
- Implement a modern ethics control framework, encompassing codes, officers, reporting lines and training
- Consider the role of the media and social media in reputational damage to individuals and organisations
- Analyse the key controls in responsibility and governance frameworks from around the world
- Determine the causes and controls of conduct risk, including incompetence, negligence and criminality
Today's fast-paced media environment means corporate reputations can be obliterated in moments, and damage limitation is often too little, too late. Adopting the measures set out in this book will embed ethics into the culture, and match people's behaviours to the organisation's values.
English
STEVE GILES is a chartered accountant with over 20 years' experience of advising directors on business issues concerning governance, risk and compliance. After leaving Deloitte in 1997, Steve has set up and run two companies and has worked with directors and senior managers in the UK, Continental Europe, and the US to achieve successful solutions to a variety of business problems resulting from corruption, inappropriate conduct, incompetence or negligence. Now an independent consultant, he continues to advise his clients but also speaks extensively around the world on corporate governance, risk management and business ethics. Steve holds an MA from Christ Church Oxford, is an Associate Member of the Institute of Chartered Accountants in England and Wales, has been a Visiting Lecturer at the University of Hertfordshire and is the author of Managing Fraud Risk: A Practical Guide for Directors and Managers published in 2012 by John Wiley & Sons.
English
Acknowledgements xv
Prologue xvii
Opening xvii
Corporate values: an old story xvii
The ‘say-do’ gap xviii
About The Book xviii
Original idea xviii
2012 effect xix
Structure and methodology xx
My Experience xxii
Audit, risk and forensics xxii
Governance xxii
Business ethics xxiii
Speaking and writing xxiii
The Book: Key Messages xxiv
Overarching principles xxiv
Twin-track approach xxiv
Role of compliance xxv
Reference points xxvi
Summary xxvii
Personal perspectives xxvii
Road test xxviii
‘Simply the way we do things here’ xxx
Closing xxx
Value statements: a modern story xxx
Chapter 1: The ethics project
The Opportunity 1
Initial contact 1
Coaching session 2
An unexpected request 3
Hot talk, cold chicken 4
The Stronach Group Plc 6
Background research 6
Corruption allegations 8
Recent trading difficulties 9
The board of directors 10
An Offer From The Chairman 12
The meeting 12
Strategic review 13
The ethics project 16
Key takeaways 17
Disclaimer 18
Chapter 2: The business ethics framework
The Ethics Project: First Workshop 19
Opening 19
The ground rules 20
Personal approach to business ethics 20
Agenda 22
Key questions 22
The Business Ethics Framework 23
Overview 23
Purpose 24
Mission statements and value statements 26
Responsibilities of directors 27
Pragmatic approach 29
Key Terms 32
Ethics 32
Business ethics 33
The golden rule 35
Integrity 37
Trust 40
The law 43
Compliance 46
Corporate culture 48
Business Dilemmas 49
Setting the scene 49
Ethical dilemmas 50
Business dilemmas 51
Workshop Conclusion 53
Closing 53
Key takeaways 54
Next workshop 55
Reflections 55
Chapter 3: Bribery, corruption and adequate procedures
Business Ethics in Action: Second Workshop 57
Opening 57
Agenda 58
A business dilemma 58
Bribery and Corruption 59
Overview 59
Bribery and corruption in business 62
Examples of anti-corruption laws and conventions 63
Case Study 65
The Siemens corruption case part 1: scandal and penalties 65
The Bribery Act 2010 (UKBA) 70
Background 70
Summary of the UKBA offences 72
The other main provisions 73
Adequate procedures 74
Official guidance on adequate procedures 76
Caution: beware of paying lip-service 80
Personal Experiences 82
Introduction 82
Example 1: UK subsidiary of a global energy group 83
Actions 84
Example 2: medium-sized UK business in the defence industry 85
Workshop Conclusion 87
Closing: bribery dilemma 87
Key takeaways 88
Next workshop 89
Reflections 89
Chapter 4: Reputation, risk and conduct
Reputational Risk: Third Workshop 91
Opening 91
Agenda 91
Risk 92
Risk awareness quiz 92
Reputation 96
Reputation and brand 96
Consequences of damaged reputation 99
The Human Factor: People, Behaviour and Conduct Risk 103
Overview 103
The concept of conduct risk 104
People Risk 106
Introduction 106
Incompetence 107
Criminality and counter-productive workplace behaviours 108
Lack of engagement, complacency and negligence 111
‘Custom and practice’ 113
Case Study 115
The Siemens corruption case part 2: remedial actions to rebuild trust and reputation 115
Case study: conclusion 118
Ethical Risk in the Stakeholder Base 119
Overview 119
Key stakeholder expectations 119
Importance of stakeholder experience 123
Workshop Conclusion 126
Closing 126
Key takeaways 126
Next workshop 127
Reflections 127
Chapter 5: The governance dimension
Effective Governance: Fourth Workshop 129
Opening 129
Governance soundings 130
Agenda 131
Importance of corporate governance 132
Why Good Governance Matters 132
Overview 132
Two governance examples 133
Governance case study one: Manchester United 133
Corporate Governance Overview 137
Definitions 137
Board composition, relationships and agency risk 138
The Development of Corporate Governance Codes and Legislation 141
Rules-based and principles-based regimes 141
The US Position 142
The Sarbanes–Oxley Act 2002 142
The Fraud Enforcement and Recovery Act 2009 145
The Dodd–Frank Wall Street Reform and Consumer Protection Act 2010 146
Conclusion 147
The UK Position 147
The UK Corporate Governance Code 147
Creating an Effective and Talented Board 149
Overview 149
Board compliance: the key processes 149
Board performance: the key improvement drivers 154
Workshop Conclusion 161
Closing 161
Key takeaways 161
Next workshop 162
Reflections 162
Chapter 6: Aspects of leadership: ethics, tone at the top and handling a crisis
Ethical Leadership: Fifth Workshop 165
Opening 165
Agenda 166
A business dilemma 166
Leadership 167
Two examples: theory 167
Another example: practice 168
Summary 169
The Components of Ethical Leadership 169
Overview 169
The ethical person 169
Case study two: the Co-operative 173
The ethical manager 180
Ethical leadership in action: the Westpac banking corporation 181
Handling a Crisis 190
Background 190
The impact of digitisation and social media 192
The leader’s role in a crisis 195
Workshop Conclusion 197
Closing 197
Key takeaways 197
Business dilemma 198
Next workshop 198
Reflections 199
Chapter 7: Risk, compliance and the controls framework
A Three-Stage Process: Sixth Workshop 201
Opening 201
Agenda 202
Risk Management 202
Background 202
Risk management models 204
Compliance and Controls 206
Overview 206
Compliance 207
Internal controls 209
Controls in action: anti-fraud measures 212
Internal Audit 215
Overview 215
Workshop Conclusion 218
Closing 218
Key takeaways 218
Next workshop 219
Reflections 220
Chapter 8: The business ethics toolbox
Ethical Development: Seventh Workshop 221
Opening 221
Agenda 223
Corporate Social Responsibility (CSR) 223
Background 223
CSR in action 225
Pay, Bonuses and the Balanced Scorecard 227
Observations 227
The balanced scorecard 229
The governance dimension 230
The Business Ethics Toolbox 231
Overview 231
Value statements 231
Codes of ethics and/or conduct 235
Confidential reporting lines 239
Ethical Training and Development Programmes 239
Framework 239
The training market: an overview 241
Training and development: general principles and observations 242
Training in business ethics 246
Examples of training exercises 250
Workshop Conclusion 254
Closing 254
Key takeaways 254
Next workshop 255
Reflections 255
Chapter 9: Whistle-blowing: encouraging a culture of openness
Creating an Open Culture: Eighth Workshop 257
Opening 257
Agenda 259
Introduction and Background to Whistle-Blowing 259
Definitions 259
Background 261
Issues and Controversies 262
Examples of whistle-blowing cases 262
Key issues arising: why report externally? 264
Whistle-blowing controversies 265
Scepticism and fear in the workplace 267
The Law as it Applies to Whistle-Blowing 268
Overview 268
Different approaches 269
The EU 269
The UK: The Public Interest Disclosure Act (PIDA) 270
The USA 271
Whistle-Blowing in Action 272
Introduction 272
Personal experience 273
The ethics officer 275
The 10 Steps 277
How to implement an effective whistle-blowing process 277
Workshop Conclusion 281
Closing 281
Key takeaways 282
Next workshop 282
Reflections 283
Epilogue 285
Another Surprise 285
Notes 287
Index 295
