Skip to content

ACCA Applied Knowledge · Business and Technology · Corporate codes of ethics

A company has published a code of ethics but managers never refer to it, no training is given and nobody is disciplined for breaches. What is the most likely consequence?

The code will probably be seen as a mere statement of intent with little effect on behaviour. Codes work only when supported by management example, training, communication and consistent enforcement. Publication alone does not change conduct, and codes are not automatically enforced by courts.

  1. AThe code will be treated as a statement of intent only and will have little effect on behaviourCorrect
  2. BThe code will automatically be enforced by the courts as a contract with shareholders
  3. CThe code will improve behaviour because it has been published

Explanation

A code only influences behaviour if it is embedded through leadership example, training and enforcement. Without these it becomes window dressing. Publication alone does not change conduct, and codes are not automatically enforceable by courts.

Did you get it right without looking?

One question tells you little. A timed set on Corporate codes of ethics shows your real accuracy, how long you take and where you lose marks.

Practise Corporate codes of ethicsFree diagnostic mock

More Corporate codes of ethics questions