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

Which of the following is a limitation of relying on a corporate code of ethics alone to promote ethical behaviour?

A limitation of relying on a code alone is that employees may follow the letter of its wording without embracing its spirit, so ethical behaviour depends on culture and enforcement, not just on a written document.

  1. AEmployees may comply only with the wording and not the spirit of the codeCorrect
  2. BIt always increases staff turnover
  3. CIt prevents the company from setting performance targets
  4. DIt must be approved by the stock exchange before use

Explanation

A code can lead to box-ticking, where people follow the letter but not the intent, especially if it is not embedded in culture. The other statements are not general features or limitations of codes.

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