Business Conduct Guidelines

The Ethics Officer Association (EOA) is a professional association for managers of ethics, compliance, and business conduct programs. It was founded in 1992 by a dozen ethics officers and today has over 800 members, including ethics officers from more than half of the Fortune 100.

In addition, EOA membership includes non-profits, municipalities, and other organizations, including: the American Cancer Society, the Australia Department of Defense, the City of New York, the New York Stock Exchange, and the Securities Industry Association.

The EOA has been exploring the feasibility of developing a global business conduct management system standard through the ISO process. ANSI has approved the EOA proposal for the development of a guidelines standard along the lines of ISO 9004 and ISO 14004. The business conduct management system standard would be a single set of voluntary, internationally recognized guidelines and tools to manage organizational ethics, compliance, and business conduct programs.

The guidelines document would standardize the management of organizational ethics, compliance, and business conduct programs by providing guidance on the design and use of a business conduct management system within an organization. It also would provide guidance on a wide range of objectives of a business conduct management system with the goal of contributing to continual improvement of an organization’s overall performance and the effectiveness of its business conduct program.

The standard would define business conduct and would include the means to measure and credibly demonstrate compliance with the standard. The ISO management system standard could be a tool for any organization to use as a benchmark in measuring and demonstrating the effectiveness of its business conduct program and/or as a standard for business partners to meet. The standard would allow for self-declaration and would not be intended for use as a specification standard for certification, registration, or contractual purposes, or for the establishment of any other business conduct management system conformance requirements.

EOA points out that ISO Guide 72, Guidelines for the Justification and Development of Management System Standards, sets forth the following themes and elements that are common to all ISO Management System Standards:

    1. Policy (demonstration of commitment and principles for action)
    2. Planning (identification of needs, resources, structure, responsibilities, etc.)
    3. Implementation and operation (awareness building and training, etc.)
    4. Performance assessment (monitoring and measuring, handling nonconformities, audits)
    5. Improvement (corrective and preventive action, continual improvement)
    6. Management review

According to the EOA, existing effective business conduct programs typically have the following elements, which are included in the U.S. Sentencing Commission’s Federal Organizational Sentencing Guidelines and would be a reasonable starting point for the BCMS:

  • Compliance standards and procedures
  • Oversight by high-level personnel
  • Due care in delegating substantial discretionary authority
  • Effective communication of standards and procedures to all levels of employees and other agents, e.g., through required training or clear and practical publications
  • Reasonable steps to achieve compliance with standards, including systems for monitoring, auditing, and reporting suspected wrongdoing without fear of retribution
  • Consistent enforcement of compliance standards including disciplinary mechanisms
  • Reasonable steps to respond to and prevent further similar offenses upon detection of a violation

For more information, see the EOA web site at: <http://www.eoa.org>.