Managing the money that comes into and goes out of your company is hard enough to keep track of without also dealing with illegal or immoral behavior. Few things are as ripe for unethical behavior as your company's budget, especially in an organization that does not prize ethical principles. Whether it's preventing outright theft or dishonest accounting, budgetary ethics are required in any organization. Instilling them in your company requires education, preparation and a willingness to back up the rules with consequences.

Planning Ahead

Often, some of the biggest ethical budget dilemmas can be avoided simply by planning ahead. Keeping an extensive list of budget objectives and obstacles at hand can give you an idea what types of problems you will be facing down the line. By planning for good times and bad, and keeping capital on hand for your business' rainy days, you won't be tempted to cut budget corners later and do things that might be considered unethical.

Ethics and Compliance Programs

Many companies employ ethics and compliance officers to keep their operations honest. Hiring these professionals and creating departments in charge of keeping your budget and financial procedures honest sends a message to employees, managers and stockholders that ethical budgetary operations are how the company does business. Establishing this sort of ethical corporate culture and enforcing it can prevent fraud, dishonest accounting and other instances of financial malfeasance.

Train Employees to Handle Money Responsibly

While many cases of unethical budgetary behavior result from greed or ill intent, some occur because of a lack of education. Employees may be performing actions with your company's money that they don't even know are unethical or illegal. And if caught breaking the law or ethical rules, a lack of education is no excuse. Make ethics training for employees mandatory. Teach employees exactly what is expected of them and what types of actions are unethical or illegal. Also make clear to them that failure to follow these ethical guidelines will result in strict punishment. One way to do this is by having employees sign an agreement.

Dealing with Unethical Behavior

No matter how hard you try to implement ethical budgetary procedures in your company, there's no guarantee that someone won't attempt to engage in unethical behavior. When an ethical lapse occurs, identify it and deal with it quickly. While other employees may not have any desire to take part in unethical behavior, seeing rules go unenforced undermines your efforts to institute ethical budgetary procedures. Employees who violate ethical rules must be disciplined, regardless of rank or status within the company.