A business code of ethics is a set of rules or moral guidelines that define and govern principles and actions in an organizational environment. Ethical behavior is beneficial for everyone because it protects the interests of the company or organization and the interests of everyone who comes into contact with the organization. Rules in daily life tend to help people to stay more focused on what the right course of action is for common situations, and a code of ethics accomplishes the same thing in those situations where black and white moral judgments may not entirely apply. Some actions may not be considered immoral, but may still be classified as unethical because they damage the interests of all parties affected by the actions.

Mutual Respect and Integrity

A code of ethics promotes an environment of respect based on integrity. When people know the code of ethics and follow it, this creates an atmosphere of trust, respect and confidence in the actions of each person involved in the organization or group. In the presence of a written code of ethics, employees at a company, for instance, are expected to behave a certain way toward each other and toward customers. The practical result of this is a more peaceful atmosphere in which to work, and one that is free of such widespread problems as work-based sexual harassment, violence and other forms of misconduct. A code of ethics is only effective in this way when group members are confident that the rules will be enforced.

Codes of ethics are usually found only in businesses and similar entities such as non-profit organizations; but individuals can make use of a definite code of ethics as well. Visibly living by a specific ethical code will help you to gain respect from anyone you come in contact with. One of the most common of such personal ethical codes is, "Treat others as you would like to be treated yourself." Consistent observance of such a simple idea is a first step towards living an ethical life.

Trust and Honesty

Another benefit of a code of ethics is trust. Rules promote trust, especially when they are followed consistently. When there is a breach in the code of ethics, the problem is dealt with and employees can learn something from the violation. A code of ethics should allow room for individual improvement and learning to better understand the code, but each person should try to do their best to follow the guidelines.

All employees, whether management or mail room, who take the code of ethics seriously, gain the trust of their fellow employees. Those who work for the organization know that they will be protected in any situation. As long as everyone works and behaves in an ethical manner, production can run more smoothly, whether that be production of a tangible product or production of the services and ideals of an altruistic non-profit.


Responsibility is a third major benefit of a code of ethics. When people take responsibility for their actions, everyone benefits. Responsibility is accountability and honesty, and holding yourself accountable promotes these good character traits in others who see them in you. This helps to create a cohesive and productive work force, which has several of its own benefits, not the least of which is longer employee retention. Employees are more likely to continue to working for a company that follows and promotes rules that protect and benefit everyone equally.