What role does a code of ethics play in an organization?

A code of ethics serves as a foundational document that provides guidelines for ethical behavior and decision-making within an organization. Its primary purpose is to establish a clear set of expectations regarding how employees should conduct themselves professionally and interact with others, both within and outside the organization. By doing so, it helps create a culture of integrity and accountability, guiding employees to make decisions aligned with the organization’s values and ethical standards.

Furthermore, a well-implemented code of ethics can help prevent unethical behavior by providing a reference point for evaluating actions and making choices in complex situations. It fosters a sense of responsibility among employees and encourages them to speak up in situations where unethical practices are identified.

In contrast to the other options, a code of ethics does not focus on determining employee bonuses, outlining marketing strategies, or focusing specifically on technological advancements. Instead, its core function is to shape the ethical climate of the organization, thereby positively influencing overall performance, reputation, and compliance with laws and regulations.