The LRN ethics and compliance was based on three issues; avoidance of breaking the criminal law at work, avoidance of actions that may result to civil suits and avoidance of actions that may ruin the image of the business. The concepts have a significant effect on daily activities of the employees, company reputation and the overall revenue generated (Cornelius, 2009). Anytime an employee strays from the code of ethics, the business stands a chance of financial disaster since its public image is ruined, and most of the customers would not like to be associated with such risk.
Maintenance of a cultural code of ethics is crucial in defining a business. A business that keeps changing its ethical routine lacks compliance from suppliers, employees and the overall management (Brenkert and Beauchamp, 2010). There lacks sustainability on the required ethics. Lack of a sustainable ethical and compliance standard implies that most of the business programs may not mature. This increases the risks of operation which may lead to loss of customers and business profits.
Lack of a business culture of ethics also influences the employee’s code of conduct. Employees lack that restriction and role definition element and this results to lack of accountability and responsibility. There lacks proper customer service measures, early detection of risks, early risk definition, risk prevention and response to risks.
An international business like HBSC requires maintenance and clear definition of ethics and compliance codes as in the LRN ethics and compliance policies (Cornelius, 2009). This is required for prevention of ethical and compliance lapses and to create an ethical profile that is internationally acceptable. The policy would also assist in responding to allegations or violations that may affect its image. This would create its reputation and maintain its customers thereby increasing the bank’s profit levels.
Reference.
Brenkert, G. G., & Beauchamp, T. L. (2010). The Oxford handbook of business ethics. Oxford: Oxford University Press.
Cornelius, D. (Feb, 25 2009). The 2008 LRN Ethics and Compliance Risk Management Practices Report.
