According to LRN’s review of 147 publicly disclosed codes of conduct from the top 40 listed companies in each of the US (S&P), UK (FTSE), France (CAC), and Germany (DAX), half of the codes were deemed “effective”; one-third were deemed “less effective”; and 17% were deemed “more effective” based on its proprietary Code of Conduct Assessment Tool, with US company codes reportedly outperforming codes of companies in other jurisdictions across nearly all of LRN’s eight key code effectiveness dimensions.
The report discusses each of the eight key dimensions of code effectiveness and associated benchmarking data, and practical, best practice code enhancement tips that are accessible to companies of all types and sizes.
For example, nearly all “More Effective” codes include a leadership message to help demonstrate the “Tone from the Top,” compared to 50% of “Less Effective Codes.” LRN suggests companies include a strong, but brief, leadership message in the code that aligns with/integrates the company’s purpose and values.
Nearly all “More Effective” codes include hotline details (the “Speaking Up” dimension), compared to 8% of Less Effective Codes. Companies are advised to include multiple avenues for inquiries and reporting in the code and to explicitly address anonymity, confidentiality, and the company's anti-retaliation policy.
Access additional resources on our Compliance & Ethics page.
This post first appeared in the weekly Society Alert!