Why every business needs a code of conduct

A code of conduct may appear tobe a luxury that only large companies can afford, but in reality they're a necessity for business of all shapes and sizes.

“You should have a code of conduct and it should be tailored to your business," says workplace lawyer Joseph Kelly, who notes that workplace laws over the past few years have been putting the onus back on the employer. “These laws state that the person who can best control the culture within a workplace is the employer.”

While some large corporations’ policies are biblical, covering every eventuality in every global location they operate, this is clearly overkill for a small business. Think of it as the minimum you need to convey to your team so they know your expectations and have a clear idea of how to conduct themselves.

A code of conduct communicates company values and principles, and people like clarity, says Ed St John, executive general manager at The Ethics Centre in Sydney, a not-for-profit that advises companies on good behaviour. As one would expect, the Centre has a code of conduct – even though it has just 20 staff – which it calls its Workplace Guidelines.

Keep it simple

After all, people need to know how many hours a day/week you expect from them, whether they can work from home, and the procedures you expect from them when calling in sick. The Ethics Centre's code of conduct is a mere three pages. “People appreciate the clarity but you need to keep the detail out of it as much as possible,” says St John, who counsels against a 'sledgehammer approach'. “It’s unnecessary to have a whole lot of rules and regulations that tell people what to do, because it insults people’s intelligence and it’s the wrong way to manage people.”

Rather than a list of ‘thou shalt nots’, your code should provide good behavioural guidelines. “My experience from managing different companies is that people rarely behave badly, so rather than write a policy for that rare person who has done the wrong thing, you’d be better off writing a policy for that majority of people who want to do the right thing, otherwise people feel like prisoners with a list of ‘don’ts’."

Understanding and determining your own values and principles is a great place to start, says St John. “If your values are that you trust your employees and you value their wellbeing, create policies that reflect that. People really appreciate that clarity - having an idea of what you believe in and stand for as a company and how much you trust your people to do the right thing.”


Follow the law

You should also note that the code needs to uphold and not disregard the law. The minimum number of sick days allowed and minimum maternity leave period are mandated by the Fair Work Act. “You can either replicate them in your workplace guidelines or point people to the Act for further information,” says St John."

Be authentic

When crafting your code, think of the types of behaviour you're trying to encourage and those you want to discourage. That should give you a starting framework. Your stated values need to be authentic. You need to walk the talk yourself. “There’s no point having a set of rules that the management team openly flouts, that creates a great deal of cynicism,” says St John.

Health and safety concerns should be at the heart of every code of conduct, regardless of whether your place of work is a factory, office or restaurant. The policy should set out the allocated hours you expect your people to work. “It’s incredibly important that you call out in your policy what you expect as an acceptable level of commitment, otherwise some may feel that to get on in that company, they have to burn the midnight oil. That’s a very unhealthy way to approach a workplace in this day and age,” notes St John.

Be wary of social media

Your code should cover your expectations of social media usage, notes Kelly, especially when the line between private and work lives is increasingly blurred. “A code of conduct should make it clear what is acceptable and unacceptable as regards to social media,” says Kelly.

The values you advocate also need to be practical and simple so they can remain in place for many years, although it’s recommended that you revisit them with your team from time to time, in order to refresh them and make sure everyone is still on the case. “It would be best practice to revisit those guidelines on an annual basis. When you don’t reinforce those things they get forgotten and some other unthinking practice creeps in over time,” adds St John.

10 Steps to create a Code of Conduct PDF

Keen to communicate your business values for a better workplace? Get started on your own Code of Conduct with our helpful PDF guide: 10 Steps to Create a Code of Conduct. You can also download it as a Word document below.

10 Steps to create a Code of Conduct Word Document

Download as a word document: 10 Steps to create a Code of Conduct