A board's core purpose is to promote the long-term success of the company in line with its values. Boards that embrace ethical standards explicitly in the way they and the company operate are best placed to achieve the durable benefits that come from doing business ethically. 

The board is the forum for reviewing holistically the organisation's stakeholder relationships. In reality, it is the only forum, as it directs the company's purpose, business model and strategy.

 

IBE Guidance

A summary of good practice
  • It is imperative that the board review is based on the organisation's values. These are the foundation as to how business is done whatever the situation.
  • Values are not just about ensuring good behaviour by employees. They are also important support in decision-making. Boards frequently have to make difficult decisions and address problems for which there is no absolutely right answer, for example in considering executive remuneration, or the use of artificial intelligence. A clearly articulated and consistently applied set of values will help guide boards in their decision-making.
  • Directors also need to have a clear set of policies on topics such as managing conflicts of interest; financial reporting; and its dealings with stakeholders, amongst others.
  • As the board has responsiblity for the organisation's culture, it is good practice to establish a board level committee with oversight for establishing, reinforcing and monitoring the ethics policy and identifying ethical risks and opportunities.

 

Further resources 

Publication type: Board briefing

Ethics and Section 172: key questions for informed board decision-making

The aim of this Board Briefing is to help companies benefit from the new reporting obligation, and to encourage them to go beyond legal requirements. It is intended to convince companies to reflect their values in decision-making and report on what they have done to define and embed appropriate standards of conduct across the organisation.

19 February 2020

IBE news

IBE launches Ethics and Section 172 Board Briefing

Directors need to embrace the benefits of new reporting requirements, advises new report by Institute of Business Ethics.

19 February 2020

Blog

Now is the right time to look at your culture

Ethical failures in business continue to happen with depressing regularity. Unfortunately, many organisations are only spurred to look at their culture and take the steps to embed ethical values at the heart of their decision making after things have gone badly wrong and customers, shareholders and colleagues have suffered as a result. 

05 February 2020

Blog

The dissenting director

Often it can be difficult, if not impossible, for a dissenting director to stay on the board to implement a major decision that they have fundamentally disagreed with and voted against. But dissenting directors should not feel that resigning is their only option.

11 September 2019

Consultation response

IBE response to FRC Stewardship Code consultation

01 April 2019

Publication type: Other

A Year In Review: Ethical Concerns and Lapses 2018

Read the IBE's annual analysis of business ethics news stories from the last year - which were the sectors and issues most in the news in 2018?

30 January 2019

Consultation response

IBE comments on the NCVO draft code of ethics for the charity sector

28 September 2018

Consultation response

IBE response to consultation on proposed revisions to the UK Corporate Governance and Stewardship Codes

05 March 2018

Publication type: Board briefing

Culture Indicators: understanding corporate behaviour

This Board Briefing sets out to help boards through its examination of a range of relevant indicators and how to interpret them.

01 March 2018

Consultation response

IBE response to BSB consultation

27 September 2017

Publication type: Board briefing

Responsible Financial Reporting: doing the right thing

This Board Briefing examines the challenges and pitfalls and presents the elements of responsible financial reporting.

12 September 2017

Consultation response

IBE proposes significant changes to governance reform in response to BEIS Green Paper

17 February 2017

Publication type: Other

IBE 30th Anniversary: the next 30 years

The Institute of Business Ethics: the next thirty years is the result of a survey of opinion leaders to help identify the IBE's priorities for the coming period, the current business ethics climate and the future challenges to business in regaining trust.

27 October 2016

Publication type: Survey

Culture by Committee: the pros and cons

The idea of having a committee dedicated to the task of overseeing culture and ethics is relatively new. This survey report is intended to benchmark what is happening in the UK, providing a valuable insight into how companies are approaching the task.

09 March 2016

Publication type: Other

Red Flags: a report on identifying indicators of corporate culture

This report represents the conclusions of a workshop of senior regulators, company directors and executives and investors exploring ways of identifying early warning signs of a weak culture.

08 March 2016

Video

How can leadership communicate ethical values?

11 January 2016

Publication type: Board briefing

Checking Culture: a new role for internal audit

Checking Culture: a new role for internal audit shines a spotlight on the role of internal audit in advising boards on whether a company is living up to its ethical values.

15 July 2015

Publication type: Report

Ethical Challenges Facing Pension Fund Trustees

This report looks at the ethical challenges facing pension fund trustees - ranging from fiduciary duty, investment decisions and conflicts of interest to employing consultants. It poses at twelve key questions which pension fund trustees need to ask to help guide them in making sound decisions, and offers answers that, by applying an ethical approach, aim to cut through the uncertainty and help trustees make the right decisions.

29 October 2014

Publication type: Board briefing

Ethics, Risk and Governance

This Board Briefing sets out why directors need to be actively involved in setting and maintaining a company’s ethical values and suggests some ways to approach it. It aims to help directors define their contribution to the maintenance of sound values and culture.

21 July 2014

Publication type: Business ethics briefing

Business Ethics and Board Diversity

This briefing examines some business ethics issues and the challenges of achieving a diverse board. It presents the relationship between business ethics and board diversity; the current global context of board diversity and the case for board diversity. Using good practice examples it shows to achieve a diverse board.

11 September 2011