Definition of Code of Ethics

Code of ethics has been defined in many ways but a common understanding has not been developed on a single definition or what exactly a code of ethics consist of. Codes of conduct, codes of practice, ethical codes, ethical guideline, business conduct, codes of professional behavior and business codes, are just some of the various attempts to define or refer codes of ethics.

The purpose of the codes of ethics is basically to specify the moral standards of the organization and in the scope of this set of moral standards to guide the behavior of members of the organization, both in the relationship between each other and in their relation with society. Code of ethics is also considered as an efficient tool to transmit the culture of the organization to its members, giving them a sense of common identity, of being part of a unity.

The code which was adopted in 1937 by ICC (International Chamber of Commerce) is deemed as the first code of ethics. Thereafter it has been revised for many times. Than the codes of ethics have become widespread in developed countries, like the U.S. and Western European countries, but in recent years, this concept has been started to be adopted by the other countries such as the countries of Central and Eastern Europe. According to Mihai and Alina, the reasons for which the countries of Central and Eastern Europe have shown interest in this topic can be both social, because there is a direct relationship between the degree of development of a country and the importance that is given in that state to business ethics, and of economic nature – the competitive pressure induced by the increasing number of multinational corporations that have extended their activity in this regions.Nowadays, the codes of ethics are essential for most of the multinational companies since they are the components of corporate governance as it is also stressed by Corporate Governance Report which was issued by Capital Market Law.

Importance of Code of Ethics

Organizations should fulfill the law and code of ethics strictly not to face with direct economic losses, administrative penalties or not to damage the reputation of the organization which can create long-term costs. Accordingly, obtaining the business ethics and fulfillment can facilitate;

  • Establishing a moral contract between the organization and its beneficiaries, and also between those who belong to the same organization;
  • Protecting the organization from dishonest or opportunistic behaviors;
  • Promoting a positive image of the organization;
  • Providing a means of regulating the adhesion and the commitment of collaborators;
  • Creating a sense of belonging to the group; showing the managers’ commitment to principles;
  • Obtaining a contractual relationship based on trust and accountability;
  • Guiding the behaviors in case ethical dilemmas are encountered.

In a nutshell, codes of ethics are seen as an important tool in creating and establishing an ethical environment. However it should be noted that, if codes of ethics are not supported by embedding tools such as ethics training, a gap might be arisen between the policy and practice. In another words, it may not be enough to send a booklet to all employees and expect them to abide its content. 

Vedia Nihal Koyuncu Attorney At Law


  • BEKTAŞ, Çetin / KÖSEOĞLU, Mehmet Ali: İş Etiği ve İş Etiğinin Yayılım Süreci, Süleyman Demirel Üniversitesi İktisadi ve İdari Bilimler Fakültesi, C.13, S.1 s.145-158, 2008
  • ÇALIŞKAN, Esra Nemli: “Business Ethics, Corporate Social Responsibility and Multinational Companies”, İstanbul Üniversitesi Siyasal Bilgiler Fakültesi Dergisi, No:43, Ekim 2010
  • MIHAI, Berinde / ALINA, Andreescu Nicoleta: Business Ethics Implementation in the Organizational Culture of Companies, University of Oradea, Romania
  • WEBLEY, Simon / WERNER, Andrea: Corporate Codes of Ethics: Necessary but not Sufficient, available on.Wiley Online Library, 2008
  • YALLOP, Anca C.: The Use of Effectiveness of Codes of Ethics- A literature Review, Marketing-from information to decision, 5th Edition, UK 2012

MAYIS 2016

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