Contractor Code of Business Ethics Part II: Is it Working? (Part II of a Three-Part Series)

As we move forward into the new year, federal contractors of all sizes, services, products and market niches will be held to higher ethical standards than ever before. In Part I of this series, “Contractor Code of Business Ethics Part I: Why Bother?” we talked of the importance of having a code. However, having the code is just not enough. It is implementing that code – and “making it stick.” Without meaning the code is simply window dressing.

If we don’t take ethics seriously, especially in the area of federal contracts, serious ramifications could result for organizations, their employees and by extension many other businesses inside and outside of government.

Contractor Code of Business Ethics – How Effective is Your Compliance?

Once a Contractor Code of Business Ethics has been put in place as part of a federal contractor’s requirements, there are several measurements to gauge that effectiveness. Some measures are quite simple and straightforward while others are more complex and need reinforcement. All are important.

Here is a simple checklist with comments to help your organization determine if you are fully compliant as a federal contractor. I might also mention that even if your firm is not a federal contractor, virtually every point is applicable to you as well:

1. Have you a Business Code of Ethics and Conduct? If one has not been produced not only might you be out of compliance as a federal contractor, but you are opening yourself up for numerous problems.
2. If you have a Business Code of Ethics and Conduct does every employee have a copy? This doesn’t just apply to senior management but to everyone in the organization or minimally to every department. We never want to hear, “I didn’t know a code of ethics was in place!”
3. Are posters and information in place throughout the facility making sure to advise all employees of a Business Code of Ethics and Conduct?
4. Is there a training program in place to reinforce the Business Code of Ethics and Conduct? We will talk about this more just a bit later.
5. There are numerous violations of a Business Code of Ethics and Conduct that should be easily identifiable for any and every employee in a federal contractor’s organization. This again embraces training. A federal contractor employee who does not have access to a Business Code of Ethics and Conduct may confuse a “gift” with an attempt to bribe. Therefore, an employee should be trained enough to report misconduct. Included in these misconducts are:
6. Bribes of cash, goods or services;
7. Forcing an employee to have a conflict of interest (there are many variations here);
8. Accepting “tips” for performing a service (not necessarily cash!);
9. Forcing an employee to make a false claim;
10. ANY situation where there is discrimination in place or a hostility. This applies to all departments and all levels across the board. This can range from sexual harassment to religious persecution, improper jokes, unwanted advances or touching and on and on.
11. It is one thing to be sexually harassed or bullied or bribed and quite another to be freely empowered to report it without retribution on an anonymous basis if necessary. As a federal contractor, how assured is every employee that such a system is in place?
12. If a report is given of misconduct how confident is every employee that it is investigated fully and efficiently within an aggressive time frame?
13. Is there a system of internal ethical monitoring in place and are there systems in place to enable your organization to work with outside investigators or auditing firms if necessary?

Chuck Gallagher: Ethics Training for Federal Contractors

The most ethically compliant programs for federal programs are those where ethics training is routine – and reinforced. Gone are the days where contractors are given a pass or paid “lip service” on matters of harassment, bribe taking or discrimination in the workplace.

We know from experience that some employees take these matters seriously, some treat these issues as a joke and most are extremely confused as to ethical versus unethical behavior. Ethics training should lend a no-nonsense interpretation to what is expected and it should convey clear-cut consequences of unethical workplace choices. Ethical training helps makes certain that the Business Code of Ethics and Conduct is not just a printed booklet, but a real-life document that is working.

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