New code seeks to prick conscience of business

The new ethics code is considered to be in the long-term interest of the economy. imagepoint.biz

A code of conduct, which encourages businesses to act more ethically, has been launched in Switzerland.

But critics say the measures contained in it are too vague and don’t go far enough.

The Swiss Code of Ethics Association, an independent body whose members have an industry background, launched its new code on Friday.

“We are convinced that it is in the long-term interest of the economy, of the companies and their managers to act in an ethically correct manner,” the association’s president, Hans Wehrli, told swissinfo.

“Our code is not a list of rules and regulations, but it’s based on seven principles: responsibility, integrity, respect, transparency, justice, sustainability and corporate citizenship,” he added.

The code offers advice on how to deal with ethical conflicts arising from business situations, and the association will also be awarding a label “certified member – Swiss Code of Ethics” to companies which pass the two-year certification process.

Scandals

The code comes in the wake of several scandals in the business world, such as the collapse of the national airline Swissair and recent accounting troubles at the world’s largest employment agency, Adecco, which have shaken corporate and consumer confidence.

It has the support of 22 patrons from big business – including the country’s largest telecommunications company, Swisscom, and the national carrier, Swiss. Their job is to give advice, although they are not automatically included in the code.

Walter Bosch, vice president of the board of directors at Swiss, is one of the patrons. He says it is important for business to have such guiding principles.

“We have seen different kinds of problems in the past few years in the wake of the internet bubble that burst, the recession and these unreasonable packages that some managers granted themselves,” he told swissinfo.

“This brought mistrust – a widening gap between public opinion and top level management…so it’s acceptable to re-establish some ethical standards that everybody can rely on,” added Bosch.

Too vague

But sceptics say the fact the code is voluntary and not legally binding means it will likely have little effect.

“The risk is big that these are just empty words,” said Florence Gerber of the Berne Declaration, a non-governmental organisation. “It’s something really abstract and they don’t seem to have many concrete measures and commitments.”

Gerber told swissinfo that although moves by business to act more ethically were welcome, self-regulation was not in itself enough to combat bad behaviour.

The Berne Declaration wants a legally binding mechanism on a national and international level to ensure companies conduct themselves ethically.

“The codes of conduct are an advance, but they are not enough. They don’t apply to every company and they mostly don’t include monitoring and punishment mechanisms [which would demonstrate] that this is more than just public relations.

“The respect of human rights – and therefore of workers’ rights – is already a legal and moral obligation, not just a question of good will and vague ethical principles on behalf of business,” Gerber added.

Mixed record

Voluntary codes of conduct have become popular in Swiss industry in recent years, and although many firms fall short of the targets set, advocates say they have the effect of bringing ethical issues out into the open.

A survey last year revealed that around a third of the country’s top 100 firms had failed to meet corporate governance rules drawn up by the Swiss Stock Exchange.

“I don’t think everyone will change their behaviour by tomorrow and adhere to the principles, but maybe [the code of ethics] will make some people think about what they do and where they are heading,” said Walter Bosch of the airline, Swiss.

swissinfo, Isobel Leybold

In brief

The Swiss Code of Ethics is a new set of guidelines for businesses in Switzerland.

It is based on seven principles: responsibility, integrity, respect, transparency, justice, sustainability and corporate citizenship.

Apart from the code, the association will also be awarding a label “certified member – Swiss Code of Ethics” to companies which pass the two-year certification process.