Code of Ethics for Coca Cola Company
Coca Cola’s Code of Ethics
Coca Cola company has a set of ethical rules and guidelines that direct the actions and conduct of every employee in the organization. The company has several outlets throughout the world and the code of ethics applies to all its employees in different locations. Also, it applies to employees in different levels of organizational management, mainly senior and junior managers, directors, and other stakeholders whose action might affect the company’s reputation. The code of ethics determines the business conduct and compliance activities within and outside the company. As such, the firm has incorporated this code as part of its business culture. Also, the development of a hierarchy in addressing employee concerns and other external concerns has helped the company to minimize business and ethical violations. Coca Cola’s code of ethics helps in the maintenance of business integrity and communicates the company’s position and mission in promoting equitable business practices, compliance, and adherence to communal responsibilities.
Corporate Social Responsibility
Corporate social responsibility (CSR) dictates business practices and their costs and benefits to the communities. CSR is a company’s method of asserting its commitment to ethical business practices which, in turn, improve the quality of life of the employees, local communities, and other stakeholders. The Coca Cola Company operates in over 200 countries in the world. Each country benefits from the company’s initiatives, which include water preservation, environmental protection programs, women empowerment, and other humanitarian programs. However, Coca Cola’s CSR fails to reflect the various health implications that the company’s processes and products pose to the environment and its consumers. The company has failed in revealing the different ingredients and their health effects to the consumers. Also, the firm’s processes bring about environmental concerns in different parts of the world. The failure of the company to addresses these issues has led to increased contamination and health issues for its consumers worldwide (Coca Cola Company, 2017). Thus, its CSR should address the multiplicity of issues that the company’s activities, products, and employees pose to the community, consumers, and the environment.
Legal Mandate Compliance
The Coca Cola Company has established its roots over the world; as such, it has outlined an ethical code that fulfills the required legal mandates in the industry. The company has put in place expectations on ethical behavior and guidelines. The establishment of code compliance officers within the organization helps with approvals and the process of raising concerns and other ethical violations. The code of business conduct ensures that employees and employers adhere to legal specifications. The legal mandates promote the firm’s credibility by improving public trust towards the company. Moreover, the firm has invested in private auditors who ascertain the legality and ethical nature of the various activities (Coca Cola Company, 2017). The elaborate plan to ensure compliance to legal mandates is enhanced by the multiple channels put in place to report ethical violations. The firm’s system ensures that employees report their concerns without fear of retaliation or other adverse outcomes.
Implications of Noncompliance
Noncompliance to legal mandates within the company leads to the erosion of investor confidence and affects the firm’s functions and profitability. The company and its workforce would face penalties and other disciplinary actions for violation. Internal disciplinary measures include suspension, demotion, and bonus withdrawal among other forms of punishments. Also, noncompliance attracts criminal procedures from relevant authorities. Legal and government institutions address the company’s noncompliance to prevent its management from committing further violations. For example, violations such as bribery would attract severe consequences such as dismissal and imprisonment. The company’s ability to grasp competition laws is challenging and any violations attract civil and criminal penalties for the firm and its employees.
Legal or Ethical Safeguards
The company code of conduct has put in place several safeguards such as anonymity and confidentiality for employees who seek to raise ethical concerns. The state of anonymity protects the employees from harassment and other forms of victimization. Also, the confidentiality aspect helps in compliance during investigations and improves the chances of fairness and thorough outcomes. The involvement of managers, legal department, and compliance and ethics officers leads to the establishment of an elaborate chain of command and reporting process for ethical violations. Moreover, the safeguards guarantee ethical behavior among employees by ensuring they do not ignore or assume their responsibilities to the organization. The safeguards include a code of business conduct that is part of the organization’s culture. The company invests in employee training, which facilitates a proper understanding of the ethical code and guidelines. Conducting annual or bi-annual ethics audit is part of the organization routine to assess its adherence to the code of business conduct. Thus, the legal and ethical safeguards act as protection devices for the organization against external attacks and further violations from employees.
Development of an Ethical Culture
The code of ethics is crucial in the development of an ethical culture for Coca Cola Company. The codes guide the different outlets in the world thus ensuring uniformity in mission, vision, and values for the employees. The ethical framework guides the firm’s workforce in different parts of the world thereby guaranteeing proper regulatory procedures. Moreover, indoctrination of the code and strict adherence to the set standards shape the company’s ethical culture worldwide. Therefore, the code of ethics is written and passed down through employee training and induction processes thus ensuring they adhere to the company’s standards (Coca Cola Company, 2017). As such, the code of ethics promotes an ethical culture within the organization given its expectations from employees.
Raising an Ethical Concern
Ethical concerns and violations have serious consequences on the company’s sustainability, profitability, and reputation. Such concerns are a cause for an alarm in the organization hence the need for specified steps in addressing these situations. The initial step is to report to an immediate supervisor or department head. The involvement of the human resource department and legal officers help in the establishment of facts, which is essential in reporting and proper investigation processes for the relevant authorities. The involvement of the ethical officers in reporting ethical concerns determines the rationality of the reports (Coca Cola Company, 2017). Thus, ethical and legal standards put in place protect the anonymity of the employees.
Resources Available to Employees
Employees have access to different levels of legislation that determine their direction in the process of raising ethical issues. Federal, state, and employment laws promote whistleblowing and other processes in raising ethical concerns about an organization. Access to the law acts as a protection mechanism against company liabilities and other adverse outcomes. The pursuit of external legal direction prevents actions such as retaliation from the company. Besides the external legal influences, Coca Cola employees have access to an internal legal team tasked with protecting the firm’s reputation and investigating all ethical claims. An internal legal team is a subtle approach that seeks to establish the possible implications of the concern to the organization. The Coca Cola Company has established a confidential speak-up line operated by an independent party that helps employees to maintain confidentiality while raising concerns. The independent party is a separate entity from the organization thus ensures employees are comfortable sharing information.
The resource I would use for raising ethical concerns is the independent party. First, the party would guarantee the confidentiality of my identity and information shared. Also, the independent party is impartial thus would conduct a fair evaluation of the ethical violation. The independent party is likely to seek outside legal counsel, which is effective and unbiased in opinion. Moreover, the party withholds the rights of the employee as it seeks to protect them from organizational interference and other forms of retaliation.
Policy for Addressing Unethical Conduct
The proactive policy is effective in addressing unethical conduct in the organization. The approach requires an evaluation of internal systems within an organization to determine the right process of addressing ethical concerns. The proactive approach involves the creation of a code of ethics that is written down and communicated to the entire organization. The company introduces the ethical vision, which highlights employee expectations and instructions. The proactive approach sets up internal systems for anonymously reporting unethical behavior. The approach relies on the organization’s ability to empower employees and train them on the code and relevant course of action in case of a violation (Mayer, Nurmohamed, Treviño, Shapiro, & Schminke, 2013). Thus, the effectiveness of the approach depends on the employee’s ability to understand the relevance of the code of ethics.
Whistle Blowing Conditions
Internal whistleblowing is challenging in modern organizations since it suppresses the employee’s will and freedom. The internal systems are ineffective thus whistleblowing yields little results with regards to poor reporting. In most cases, employees choose to observe only and often fail to report unethical conduct in the workplace (Chen, 2018). As such, employees should consider various factors before whistleblowing including an evaluation of their intentions and viewpoint on issues they consider wrongdoing. Whistleblowing aimed for the fulfillment of a personal agenda renders the report malicious and harmful to the organization.
Moreover, it is important to gauge the level of influence or power an individual possesses for introducing positive change in the organization. The potential for change is evaluated through risk and benefit analysis, which gauges the effects of the action on the organization and the individual. In some cases, short-term changes to the organization are not adequate reasons for whistleblowing since they can be incorporated into the company’s planning, and such exposure would affect its long-term goals. Also, consideration for reputation is an essential factor in whistleblowing because it protects the management, stakeholders, and the organization from image damage. It is important to come up with contingency plans that serve as alternatives if the initial plans or goals are unattainable. The contingency ensures the continuation of organizational operations until the attainment of the desired outcome.
If an employee decides to adopt whistleblowing techniques to expose unethical practices within the organization, they should first inform a senior manager or supervisor who is unaffected by the wrongdoing. The identification of an impartial manager leads to the establishment of company protocol and authority thus ensuring credibility. Next, the employee should inform their family members or friends to prepare them for unexpected outcomes. Moreover, if the intra-organization communication fails, an employee can seek counsel from an external ethics office or legislative authority. The external legislation offers direction on the techniques and legal issues regarding whistleblowing. The pursuit of outside legal or ethical intervention leaves an organization without internal control thus prompting the management to prepare its defense to protect the firm’s operations and employees against the concerns. In extreme cases, an employee is required to leave the firm if there lack viable alternatives to the issue. Handling ethical complaints internally saves the organization on legal costs and other outcomes that result from external exposure.
Advantage and Disadvantages of Paying Whistle-Blowers
Paying whistleblowers leads to the elimination of fraud among government contractors. The government suffers tremendous losses from fraudulent claims by contractors. According to the False Claims Act, the federal authority imposes liabilities or penalties to people or organizations that perform fraudulent activities against the government. A whistleblower under this Act benefits from government protection and popularity in the public space. However, they lose the trust of the public and private space, thus impacting future career prospects negatively while the government benefits significantly from such cases. In addition, whistleblowers are essential in the creation of financial reforms. According to the Dodd-Frank Wall Street Act, whistleblowers speak up against unethical financial practices in an organization. The involvement of the whistleblower is to expose fraudulent means of obtaining proceeds, mainly from financial institutions and hedge funds. Therefore, the legislation benefits the whistleblower through monetary compensations to ensure they reveal such acts in organizations.
Moreover, the Consumer Protection Act indicates that paying whistleblowers favors public interests and welfare as opposed to exploitative organizations. The role of the whistleblower is to extend public revelation of the legal violations that affect public health, safety, and other welfare issues. The whistleblower adopts the title “savior of the people” since they expose injustices to the consumer. On the other hand, the act affects organizations negatively by tainting their reputation and public profile. Furthermore, whistleblowers are crucial in the investment platform. The Sarbanes-Oxley Act safeguards the interests of investors by protecting them from fraudulent corporate activities such as wrong financial reporting. The Act enforces penalties and other regulations for such violations. The law benefits new investors who utilize the accounting regulations to understand the real position of a company.
The Impact of U.S. Sentencing Guidelines on the Organization
The U.S. Sentencing Guidelines are a source of incentive for the organization because a firm can mitigate penalties and other legal consequences by self-reporting. Also, active participation in the investigation process and cooperation helps in the attainment of leniency in sentencing. The guidelines are essential in the development and implementation of a company’s code of ethics and compliance regulations. Moreover, the guidelines influence corporate law and regulatory procedures since companies adopt the rules to plan and regulate their activities (Sample, 2015). Thus, the federal sentencing guidelines significantly influence the organizational philosophy since the code of ethics is integral in forming a culture of integrity.
Different culpability factors determine sentencing and assess the organization’s position and impact. First, an organization’s tolerance or involvement in criminal activity determines the seriousness of the offense and the possible courses of action. Also, federal sentencing authorities consider previous involvement in unethical activities. Lastly, ascertaining whether the organization has implemented effective ethics and compliance procedures determines the sentencing directions (Sample, 2015). Thus, these factors determine punishment mitigation or other alternative forms of punishment for the organization.
The establishment of an organizational code of ethics regulates employee conduct. It determines business practices and the recommended course of action in case of any violations within the organization. The Coca Cola company code of ethics is part of the organizational culture as it promotes integrity among employees and in business activities. The culture of integrity has helped in building a good reputation for the organization across different regions in the world. Ethical violations are a common phenomenon among organizations and the development of reporting mechanisms provides proper channels for employees to report unethical conduct. Whistleblowers can utilize internal or external reporting systems, both of which would impact the organization significantly.
Chen, X. (2018). A Summary of Research on the Influencing Factors of Employees’ Willingness to Whistle-Blowing. American Journal of Industrial and Business Management, 08(07), 1732-1746. doi:10.4236/ajibm.2018.87116: https://www.scirp.org/Journal/PaperInformation.aspx?PaperID=86191
Coca Cola Company. (2017). Code of business conduct: Integrity in the company, integrity in the community. https://coca-colahellenic.com/en/about-us/policies/code-of-business-conduct/
Mayer, D. M., Nurmohamed, S., Treviño, L. K., Shapiro, D. L., & Schminke, M. (2013). Encouraging employees to report unethical conduct internally: It takes a village. Organizational Behavior and Human Decision Processes, 121(1), 89-103. doi:10.1016/j.obhdp.2013.01.002: https://pdfs.semanticscholar.org/e8f6/1ca652c4d0838fc2437337f8860aa3eb597e.pdf
Sample, J. (2015). Compliance and ethics programmes and the Federal Sentencing Guidelines for Organizations in the United States: implications for international HRD specialists. Human Resource Development International, 18(3), 295-307. doi:10.1080/13678868.2015.1071991: https://www.tandfonline.com/doi/abs/10.1080/13678868.2015.1071991?scroll=top&needAccess=true&journalCode=rhrd20
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