Ethical behaviour means acting in ways that are consistent with behaviours that society, individuals, and businesses have deemed to be “proper” or “correct.” Good values involve demonstrating respect for key moral principles that include honesty, fairness, equality, dignity, diversity, and individual rights.
The most important influence on ethical values in an association is its overall culture. The board and established members should set an example for new members of how to represent themselves and the association. An organization’s internal members have a great influence on the relationships the association has between its partners, vendors, members, etc.
Code of Conduct and Ethics
The most important way to ensure ethical behaviour within an association is to have a Code of Conduct and a Code of Ethics. Read my co-worker’s article, “Association Board Code of Conduct and Code of Ethics: Why are they so Important?” to understand why it is necessary for an association to uphold these ethical mandates.
Creating an ethics committee is a great way to set a “tone from the top” culture. An ethics committee creates and implements a program of controls and processes specific to its association. They promote and regulate ethical conduct and compliance. It will help to avoid diffusion of responsibility for an association’s culture of integrity.
Ethical Accounting Standards
Ethical standards and practices in accounting are key due to the confidential and sensitive nature of financial information. Designated accountants have a code of professional conduct. This specific set of rules is laid out by their governing bodies. Some of the most universal rules are:
- Independence in fact and appearance: Independence is the idea that an auditor is totally objective and free from any ties, relationships, or bias toward the association they are working with.
- Contingent fees are not allowed. For example, commissions or a percentage of revenue
- Confidentiality— All information shared with accountants must not be disclosed.
- Professional competence—the accountant must be honest about their academic credentials and necessary experience.
- Duty to report a breach in rules — If another accountant is to be observed violating the rules, the accountant has a duty to report it.
Making sure your association is working with an accountant who follows the ethical standards is vital to its success.
Unfortunately, there will always be circumstances where the ethical decision is not just simply right or wrong. Consultations with lawyers can help move the association in a direction that is morally sound while also adhering to the law.
Provide Clear Escalation Policies
The board of directors should have an escalation policy in place. It is important to have clear guidance on how to handle different types of situations. Provide comprehensible language in the association’s ethics guidance instructions. Encourage everyone involved in the association to speak up and take action if they think something is unethical.
It is also helpful to have anti-retaliation rules in place to ensure that everyone feels comfortable enough to report an issue when necessary.
Ethics Across the Association
Providing interactive training for all staff and members of the board is another way to ensure ethical compliance. Providing real case studies can help make the situations feel like real life circumstances. This helps people to feel more invested. It can also help everyone understand the ethical concepts and identify risk areas to watch out for.
When misconduct is detected, the board must respond the same regardless of the position or rank of the person in question. This will enhance the association’s culture of ethical behaviour by remaining fair no matter what.
Staying proactive and having the right framework and materials in place before an issue arises is the key to promoting good ethics within an association. The overall culture of an association can be shaped by keeping the board directors equally as committed to developing strong ethical values as they are to strategizing for the association long term.
For another view on managing ethical member behaviour read, “The Administrative Side of Member Ethics”.