Report covers recent corporate misconduct and outlines the ethics and compliance programs and practices that should be in place to mitigate risks and to drive business success
PHOENIX, AZ / ACCESSWIRE / May 22, 2023 / For corporate leaders looking to avoid reputational and business failures, Ethisphere, a global leader in defining and advancing the standards of ethical business practices, has released a new report titled: Future-proofing your Ethics & Compliance Program: Insights & Data from the World's Most Ethical Companies. To download the report, visit 2023 Data Insights Report - Ethisphere | Good. Smart. Business. Profit.®
The report looks at five recent case studies in which the lack of ethics and compliance controls and practices has resulted in damaged reputations and business losses. It then highlights the data and practices of the World's Most Ethical Companies and provides practical steps to embed business integrity throughout a business.
"Every time a company makes headlines for the wrong reasons, it has a tremendous ripple effect that is felt by innocent people," says Ethisphere CEO Erica Salmon Byrne. "By pulling the pragmatic from the theoretical and making it accessible and attainable, this report proves how robust governance, ethics, and compliance programs foster environments in which businesses succeed and all stakeholders benefit."
The report covers the five key areas featured in the Ethics Quotient, the 200-point evaluation framework used in the World's Most Ethical Companies application process. Data highlights include:
- Ethics and Compliance Program: 79% of the World's Most Ethical Companies have a Chief Ethics and/or Compliance Officer. This is particularly relevant to the recent Silicon Valley Bank collapse, in which the organization was without a Chief Risk Officer for eight key months before its demise.
- Culture of Ethics: 59% of World's Most Ethical Companies honorees provide results of culture measurement to all employees. Transparency and a focus on ethical culture could have mitigated Major League Soccer team Real Salt Lake's (RSL) player and fan boycotts in 2020.
- Environmental and Societal Impact: 93% of World's Most Ethical Companies honorees regularly communicate with their third-party business partners about ESG. Setting clear guidelines and expectations with vendors about working conditions - and enforcing them - could have helped UK-based fast-fashion manufacturer Boohoo avoid a customer boycott in 2020, which caused a share price drop by 46% within a week, wiping out nearly $1.9 billion in Boohoo's market value.
- Governance: 87% of World's Most Ethical Companies honorees provide some form of standalone training to their Board. Instituting a Board of Directors, and ensuring it is fully equipped to provide meaningful guidance on matters such as corporate culture, business strategy, and risk management, could have been instrumental for avoiding the recent downfall of FTX-a cryptocurrency exchange run by Sam Bankman-Fried.
- Leadership and Reputation: An organizational reputation for ethical behavior depends on three things: clear and unambiguous mission, vision, and values; values-based leadership that puts words into actions; and clearly communicated proof points to uphold its social license. Following these tenets could have avoided some of the negative impacts to business at Twitter-increased service outages, sharp drops in advertising revenue, and a valuation decrease by more than half-that has taken since its new leadership in October 2022.
To download the report, visit 2023 Data Insights Report - Ethisphere | Good. Smart. Business. Profit.®
To learn more about the findings, join a webinar on May 23rd from 1-2 pm EDT. Register at Ethisphere.com/events.
The Ethics Premium
Organizations should take note of the practices of the World's Most Ethical Companies. Strong ethics is good business. Ethisphere's 2023 Ethics Index, the collection of publicly traded companies recognized as recipients of this year's World's Most Ethical Companies designation, outperformed a comparable index of large-cap companies by 13.6 percentage points over a five-year period. This outperformance is the result of the kinds of practices that lead a company to be on the World's Most Ethical Companies honoree list -investments in their people, culture, and communities.
Ethisphere is the global leader in defining and advancing the standards of ethical business practices that fuel corporate character, marketplace trust, and business success. Ethisphere has deep expertise in measuring and defining core ethics standards using data-driven insights that help companies enhance corporate character. Ethisphere honors superior achievement through its World's Most Ethical Companies® recognition program, provides a community of industry experts with the Business Ethics Leadership Alliance (BELA), and showcases trends and best practices in ethics with Ethisphere Magazine. Ethisphere also helps to advance business performance through data-driven assessments, benchmarking, and guidance. For more information, visit https://ethisphere.com
About the World's Most Ethical Companies
In 2006, Ethisphere launched the World's Most Ethical Companies® recognition program to measure and showcase the superior achievements of organizations that are committed to doing business with ethics and integrity. The process is rigorous and objective. It includes a 200-point assessment, documentation review, and research into an organization's reputation and ethical practices. The process itself provides a way for organizations to assess their own programs against leading practices. World's Most Ethical Companies honorees also enjoy recognition of their exceptional ethics and compliance programs. Ethisphere also broadly shares the World's Most Ethical Companies data to help all organizations understand and improve programs. Learn more about the World's Most Ethical Companies at WorldsMostEthicalCompanies.com.
The data found in this new report is powered by The Sphere-Ethisphere's on-demand platform that gives access to 200+ ethics, compliance and ESG data points highlighting the practices of the World's Most Ethical Companies and other leading organizations. It also provides the ability to access to related regulatory guidance and expert insights to inform and advance ethics and compliance programs. To learn more, visit ethisphere.com/sphere.