Nearly half of companies in the UK’s FTSE 350 index lack a publicly available code of ethics, fueling concerns that staff do not feel safe raising the alarm for misconduct.
The number of companies publishing their codes of ethics is significantly fewer in the mid-cap FTSE 250 index than in the blue-chip FTSE 100, according to research released Monday by the Institute of Business Ethics, which advises businesses on good practice.
Employees’ ability to speak up when they see or experience workplace misconduct is in the spotlight after the CBI business lobby The group was forced to suspend operations following reports by The Guardian newspaper of a range of allegations, including sexual harassment and rape, by former employees.
“There are . . . a worrying number of FTSE 250 organisations, which are among the largest companies in the country, without a publicly available code of ethics,” said Ian Peters, director of the IBE. Firms without written codes “risk the loyalty and support of both staff and customers,” he added.
British companies already have caveats addressed by the Chartered Institute of Internal Auditors of a “post-Covid organizational culture crisis”.
Only 40% of companies in the FTSE 250 have a publicly accessible code of ethics compared to 90% in the FTSE 100.
The lower rate of disclosure by mid-cap companies is in line with other areas of governance, where directors and auditors report that the largest UK listed companies are more likely to voluntarily adopt best practices in processes such as internal controls and reporting of non-financial information metrics.
The research also raised concerns about the quality of some of the codes, with the institute classifying only 57% of the documents as ‘good’.
It highlighted that only half of FTSE 100 companies provide publicly accessible written assurances that staff will not face retaliation for reporting concerns about unethical behaviour, with just over one in five FTSE 250 companies providing a similar assurance.
Despite this, the report found improvements in the quantity and quality of ethical codes published by companies.
The number of FTSE 100 companies with a publicly available code increased from 81 in 2021 to 90 this year, while the number rated as good rose from 46 to 57. Codes updated in the last three years were more likely to be assessed as measuring up, the institute said.
Establishing and maintaining an acceptable culture was much more likely, Peters said, when “companies take the trouble to put the right ethical framework in place and keep checking that it works.”
—————————————————-
Source link