Good Evaluation Of A Business Code Of Ethics: Exxon Mobil Corporation Essay Example

Introduction

A code of ethics is a vital part of the effective operation of an organization. It lays down the expectations that members at various levels of the organization must adhere to in order to guarantee efficient and effective operations. Various corporations worldwide depend on a code of ethics they have developed to ensure proper relationships with the government, customers, employees, management and other organizations. An analysis of Exxon Mobil reveals the effectiveness and various features of its code of ethics.

Exxon Mobil

Exxon Mobil Corporation is a worldwide marketer and manufacturer of commodity petrochemicals including; aromatics, lubricants, olefins, asphalts, and polypropylene among other products. Since its incorporation in 1882, the corporation has also expanded its involvement in electric power generation (Reuters, 2014). The corporation produces technologically advanced products for major industrial and vehicle equipment; this ensures the protection of customers’ engines and machinery to ensure peak performance. It focuses on the business of energy production through the exploration for and production of natural gas and crude oil. It manufactures transports and sells crude oil.
The Corporation is a global organization with a strong distribution network; this focuses on the delivery of a reliable supply of high-quality products. It shows in the mission statement that Exxon Mobil Corporation’s commitment is to be the premier petroleum and petrochemical company in the world. To that end, the company constantly tries to accomplish superior operating and financial results; all the while abiding by exceptionally high standards of conducting business. They commend their commitment as a result of their unwavering expectations to those with whom they interact.

Ethical System

The Corporation adopts a duty-driven ethical system in its operations; this is evident in the focus on adhering to laws during all operations. The policy at the Corporation focuses on compliance with all government rules, laws, and regulations that apply to the business (Exxon Mobil, 2004). The approach ensures the exhibition of duty-based ethics that justify every individual’s behaviors in terms of upholding the corporation’s policy, adhering to the law and satisfying customer needs. It ensures every employee; manager or director satisfies the outlined expectations through their actions. It upholds obligation and doing what one is expected to do at all times. Even in situations where the law is permissive, each is expected to select the course of the highest integrity. Exxon Mobil focuses on ensuring that fair means are used in obtaining results; this ensures compliance with its standards of integrity.

Use of the code of ethics

The Corporation’s code of ethics was developed to ensure personnel contribute towards its performance with the highest ethical standards of business conduct; this occurs in order to maintain its competitive strength and global license to operate. The code consisting of policies and procedures applies to all directors, employees and managers according to Exxon Mobil (2004).
In regard to employees, the code ensures all personnel adhere to expectations; they are all subject to disciplinary action if violations of the policies occur. In order to keep the employees aware of the code’s provisions, employee trainings on ethics policy occur every four years. It occurs through the implementation procedures and guidelines, the corporation’s anti-corruption and anti-trust policies, and business practices reviews. The reviews include a detailed review of the Standards of Business Conduct (Tillerson, 2011). The code of ethics outlines guidelines that ensure all employees adhere to rules, laws and regulations.
In regard to management, all managers must use the code’s provisions in ensuring professionalism, resourcefulness and dedication to the corporation’s goals and mission. The managers ensure no one within the corporation makes exceptions or grants waivers if a policy violation occurs (Tillerson, 2011). According to the code, management provides clarification and needed information concerning the policies through the code’s procedures and open door communication (Exxon Mobil, 2004).
The code ensures the board of directors’ involvement of managers and employees in the development, approval and implementation of its provisions. It ensures a collective approach towards the achievement of the corporation’s goals. According to its provisions, the board of directors adopts and oversees the administration of Exxon Mobil’s Standards of Business Conduct; this is because policies contained in the code form the foundation of the corporation.
When, how and why the code of ethics is used at Exxon Mobil is discussed below. The code applies at all times during the corporation’s operations; every member is expected to uphold the highest ethical standards of business integrity. The code is a reference dictating whether every action by personnel is appropriate or not. The corporation does this by referring to its provisions whenever actions contrary to its expectations occur. It includes a violation of its; standards of integrity, conflict of interest policy, directorships policy, corporate assets policy, procedures and open door communication, and government laws applying to its operations (Exxon Mobil, 2004). The corporation uses the code of ethics to ensure all personnel including employees, directors and managers work in compliance with the government’s and corporation’s expectations. It ensures protection of the corporation’s reputation, upholding ethical standards, and ensuring satisfaction of the customers’ expectations in regard to the quality of services and products offered.

Why and how modification can occur

The company’s code of ethics is effective in controlling the actions of every personnel and ensuring they work towards the achievement of the corporation’s goals. However, modification of the existing code of ethics must occur; this makes it more aligned with global policies and practices. It is vital to note that Exxon Mobil is not party to the United Nations Global Compact.
The code of ethics can first be modified by ensuring Exxon Mobil becomes a signatory of United Nations Global Compact. As the CEO, I will facilitate necessary changes in the code. It will be achieved by making the board of directors, managers and the employees aware of the benefits likely to emerge from embracing global policies and procedure sin regard to business ethics. The modification will occur through the adjustment of the code’s provisions. That will ensure efficient description of the Corporation’s global ethical conduct and also for its majority-owned subsidiaries. The changes would then be adopted and administered by the board of directors; the Board will ensure the preservation of the value of human rights, the environment, labor and anti-corruption policies.
The change can be implemented through the comprehensive communication about the changes and their implications for the corporation’s employees, managers, and stakeholders. Assembling a strong team will ensure the drafting, implementation and monitoring of compliance with the new code of ethics within the corporation.

Reactions from employees and managers

The reaction from employees and managers to changes in the code of ethics depends on their understanding of its implications for them and their roles in the corporation. It the code considers their needs and provides a conducive work environment, they are likely to embrace it. Opposition may, however, arise if they feel the code’s provisions are too rigid. A code of ethics reflecting the corporation’s existing organizational culture is likely to be embraced. It must contain provisions ensuring managers and employees adhere to rules ensuring values, attitudes, language, beliefs and behavior patterns that are in line with the organizational culture.

Effect of the code on the corporation

The code will ensure an increase in commitment to meeting the world’s ever-growing demand for energy and related products. It will ensure every member of the corporation makes significant contributions towards the provision of high-quality products and services in an environmentally, economically and socially responsible manner. The new code of ethics will enhance the corporation’s reputation worldwide and expose it to a global market thus increasing its customer base. It will ensure the corporation’s progress economically as well as its contribution to the society and the environment.

Conclusion

A code of ethics remains a vital part of a corporation and other organizations. Creating and adhering to an effective code of ethics enhances decision-making processes. It also improves the relationship between management, the board of directors, employees, the customers and other organizations. An analysis of the code of ethics at Exxon Mobil reveals how it reduces the ambiguity of considerations of individual perspectives by developing ethical standards applying to all.

Reference

Exxon Mobil. (2004). Code of Ethics and Business Conduct. Irving, TX: Exxon Mobil Corporation. Retrieved January 26, 2015 from http://corporate.exxonmobil.com/~/media/Miscellany/2004/investor_governance_ethics.pdf
Reuters. (2015). Profile: Exxon Mobil Corp (XOM.N). Retrieved January 26, 2015 from http://www.reuters.com/finance/stocks/companyProfile?symbol=XOM.N
Tillerson, R. W. (2011). Standards of Business Conduct: A letter from Chairman and C.E.O., Rex W. Tillerson. Exxon Mobil Guiding Principles. Retrieved January 26, 2015 from http://corporate.exxonmobil.com/en/company/about-us/guiding-principles/standards-o