What are Ethical Standards?

Definition: Ethical standards are a set of principles established by the founders of the organization to communicate its underlying moral values. This code provides a framework that can be used as a reference for decision making processes.

What Does Ethical Standards Mean?

These standards are an important part of an organization’s culture. They establish the parameters of behavior that owners and top executives expect from employees and also from suppliers, at least to the extent of their relationship with the organization. A corporate governance system will put a lot of effort into communicating and enforcing these principles. This is mostly done through behavior modeling, which means that top executives should set the example of how lower-level employees should act.

A few examples of these standards would be responsibility, honesty, transparency or fairness and even though they might be interpreted differently by each person, companies usually describe the founder’s perspective of each value to avoid confusions.

These principles should serve also as guidelines for decision-making processes to help employees align their personal criteria with the company’s perspectives as different ethical issues arise within normal business activities. This moral “compass” is crucial to maintain unethical behaviors down to a minimum, mostly in managerial positions.


Top Position LLC is a digital marketing company that advices other businesses to position their products, brands and institutional image within the virtual environment. The company was founded by Robert Johnson, a marketing expert with a vast experience working with Fortune 500 companies. Robert has been struggling with a vague corporate culture that has been established within his company due to the lack of ethical standards.

He didn’t have time to think about that at the beginning and now that the company is large it is difficult to implement them. He hired a consultant to help him along the process and together they defined four core values, which are: transparency, punctuality, excellence and honesty. These principles helped the business to increase the healthiness of the work environment and reduced the number of conflicts experienced with both customers and suppliers.

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