The Institute of Directors (IoD) plans to introduce a voluntary Code of Conduct for directors to enhance integrity and transparency in business. This code outlines good conduct and is a practical tool to help directors make better decisions without creating additional compliance burdens. It is built around six key principles:
- Leading by example: Directors should demonstrate exemplary personal conduct and decision-making, avoiding behaviours that could harm the organisation's reputation or contradict its values.
- Integrity: Directors must act honestly, adhere to strong ethical values, and do the right thing. They should be vigilant about conflicts of interest, manage them appropriately, and voice constructive challenges and disagreements on matters of concern.
- Transparency: Directors should communicate, act, and make decisions openly, honestly, and clearly. They should foster a business culture that does not conceal wrong-doing or mistakes
- Accountability: Directors must take personal responsibility for their actions and their consequences. They should comply with the organisation's legal duties and hold management accountable.
- Fairness: Directors should treat people equitably, without discrimination or bias, and make decisions based on objective evidence.
- Responsible business: Directors should integrate ethical and sustainable practices into business decisions, considering societal and environmental impacts. They should avoid prioritising the short-term financial interests of shareholders over the long-term interests of the organisation.
This Code of Conduct aims to guide directors in embodying these principles, thus fostering a culture of integrity, transparency, and accountability within their organisations.
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