What is the purpose of a code of ethics?

The purpose of a code of ethics is to clearly state an organization's values and the expected ethical behavior of its employees. This framework helps to cultivate a culture of integrity within the organization, guiding individuals in making decisions that align with the company’s core values. It serves as a critical tool for promoting accountability and establishing standards for behavior that reflect the organization's mission and vision.

A well-crafted code of ethics provides guidance on how to navigate ethical dilemmas and reinforces the organization's commitment to conducting business in an ethical manner. It informs employees, stakeholders, and the public about what is considered acceptable behavior and the principles that the organization upholds, fostering a trustworthy and ethical work environment. This contributes not only to internal cohesion but also enhances the organization's reputation in the broader community.

The other choices do not capture the essence of a code of ethics: outlining company profits pertains to financial aspects rather than ethical considerations; defining a legal framework relates more to compliance with laws rather than moral guidelines; and deterring employees from reporting misconduct contradicts the very purpose of promoting transparency and accountability within an organization.