Key steps for SME success

Ethical business practices are essential for any Canadian company operating at home or internationally. Fortunately, there are basic steps you can take to build a good ethical foundation. Use the checklist below to get started or improve your current practices.


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Step 1 

Assign responsibility

Who in your company is in charge of ethics? 

  • To ensure accountability and buy-in, appoint a senior figure to handle ethical aspects of the business. This could be the company owner if there isn’t sufficient staff or resources. 


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Step 2 

Identify ethical issues

Are you familiar with the full range of ethical matters relevant to your business?

  • Consider ethical risks in your workplace and employee interactions with clients.  
  • Consider those outside your company. How well do you know your agents, partners, customers and suppliers? Are there potential ethics-related impacts on communities you serve? 
  • Check your legal obligations in the markets where you do business, or plan to expand.  
  • Determine if the countries where you operate present a high-risk exposure. Corruption, for instance, is a financial crime and a significant risk in many global markets; your company could become involved without even knowing it. 



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Step 3 

Create a code of conduct

Does your company have a code of conduct (also known as a code of ethics)? 

  • Get buy-in from management to create a code of conduct.  
  • Develop the code. It should reflect your business context, and clearly define your standards, the values most important to your company, and your expectations for how employees should act in any given situation. Consider engaging management and employees to help shape the code. The code isn’t just for your workforce; it should also apply to all suppliers, agents and partners. 
  • Common elements of a code include: 

* A strong message from leadership on the code’s purpose 

* Company values and ethical priorities 

* Statements or commitments on ethical matters relevant to your business  

* Guides and rules for employees, including how to handle conflicts of interest and appropriate actions to take if they encounter ethical violations

  • The code can be published as its own document and/or integrated into other governance documents such as employee or supplier contracts.



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Step 4

Put your commitment into practice

How will you operationalize your code and ethical principles?

  • Put procedures and systems in place to guide ethical behaviour and mitigate risks of non-compliance. 
  • Ensure your leaders set the “tone at the top” and act as role models to reflect the ethical values of your business. 
  • Educate and train your employees about your code—when they join the company and on an ongoing basis. Make sure everyone has a copy. Include training on employee responsibilities and how to solve ethical dilemmas. This will help ensure everyone understands the appropriate actions.  
  • Educate all other relevant parties, including suppliers and business partners, about your code of conduct.  
  • Monitor compliance with your code and the laws applicable to your business.



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Step 5

Establish a process to address ethical concerns

Do you provide employees, customers and other stakeholders with options for reporting unethical behaviour confidentially? How do you resolve violations of your company code of conduct? 

  • Establish a “whistleblowing channel” such as a hotline or web form. It’s important that employees, customers and other stakeholders can bring issues related to your code and other ethical matters to your attention.  
  • Educate, publicize and make the whistleblowing channel accessible to stakeholders. Make sure protections are in place to protect whistleblowers who spot and report issues. 
  • Create plans to respond to any negative ethical impacts your company may cause or contribute to as a result of business relationships with other parties.  
  • Consider remediation in the event of ethics violations that impact people. Hold suppliers/partners accountable for any resolutions required on their end. 


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Date modified: 2024-02-15