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| Code of Ethics for Business |
| Adopted on 19th February, 1982. |
| Preamble |
A concept of social responsibility and
ethical conduct is inherent in every stable society.
Business ethics do not merely refer to laws that govern commercial
activity. Business activity is regulated by a series of laws and regulations
framed by the state, just as much as political activity is governed
by the constitution of the State. Business must obey the laws and
regulations, or run the risk of suffering the penalties that may be
imposed for their disobedience. The concept of ethical behaviour however
goes beyond the activity of mere compliance with the law. Business
ethics in large measure deal with the spirit in which commercial transactions
are conducted and in particular with the effect they may have on consumers
and the public in general.
The main reason for the existence of a commercial organization is
to produce and market goods or services which satisfy both the needs
of its customers and the needs of the commercial organization, in
terms of an adequate return on investment, taking into account the
risks undertaken. There can also be no dispute that its first responsibility
is to be profitable. This is essential not only for the owners but
also for the livelihood and security of its employees.
The Ceylon Chamber of Commerce believes that these aims can be best
achieved in a free enterprise system and in a market economy which
allows free enterprise reasonable scope. A successful and respected
Private Sector is an essential prerequisite to the future development
of the country. We therefore believe that business has an obligation
to advance and promote the principles, not only of economic freedom
but of economic growth, national development and social progress.
As businessmen who are members of the Ceylon Chamber of Commerce,
we therefore accept our commitment of the following basic obligations: |
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| We also accept that at different times
the commercial organization may be required to give priority to the
interests of one or other of the groups involved in, or affected by,
its activities in preference to others. We recognise that in the long
term, however, a commercial organization must strike a fair balance
so that the interests of all groups are taken into account and no
group is improperly neglected. |
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| A. Obligation
to our Customers |
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1. The
product and its quality |
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(a) |
To ensure that in designing
and manufacturing products and in providing consumer
services we take every precaution to protect the
health and safety of consumers and avoid harmful
side effects on the environment. |
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(b) |
To utilize advancing technology to
produce goods that meet high standards of quality
at a reasonable price. |
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(c) |
To ensure that all products that
are marketed have been subject to quality control. |
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2. Packaging |
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(a) |
To ensure that consumer
products are adequately packaged so that the contents
do not deteriorate or spill or leak, or cause injury
in handling, in transit, on display, or in use. |
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(b) |
To avoid the use of deceptive packaging
which is designed to misrepresent the nature, quantity
or quality of product offered. |
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(c) |
To list ingredients that may cause
harmful side effects to users, with the necessary
details, and to state the name and country of the
manufacturer. |
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(d) |
Where necessary, to provide precise instructions
for product use, including suitable warnings where
any special care should be taken. |
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3. Sales
and Services |
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(a) |
To eliminate frauds and
deceptions from the marketplace, abide by the law
and carry out agreements concluded in good faith,
setting as our goal not strict legality but honesty
in all transactions. |
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(b) |
To honour product warranties and
guarantees and arrange for satisfactory services
and repairs. |
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(c) |
If sub-standard goods are offered
for sale, to inform the consumer of this in advance
and also to replace or compensate for defective
goods in that inadvertently reach the consumer’s
hands. |
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(d) |
To designate a responsible officer
of the business to investigate and deal with consumer
complaints. |
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(e) |
To take all reasonable
steps to make the consumer and the trade aware of
the maximum retail prices of products marketed. |
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(f) |
To make known to consumers in advance extra charges
such as for delivery or installation and to refrain
from concealing these from the consumer until after
the sale is concluded. |
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4. Advertising
and Promotion |
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(a) |
To accept that whilst
the business has a legitimate right to use its skills
to increase the sales of its products and to expand
the market, it should not make unfair use of pricing
or of consumer or trade promotions for the sole
purpose of eliminating competitors. |
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(b) |
To avoid the use of improper, exaggerated,
or misleading advertising claims. If superiority
is claimed over competitive products or services
in any particular aspect of product or service,
the advertiser should be in a position to demonstrate
this superiority through research. |
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| General |
| To observe, abide by and follow, in principle
as well as in spirit, all laws, regulations and codes directly
or indirectly applicable to products and services, manufactured,
provided or marketed as the case may be. |
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| B. Obligation
to the Owners of Our Business |
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(1) |
To recognize that the owners of
a business are entitled to expect that the business earns a
reasonable level of profit and that directors of a company should
at all times be conscious of the fact that the company and therefore
its profits, belong to the shareholders. Expansion and diversification
should therefore not be at the expense of reasonable, current
cash dividends. It should also be accepted that undistributed
profits should be capitalized at necessary intervals to the
maximum extent possible and that shareholders should also be
compensated for inflation by regular revaluation of assets followed
by capitalization of the reserves created thereby. |
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(2) |
That Directors should not use inside
knowledge (which is not available to shareholders) for their
personal enrichment; they should avoid share transactions that
would be considered ‘insider trading’ in developed
countries. |
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(3) |
To always consider, in the event of a dispute,
alternative methods of dispute resolution and to resort to mediation
and/or arbitration, prior to litigation, as a means of resolving
disputes and to utilize to the extent possible, and the mediation
and arbitration services provided by the Chamber for such purpose. |
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| C. Obligations
to Our Employees |
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(1) |
To make available to its employees
at least the minimum wages and other facilities stipulated by
the Government for employees in that particular trade. These
minimum standards should not be circumvented through the use
of legal loopholes. |
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(2) |
To recruit or employ and promote
its employees on the basis of their qualifications, irrespective
of differences in race, sex, religion or politics. |
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(3) |
To encourage employees to achieve
self development in their working careers by furthering their
education, skills and training. |
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(4) |
To ensure that adequate health and
safety precautions are provided in their work and workplace,
so that employees are not exposed to hazards to their health
and safety. |
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(5) |
To treat all employees, irrespective
of their position in the business, with respect as human beings
and not to subject them to any indignities. |
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| D. Obligations
to Society |
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(1) |
To be a good citizen and to play
a positive role in the community from which we draw both our
employees and our customers. |
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(2) |
To operate as far as possible according
to the national economic and social goals and policies and,
by doing so, contribute to employment, increased living standards
and the solution of social problems that arise from changing
environment and technology. |
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(3) |
To avoid rash and speculative trading
that can cause losses in foreign exchange and possibly damage
the reputation of the country through defaults. |
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(4) |
To support business activities that
will encourage the acceptance by society of the principles of
private enterprise and wider share ownership and thereby help
to promote the further growth of a responsible and successful
private sector. |
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(5) |
To take adequate precautions to
ensure that manufacturing processes do not cause serious and
irreversible harm or damage to the natural environment. |
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| Implementation |
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(1) |
To comply with the Code of Ethics
both in the letter and in the spirit. |
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(2) |
To accept that where there is evidence
of non-compliance with the Code of Ethics, the Chamber may hold
an inquiry and where violation of the Code is established, to
also accept that action may be taken by the Chamber Committee
in relation to each violation in the form of admonition to comply
in the future, or warning or suspension, or even expulsion as
the Chamber Committee may deem fit. |
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(3) |
To accept as final and conclusive
such decision of the Chamber Committee. |
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