BUSINESS ETHICS IN PRACTICE Sergejus Muravjovas www transparency

BUSINESS ETHICS IN PRACTICE Sergejus Muravjovas www. transparency. lt

BUSINESS ETHICS AND TRANSPARENCY INITIATIVES Promotion of Business Ethics Principles in the Baltic Region (2006 -2008) [ TI Lithuania, TI Sweden, TI Latvia, SIDA ] “More Integral Medical Treatment” study (2007) [ TI Lithuania, Association of Ethical Pharmaceutical Companies, Association of Drug Producers, LR Ministry of Health, Union of Lithuanian Doctors ] Transparency in Construction Sector Study (2007 -2008) [ TI Lithuania, EIKA, REALTUS, YIT KAUSTA ] “Towards Transparent Media” project (2007) “Promoting Media Accountability” project (2008) [ NORDEN, TI Lithuania ] PARTNERS: SIDA, ECCJ, OECD Watch, TI

How do Lithuanian business people understand business ethics and CSR initiatives? CONDUCTED STUDIES: World Bank (2005) EKT group study (2007) UNDP regional project (2007) TI Lithuania business ethics study (2008) § there are no cultural obstacles § there is no resistance on behalf of employees § do not see any economic enticements § lack state support § do not see initiatives that would support socially responsible business § profit-making is essential – no “win-win” view on business activities § payment of taxes § following the law § securing work safety § employee health care

TI Lithuania business ethics study (2008) Interviews with 20 out top 100 companies in Lithuania, according to the “Verslo žinios” annual company list Carried out in spring – summer of 2008 One-hour-long in-depth interviews with A-level executives Ten questions Funded by Swedish International Development Agency

Q 1: What is your company mission? ¼ business leaders were ready to present and elaborate on their company mission: “To perform construction work with quality and on time. This work has to surpass expectations and last. ” Others stressed the importance of profit: “The aim of the organization is to create profit”, “to earn profit for shareholders and serve good quality products to the customer. ”

Q 2: What are your company values? A good relationship with the customers, employees and environment is the essential value In particular, those who have thought it through Others: Ambitiousness, leveling it with the standards in the society “I would not separate values into those of business and those that are not, they are one and the same. No one has said it better than in the Decalogue”.

The Ten Commandments 1. You shall have no other Gods but me 2. You shall not make for yourself any idol, nor bow down to it or worship it 3. You shall not misuse the name of the Lord your God 4. You shall remember and keep the Sabbath day holy 5. Respect your father and mother 6. You must not kill 7. You must not commit adultery 8. You must not steal 9. You must not give false evidence against your neighbour 10. You must not be envious of your neighbour's goods. You shall not be envious of his house nor his wife, nor anything that belongs to your neighbour

Q 3: What does “ethical business” mean to you? There is no clear or uniform understanding of what “ethical business” is “Ethical business” is keeping your word? ¼ of company representatives pointed out that there are many unethical companies in Lithuania that doing well “When I see companies behaving unethically, I console myself with the thought: “It will come back to haunt them in the future”.

Q 4: Who do you consider to be ethical business leaders in Lithuania? The majority could not provide an immediate answer Six, after some consideration, did not provide any answer All those that look into the future are ethical? Western / Scandinavian-owned companies?

Q 5: What is your opinion about codes of ethics? Only a small number spoke of the Code of Ethics as an integral part of their business identity Codes of ethics are useful when they are followed Many view the Codes with scepticism, not sure how much they are actually followed More than one-fifth of companies do not have a Code of Ethics

Q 6: Does your company use a code of ethics / similar rules? YES: Why? – Top-down, trickled down “umbrella” codes, an essential need How was it developed? – A few speak of a group-driven approach; Disseminated through Internet, newsletters, etc. How does it help solve problems? From “Don’t ask me, it does not help!” to “We have a box for anonymous reports, which is always full; we have our company newspaper. The presence of the Code makes people think – when you have rules written down, they really work like hidden advertisement, and just get imprinted in your consciousness. ”

Q 6: Does your company use a code of ethics / similar rules? NO: Why not? – Not enough time, Power. Point presentation What do you do when there are problems? – The vast majority solve issues through dialogue / discussion How do you explain to employees company culture? – “Since many have such company cultures, when someone misconducts, we do not “throw them away” but talk. ”

Q 7: What is “transparency business” in Lithuania? The majority understand what this should mean Unfair competition “I am amazed of the extent of corruption in Lithuania. To me “transparent” means being open and declaring their interests, particularly when it comes to lobbying. ” “One year and half ago we were declaring our profits and losses but then noticed some negative things. Competitors and providers started to abuse this information and ask us: “Last year you had a profit of 10 million Litas, so aren’t you going to put down the price? ”

Q 8: How do you understand a concept of “win-win”? The majority of business people like the idea but question the extent of applicability in Lithuania “Generally, this is a good thing but there are some exceptions” “The market is not a walk in the park, holding each other hands. If businesses compete with technology and quality of work and the customers receive good quality products, then it’s a win-win. ”

Q 9: What is the future of “transparent” and “ethical” business in Lithuania? “Our situation is not improving…” “There is less strangling in Lithuania nowadays…” “The future is good. It’s all getting sorted out, although when I compare my working environment in an international company to the Lithuanian one… it looks like it got worse…”

THANK YOU FOR YOUR ATTENTION! QUESTIONS? Sergejus Muravjovas www. transparency. lt