This week I am examining in a four-part series the issue of business ethics in an attempt to provide practical approaches to business ethics to help build and promote a company’s culture.

As more attention is paid to the importance of an ethical culture, I wanted to first offer some general observations. The field of business ethics is thick with definitions, moral arguments and theoretical discussions, most of which are interesting from an academic perspective. Nor would I ever offer my own ethical principles or moral values as a guidepost for businesses to build an ethical culture. Instead, my approach is to find common ground within a company that aligns company constituencies or stakeholders in order to embed a set of principles and values.

No two companies share the same culture or the same set of company values and principles. Each company is distinct like the products and services the company may provide and the community in which they operate.

First, we start with the obvious assumption – companies need to implement an ethics and compliance program. I have insisted on placing the term “ethics” in front of “compliance” to underscore the point that a company’s ethical culture transcends a company’s legal compliance. If we are to apply rules of statutory construction (I know, which do not apply), the fact is that ethics is more than and separate from legal compliance.

Second, the term “ethics” in the business context applies to business operations involving the purchase and sale of goods and services in the marketplace. In reality, business is hard to separate from many other aspects of our lives so business ethics has a broad application and impact on society, and necessarily reflects our personal values.

Given the vast presence and impact of business ethics, there are numerous important questions that business ethics should address, including the responsibilities of business owners, managers and employees, and external engagement with customers, suppliers, the public, government and communities. It is easy to get lost or twisted up in these esoteric but very important issues.

From my perspective, business ethics is defined as the company’s values and principles guiding its internal operations and relationships with external parties, such as customers, suppliers, government, communities and the public. These ethical principles infuse every aspect of the company’s internal and external operations, and include questions beyond compliance with the law.

We always hear about doing the “right” thing as an ethical principle that requires more than what the law requires – thereby implicating every person’s own moral definition of what is right and what is wrong. Such a definition is too limited in my view.

I look to other principles such as trust and integrity. The term “trust” is predicated on a relationship between employer and employee, and between leaders and followers. Similarly, the term “integrity” suggests more than doing the “right thing” – it encompasses acting towards one another with honesty and truthfulness.

A third principle, fairness, should be considered as a separate and important value. It is something we all demand in life from friends, family and colleagues. Employees look for fairness in their interactions at a company. When fairness is present, the company can build on this foundation to raise ethical performance and conduct.

Each company should define its set of ethical or values to guide its behavior. This is an important process that has to resonate with all relevant stakeholders, including board members, senior management, managers, employees, and shareholders. A company cannot adopt these principles without proper regard for the personal values of its actors – from the employee to the chairperson of the board.

A company’s ethical principles, however, are not up for a democratic vote by its employees, but the principles have to reflect the corporate mission and inspire trust and integrity from all of its actors – these are not inconsistent ideas because individual employees have joined the company for a reason, sometimes in part because of the greater corporate mission, the company’ reputation, and the trust and integrity factor that the employee perceives.

When corporate ethical principles are “aligned,” the crafting of a company’s ethical principles has been successful. The company’s ethical values are properly aligned among leadership, management and employees. The principles reflect a common understanding and buy-in from each of these constituencies. This alignment has to be reinforced by corporate performance, conduct of its leaders, communications and should be subject to measurement and monitoring.

The company’s ethical principles and moral values should be written and communicated in the company’s code of business ethics and conduct. This important document governs business operations and sets forth principles that set standards for accountability.

The company’s defined values govern every aspect of its operations. The code should address the importance of corporate profitability, social responsibility, principles governing day-to-day conduct, as well as the interests of stakeholders such as governments, employees, shareholders, suppliers, communities and customers.