The corporate code of conduct has been thrust into prominence by its role as the platform from which many prominent corporate leaders have been terminated because of allegations of egregious personal behavior. With that prominence has come concerns that the code is in fact a flawed means of evaluating conduct—that it is fundamentally a general statement of expectations, and was never intended to be used for such consequential purposes.

The board should confront those concerns by reviewing the suitability of the code as an educational and enforcement vehicle. It is critical that corporations have the ability to punish aberrant employee and leadership behavior. Codes of ethics and conduct are key tools by which the board can exercise its oversight responsibility for workforce culture and, by extension, promote talent development and protect the corporate reputation. Addressing possible code weaknesses is consistent with this oversight duty.