Evaluating Ethical Conduct in Eli Lilly's Financial Management

The assignment delves into the ethical code followed by Eli Lilly Company’s financial managers, highlighting key principles such as integrity, objectivity, professional competency, confidentiality, and professional behavior. It argues that while comprehensive, the company's ethical framework could benefit from clarity on disciplinary consequences for breaches and decision-making processes in ethical dilemmas. The analysis compares these standards with Starbucks Coffee Company, noting both similarities like the emphasis on honesty and regulatory compliance and differences such as reporting mechanisms for fraudulent activities. This evaluation underscores the importance of robust ethical codes in safeguarding stakeholder interests and enhancing corporate goodwill.

Ethical Conduct for Financial Management

Analyzing the Comprehensiveness of Organizational Ethical Code
The Code of Ethics of Eli Lilly and Company for financial leaders has stated the
ethical principles that they should follow for carrying out their roles and responsibilities. As
per the international code of ethics, there are five fundamental principles that the financial
leaders need to comply as follows:
 Integrity: The financial leaders must carry out their roles in an honest manner for
developing the professional relationships
 Objectivity: The decisions taken by the financial leaders should be unbiased without
having any influence of outside parties
 Professional Competency: The financial leaders must posses required skills set and
competencies for ensuring that the clients receive competent professional services.
The professional competency is required so that financial leaders carry out their
responsibilities in due diligence and as per the technical and professional standards
(International federation of Accountants, 2017).
 Confidentiality: The financial leaders also hold the responsibility of protecting the
confidential information of their entity so that it cannot be accessed by outside parties
for unethical purposes.
 Professional Behavior: The financial leaders should comply with the required laws
and regulations for carrying out their roles as per the professional standards
(McMillan, 2012).
Thus, as per this standard code of ethics, the Eli Lilly and company financial management
code can be regarded to be comprehensive. The code of ethics of the company has stated that
the financial leaders should act with integrity, objectivity, confidentiality, and competency
and as per the standard professional behavior. The code of ethics of the company has
advocated that it is dedicated to achieve highest standards of corporate conduct that are based
on its core values and ethical principles. The Red Book Code of Business Conduct has
determined the ethical framework that the company follows for carrying out its business
activities . However, the code of ethics of financial management of the company lacks the
consequences that the financial managers will face for breach of this code of conduct. The
actions that the company will take over the disciplinary matter arising due to violation of the
above code are not provided in the company code of ethics. Also, the code of conduct does
not state the procedures to be followed while taking decisions in the situations relating to
ethical dilemma (International federation of Accountants, 2017).
The ethical principles undertaken by the company for maintaining the privacy of
employees faced with violations charges is also indicated in the ethical standards. Also, the
ethical code followed by the company for maintaining the confidentiality of employees
reporting the possible violations is also not stated in its mentioned code of ethics. The
company should also develop ethical codes that promote open communication and interaction
between all its financial managers and leaders about any ethical issues for ensuring the
successful adoption of ethical standards (International federation of Accountants, 2017). This
is necessary for enhancing co-operation between all the financial leaders of the company so

that they act in due diligence. In addition to this, there are some ethical codes of the company
that needs clarification such as specifying the respective legal rules and laws within which the
financial leaders of the company works and carry out their roles (Eli Lily and Company,
2014).
Comparison of Eli and Lily Company Ethical Code with Other Organization Code
Similar to the code of ethics for financial management of Eli and Lily Company, the
Starbucks Coffee Company has also stated its code of ethics for the financial leaders. There
are many similarities and differences in the code of ethics of both the companies. The
similarities are advocating the use of honesty and integrity in carrying out the roles and
responsibilities is mentioned in both companies’ codes. Both the companies have regarded
the compliance of their financial leaders with the governmental laws and rules in carrying out
their job responsibilities. Also, the financial leaders of both the companies comply with the
ethical code of providing fair, accurate and understandable information as per the objectivity
fundamental principle of ethical accounting practices (Eli Lily and Company, 2014). The
financial leaders of both the companies have undertaken the obligations of protecting the
confidentiality of information they posses for carrying out their work duties. Also, they have
undertaken the obligations to promote the ethical behavior in the work environment for
developing an internal control over the internal business processes and activities. The
financial leaders of both the companies also seek to carry out their work responsibilities with
utmost care, competence, diligence to avoid any mis-representation of material facts and
figures in order to protect the stakeholder interests (Code of Ethics for CEO, COO, CFO and
Finance Leaders, 2017).
There also some differences identified in the ethical code for financial management of
both the companies. The differences are Starbucks code has not stated the ethical codes for
reporting the fraudulent activities. Also, like Lilly’s code of business conduct stated in ‘The
Red Book’, the Starbucks standards of business conducts are reported in its annual reports.
The noted differences exist as per the nature of business operations of both the companies
and thus they have developed and implemented the ethical codes that help them to improve
their quality of their respective business procedures (Code of Ethics for CEO, COO, CFO and
Finance Leaders, 2017). Thus, it can be said after examining the code of ethics of Eli and Lily
Company that development and implementation of effective financial code of ethics is
necessary for every business entity. This is because the code of ethics implementation will
ensure that all the financial business actions are taken as per the ethical principles that help in
promoting the transparency of business operations among the stakeholders. The compliance
with the ethical codes will help in protecting the interests of all the stakeholders and thus
helps in maximization of their value. This in turn will lead to strengthening of goodwill of the
company across the world and thus helping it to improve its productivity and profitability
(International federation of Accountants, 2017).

References
Code of Ethics for CEO, COO, CFO and Finance Leaders. 2017. Retrieved 25 October, 2017,
from:
https://globalassets.starbucks.com/assets/a626d16b18b74e209e4672b5829e274c.pdf
[Accessed on: 25 October 2017].
Eli Lily and Company. 2014. Code of ethical conduct for financial management. Retrieved
25 October, 2017, from: https://www.lilly.com/about/business-practices/ethics-
compliance/code-of-conduct/code-of-conduct-financial-management.aspx
International federation of Accountants. 2017. Retrieved 25 October, 2017, from:
https://www.ifac.org/global-knowledge-gateway/ethics/discussion/ethical-leadership-
and-developing-code-conduct
McMillan, M. 2012. Codes of Ethics: If You Adopt One, Will They Behave? Retrieved 25
October, 2017, from: https://blogs.cfainstitute.org/investor/2012/02/20/codes-of-
ethics-if-you-adopt-one-will-they-behave/