The initial step in establishing ethical standards in a business and drafting a code of ethics is which of the following?

• A. Top management commitment.
• B. Development of a code of ethics.
• C. Reinforce ethical behaviors.
• D. Examination of operating standards.

Answer: (D)

Examining operating standards first sets the foundation. By reviewing current policies, procedures, and how decisions are actually made, you establish a clear baseline of what the organization is doing now and where the gaps or risks lie. This step reveals which ethical issues are most relevant, which practices need formal guidance, and what the code of ethics must address to be practical and enforceable. With that understanding, you can craft a code that truly fits the organization, and then secure top management support to implement and reinforce it. The code itself and ongoing reinforcement build on that initial assessment, not replace it.