STATE OF ETHICS AND ETHICAL PRACTICES IN CHEVRON

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STATE OF ETHICS AND ETHICAL PRACTICES IN CHEVRONManaging People at Work (H501)

Submitted to Neaz AhmedProfessor, IBA

Submitted by Saida Kabir ID.19 (47D)Nadia Tabassum Khan ID.28 (47D)Shahriar Kabir Nahid ID.29 (47D)

December 31, 20122

Introduction

• A code of conduct is intended to be a central guide and reference for users in support of day-to-day decision making.

• It is meant to clarify an organization's mission, values and principles, linking them with standards of professional conduct. • An ethical code generally implies documents at three levels: codes of business ethics, codes of conduct for employees, and codes of professional practice.

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Objective

• To understand the outline of the code of ethics of the organization

• To identify the effective communication of the code of ethics to the employees

• To address the areas of employee protection• To learn how employees can be motivated to comply with

the code of ethics• To recognize the impact of the ethical practice on

corporate culture

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Scope

• The selection of the organization, Chevron Bangladesh, enabled us to have a look at a standard code of ethics as the organization is serving worldwide.

• The report was generated based on the opinions given by the HRM personnel of Chevron Bangladesh.

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Limitation

• Due to the company policy, we were restricted from conducting a formal survey on the general employees. Thus no quantitative analysis was made possible.

• The data collection was basically through the HR Personnel that may generate a little biasness on the findings.

• The ethical practice of Chevron may not reflect the overall scenario of the corporate culture of Bangladesh.

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Company Overview - Chevron

• Second-largest integrated energy company in the United States and among the largest corporations in the world.

• Business activities around the world

• Diverse and highly skilled global workforce consists of approximately 61,000 employees, including more than 3,000 service station employees

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Chevron Bangladesh

• Chevron is one of the largest foreign investors in Bangladesh, providing employment and supplying nearly 50 percent of the country's natural gas consumption.

• Producing Natural Gas in Jalalabad

• Delivering Energy Efficiently in Moulavi Bazar • Putting Innovation to Work in Bibiyana

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Vision and Values

• Chevron safely provide energy products vital to sustainable economic progress and human development throughout the world

• They earn the admiration of all our stakeholders — investors, customers, host governments, local communities and their employees.

Key Values - The Chevron Way

•Integrity •Trust•Diversity•Ingenuity •Partnership•Protecting People and the Environment •High Performance

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Ethical Practices at Chevron

• Code of Ethics• Dissemination of Code of Ethics• Application of Code of Ethics• Training on Ethics• Management Support for Ethical Conduct• Reporting Ethical Misconduct• Protection of Employee after Reporting• Monitoring Ethical Misconduct• Disciplinary Methods• Reward System• Updating Ethical Guidelines• Previously Observed Unethical Conduct• Challenges in Enforcing Code Of Ethics• Home Country versus Host Country• Management’s Perception about Code of Ethics• Employee Perception about Code of Ethics

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Code of Ethics

The company has its own code of ethics.

Is it legal?Is it consistent with Company policy, including our Human Rights Policy?Is it consistent with The Chevron Way?If it were made public, would I be comfortable? Four “yes” answers are required to qualify an action as ethical and in step with Chevron’s values.

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Dissemination of Code of Ethics

• In written form prior appointment

• Through Training

• Through regular application of certain guidelines

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Application of Code of Ethics

• Equal application of rules for different level of management

• Investigation is a must• If proven guilty of any misconduct, subsequent punishment

procedure is followed for every employee

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Training on Ethics

• A computer based, ‘Business Conduct and Ethics Code’, training is carried out every year

• Duration of the training is 60 minutes.• It is mandatory for employees of all departments and of all

level of management.• Employees are given a 30days period to go through the

training.• Combined effort of Human Resource department, Finance

department and IC&T (Information, Communication and Technology) department ensures successful completion of this training.

• If anyone fails to do the training within time he/she will be penalized for that.

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Management Support for Ethical Conduct

• Executive leaders of all departments regularly discuss about ethics and the importance of creating an ethical culture in management meetings or other settings.

• Timely and specific guidance from supervisors, managers, the Chevron Law Department, the Corporate Compliance group or local Compliance Coordinator are always available to support the employee.

• Head of Systems, Control and Compliance department act as an in-house ethics advisor for any types of ethical issues.

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Reporting Ethical Misconduct

• Each employee must speak up promptly if there is any reason to suspect that anyone in Chevron or its affiliates has violated Company policies or local laws. We must also report any activity that could damage the Company’s reputation.

• Employee can try to resolve the situation through a discussion with supervisor, local management or local Human Resources business partner.

• Chevron Hotline is also, which operates 24 hours a day, seven days a week.

• Report via hotline will be taken seriously and investigated as appropriate by a third party.

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Protection of Employee after Reporting

• There are no negative consequences to raising concerns in good faith using the hotline

• The Company assures employees that no retaliation will take place.

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Monitoring Ethical Misconduct

• Ethical state of the organization is monitored quarterly.• Human Resource department, Finance (compliance)

department and IC&T (Information, Communication and Technology) department are equally responsible for this monitoring process.

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Disciplinary Methods

• Each of the employees must comply with Code, and with all Company policies.

• Violations of the Code, or the policies referred to in the Code, could result in discipline, including termination of employment and/or criminal prosecution.

• A disciplinary procedure is followed in case of such action• All of these penalizing actions are taken silently.

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Reward System

• The company does not provide any rewards for complying with the codes or performing ethical behavior.

• The organization expects ethical compliance as a prerequisite to work with them.

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Updating Ethical Guidelines

• Ethical guidelines of the organization are updated annually.

• Corporate Management department is responsible for the updates.

• The employees are made informed about these relevant updates through training materials, company bulletin, emails and company’s internal website.

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Previously Observed Unethical Conduct

• Abusing the company resources which include internet abuse, use of customer database for personal gain

• Revealing trade secrets to competitors• Immoral behavior like- negligence at work, passing the

blame, falsifications are never accounted within the organization.

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Challenges in Enforcing Code Of Ethics

• The most frequent challenges faced by the authority in enforcing code of ethics are-

• Making the vast and diverse workforce respectful of the ethical guidelines

• Keeping up with the ethical standards while dealing with external bodies.

• Providing a single, standard guidance for people of different level.

• Ensuring compliance with these standards in order to maintain the trust and reputation among the local and global communities.

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Home Country versus Host Country

• Diversity is a fundamental value at Chevron. As stated in The Chevron Way, this means that

• “We learn from and respect the cultures in which we work.”

• Discrimination is prohibited in hiring, rate of pay, promotion, demotion, transfer, layoff or termination.

• All of the employee must obey the letter and spirit of the law at all times, wherever they live or work.

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Management’s Perception about Code of Ethics

• The management believes that they pursue a stable culture which results from a strong central governance.

• Each and every cases of violation of ethics has been given due importance with proper, extensive investigation in a just way.

• As Chevron enjoys a strong reputation for honesty and integrity throughout the world, they feel that no major initiative should be taken at this point of time to improve their ethical culture.

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Employee Perception about Code of Ethics

• Employees of the organization perceive the code of ethics as a guideline which effectively defines their boundary and which is mandatory for protecting their rights at the work place.

• The code of ethics as well as any update related to it is properly communicated to them.

• They are clearly informed about what to do and what not to do and also the proper channel to report any ethical misconduct.

• They feel protected and proud to be a part of such organization that follows guidelines equally applied for all employees.

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• A code is a tool to encourage discussions of ethics and to improve how employees/members deal with the ethical dilemmas, prejudices and gray areas that are encountered in everyday work.

• Chevron Bangladesh has a sound code of ethics. • The guidelines are strictly followed ensuring harmony

among the organization. • The codes of conduct offer an invaluable opportunity for

Chevron Bangladesh to create a positive public identity for themselves

• An example for other organizations

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Conclusion

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