Ethics and corporate governance: Lessons learned from a financial servicesmodel

To achieve ethical corporate governance, directors' first priority must be to examine their own structure and operation. if the board is vulnerable to charges of unethical conduct, it will have little credibility in its overs ight role over the corporate culture of the organization. An examination of a positive model of corporate governance in the mutual fund industry provi des an effective illustration of several ways to add ethics to corporate go vernance: 1) legislation; 2) jawboning; 3) peer pressure; 4) regulation; 5) training and reflection. While peer pressure and training are more effecti ve than the others, all those methods taken together cannot solve every eth ical lapse. only individual board members, working together, can influence the conduct of the board and propel themselves and the organization towards a standard of continuing ethical excellence.