Management decided to post the organization's newly established code of conduct on its website. This decision is primarily intended to mitigate which of the following risks?

Question

Options

• AAccountability risk.
• BCommunication risk.
• CKnowledge risk.
• DCultural risk.

• A
  5% (1)
• B
  5% (1)
• C
  9% (2)
• D
  82% (18)

Explanation

Posting a code of conduct publicly is primarily a cultural intervention - it defines and broadcasts the organization's values, ethical standards, and expected behaviors, signaling to stakeholders, employees, and the public what the organization stands for. This directly mitigates cultural risk: the danger that actual behaviors within the organization diverge from its stated values or ethical norms. Accountability risk (A) is wrong because that concerns unclear roles and oversight structures, not behavioral norms. Communication risk (B) is wrong because it refers to failures in transmitting accurate information, not to shaping conduct standards. Knowledge risk (C) is wrong because it relates to losing critical organizational expertise when key personnel leave - unrelated to a conduct policy.

Memory tip: Think "Code of Conduct = Code of Culture." A code of conduct is essentially a written definition of the culture an organization wants to cultivate and protect.

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