Ethics

Procter & Gamble prides themselves on being an ethical company.  They are not a business that comes to mind when thinking of ethical controversies that arise in the media.  Purpose, values, and principles are what lead Procter & Gamble employees through their work weeks.

 "Our Purpose unifies us in a common cause and growth 

strategy of improving more consumers’ lives in small but meaningful ways each day. 

It inspires us to make a positive contribution every day.  

Our Values reflect the behaviors that shape the tone of how we work with
each other and with our partners.  Our Principles articulate our unique 

approach to doing our work."

Their Worldwide Business Manual covers every aspect of ethics in the work place, how to report them, and expectations of employees and their behavior.  They say"[o]ur character has been built on the foundation of integrity, trust, and respect since our beginning in 1837."

The Organizational Structure

P&G's organizational structure is difficult to define because it does not perfectly match the book's options.  They have a form of divisional structure that allows them to think globally and act locally.    

Procter & Gamble have 2 Global Business Units that "focus solely on consumers, brands, and competitors around the world" (P&G.com).  The Market Development Organizations are responsible for knowing what the consumers want and what the competitors are doing in each segment of their business.  The Global Business Services provides business support services.  The Corporate Functions "ensure ongoing functional innovation and capability improvement" (P&G.com).  The main goal of this structure is to eliminate inefficiencies that are often present within large companies.

Corporate Governance

Directly from the Procter & Gamble website, "Corporate Governance is the interaction of the management, shareholders and Board of Directors to help ensure that all investors—both shareholders and creditors—are protected against managers acting solely in their own best interest."  P&G takes corporate governance very seriously, they have noticed that corporate governance is most successful when management acts as long-term investors in the company.  


One way that P&G promotes corporate governance among its employees is through their retirement plans.  Each employee's plan consists of P&G stock which creates a sense of ownership for the employees.  Corporate executives are required to hold P&G stock valued in reference to their base salary.  These two economic tools help to align the interests of employees, executives, and directs with the economic interests of the company.  


P&G employees make all decisions in the workplace based on Purpose, Values, and Principles.  There is a strong internal control environment in place that is monitored by audit and self assessment.  This measure ensures integrity among employees.  Every employee is required to be trained on the Company’s Worldwide Business Conduct Manual.  P&G prides itself on corporate governance and takes it seriously as it is easily seen through these examples.