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printed by The National Survey of CEOs on Business Ethics Hired new staff or restructured organization responsible for ethics and compliance Have the recent changes in regulations regarding ethics and governance (i.e., the Sarbanes-Oxley Act, the updated Federal Sentencing Guidelines, revised listing requirements of stock exchanges, etc.) affected how your organization manages ethics and compliance? Of those who said yes, what did they do? Updated ethics or compliance policiesRevised mission, vision or values statements Created new ethics/compliance committeesDeveloped new communication strategies for managing conduct Increased budget for ethics and compliance management Created or strengthened ethics and compliance training

printed by The National Survey of CEOs on Business Ethics A stated ethics policy (e.g., Code of Ethical Conduct)? Do you have or plan to implement in the next 12 months… A board level committee responsible for ethics and compliance?An ethics and compliance training program? A company ethics helpline (e.g., to report concerns)?A statement of values to guide corporate conduct? An assigned ethics and/or compliance officer? A department that is primarily responsible for ethics and compliance? Percent Provide positive guidance for employee conduct 50.8% Ensure legal compliance 21.2% Be socially responsible 16.2% Improve/protect public reputation 5.8% Improve profits/shareholder value 4.6% Motivate employees 1.2% Retain employees 0.4% Total 100.0% If you answered yes to any item above... What is the single most important motivation for implementing an ethics initiative within your firm?

printed by The National Survey of CEOs on Business Ethics How important are these factors for explaining unethical conduct in most organizations?

printed by The National Survey of CEOs on Business Ethics In your judgment, how do high ethical standards affect a company’s competitive position? … in the short term … in the long term CEOs who thought high ethical standards strengthened a company’s position were not significantly more positive about regulation, than those who thought high standards weakened or had no effect. StrengthenWeakened or had no effect Agree51.8%53.6% Disagree48.2%46.4% “The Sarbanes-Oxley Act and related regulatory measures have improved the standard of ethical performance of corporate America” “The Sarbanes-Oxley Act and related regulatory measures have improved the standard of ethical performance of my business” StrengthenWeakened or had no effect Agree21.1%17.6% Disagree78.9%82.4% “The Sarbanes-Oxley Act and related regulatory measures have strengthened public and investor trust in corporate America” “The Sarbanes-Oxley Act and related regulatory measures were an overreaction to the ethical failures of a handful of companies and have proven to be burdensome and unnecessary for most good companies” StrengthenWeakened or had no effect Agree51.8%53.6% Disagree48.2%46.4% StrengthenWeakened or had no effect Agree47.4%44.6% Disagree52.6%55.4% CEOs who agreed that the ethical performance of corporate America has improved over the last 4 years were significantly* more positive about regulation, than those who felt it had not improved. “The Sarbanes-Oxley Act and related regulatory measures have improved the standard of ethical performance of corporate America” * Significant p<.01 Agreed improved Disagreed not improved Agree51.8%53.6% Disagree48.2%46.4% “The Sarbanes-Oxley Act and related regulatory measures have improved the standard of ethical performance of my business” * Significant p<.01 Agreed improved Disagreed not improved Agree26.3%11.1% Disagree73.7%88.9% “The Sarbanes-Oxley Act and related regulatory measures have strengthened public and investor trust in corporate America” * Significant p<.01 Agreed improved Disagreed not improved Agree61.9%24.1% Disagree38.1%75.9% “The Sarbanes-Oxley Act and related regulatory measures were an overreaction to the ethical failures of a handful of companies and have proven to be burdensome and unnecessary for most good companies” * Not statistically significant Agreed improved Disagreed not improved Agree67.7%75.6% Disagree32.3%24.4% CEOs who thought high ethical standards strengthened a company’s position were not significantly less likely to think that internal corporate pressures lead to unethical conduct, than those who thought high standards weakened or had no effect. * Not statistically Significant StrengthenWeakened or had no effect Not important35.1%39.2% Neutral31.9%31.6% Very important33.0%29.1% “How important is pressure to meet deadlines and schedules for explaining unethical conduct among employees at most organizations?” “How important is pressure to meet unrealistic performance or financial goals for explaining unethical conduct among employees at most organizations?” * Not statistically Significant StrengthenWeakened or had no effect Not important49.2%50.6% Neutral23.8%18.5% Very important26.9%30.9% CEOs who thought high ethical standards strengthened a company’s position were significantly less likely to think that broad economic pressures lead to unethical conduct, than those who thought high standards weakened or had no effect. “Business executives are more likely to make ethical compromises during economic downturns” * Significant p<.05 StrengthenWeakened or had no effect Agree52.8%65.8% Disagree47.2%34.2%

printed by The National Survey of CEOs on Business Ethics CEOs’ Roles and Compensation: Differences* between CEOs in publicly held and private firms CEOs in privately held organizations more likely to agree: Public companies' responsibilities to employees frequently conflict with their need to maximize shareholder returns. CEOs in privately held organizations more likely to agree: My standard of business ethics has improved over the course of my career. CEOs in privately held organizations more likely to agree: CEO compensation in most large public companies is excessive. CEOs in privately held organizations more likely to disagree: CEO compensation in most large public companies is properly aligned with corporate performance. Differences* by number of employees (small under 100, medium 101 to 1000, large 1001 or more) CEOs in mall and medium sized (under 1000 employees) more likely to agree: Public companies' responsibilities to employees frequently conflict with their need to maximize CEOs in small and medium sized (under 1000 employees) more likely to agree: My standard of business ethics has improved over the course of my career. Difference* by annual sales (small under $50 million, medium $50 million to $250 million, large over $250 million) Difference between small, medium and large—smaller more like to agree: Public companies' responsibilities to employees frequently conflict with their need to maximize Difference between small, medium and large—smaller more like to agree: My standard of business ethics has improved over the course of my career. Difference between small, medium and large—smaller more like to agree: CEO compensation in most large public companies is excessive. * statistically significant with p <.05 Do you agree or disagree with the following statements? Strongly agree AgreeDisagreeStrongly disagree Q11a The CEO should be the moral leader of the organization85.8%11.3%0.3%0.0% q11b Public companies' responsibilities to employees frequently conflict with their need to maximize shareholder returns.5.3%37.0%37.4%20.4% q11e My standard of business ethics has improved over the course of my career.26.5%38.1%24.4%11.0% q11f It can be appropriate for CEOs' religious beliefs to influence their business decisions.20.6%37.5%19.5%22.4% q11g There is a generally accepted ethical standard that most businesspeople agree and act upon.8.5%61.3%25.0%5.3% Q11h CEO compensation in most large public companies is excessive.23.8%39.1%30.1%7.0% q11i CEO compensation in most large public companies is properly aligned with corporate performance.1.2%28.3%48.2%22.3%

printed by The National Survey of CEOs on Business Ethics 1) What are the top 5 ethical issues facing the general business community? 2) What are the top 5 ethical issues facing your industry? 1) Ranked by concern in general business community One of 5 top concerns for… general business community your industry Improper accounting practices44.0%24.5% Lying on reports/falsifying records35.4%31.8% Conflicts of interest35.4%45.0% Exorbitant executive compensation33.8%2.6% Dishonesty with customers30.5%31.1% Misleading the public or the media29.8%18.9% Deceptive sales practices28.8%33.4% Violating environmental regulations27.8%19.5% Stealing/theft24.2%31.1% Producing low quality or unsafe products22.2%19.5% Bribes and kickbacks21.2%15.2% Drug/alcohol abuse20.2%24.5% Discrimination19.5%15.2% Unfair treatment of employees18.9%18.2% Sex harassment12.6%15.9% Violations of privacy11.9%24.5% Unfair treatment of suppliers10.9%13.6% Lying/exaggerating on resumes or job applications10.6%16.6% Economic espionage/divulging trade secrets7.6%9.9% Predatory employment practices2.6%9.9% Workplace violence1.7%3.3% Other1.7%3.3% 2) Ranked by concern in own industry One of 5 top concerns for… your industrygeneral business community Conflicts of interest45.0%35.4% Deceptive sales practices33.4%28.8% Lying on reports/falsifying records31.8%35.4% Dishonesty with customers31.1%30.5% Stealing/theft31.1%24.2% Improper accounting practices24.5%44.0% Drug/alcohol abuse24.5%20.2% Violations of privacy24.5%11.9% Violating environmental regulations19.5%27.8% Producing low quality or unsafe products19.5%22.2% Misleading the public or the media18.9%29.8% Unfair treatment of employees18.2%18.9% Lying/exaggerating on resumes or job applications16.6%10.6% Sex harassment15.9%12.6% Bribes and kickbacks15.2%21.2% Discrimination15.2%19.5% Unfair treatment of suppliers13.6%10.9% Economic espionage/divulging trade secrets9.9%7.6% Predatory employment practices9.9%2.6% Workplace violence3.3%1.7% Other3.3%1.7% Exorbitant executive compensation2.6%33.8%

printed by The National Survey of CEOs on Business Ethics Do you agree or disagree? The criminal convictions of Kenneth Lay, Jeffrey Skilling, Bernard Ebbers and other corporate leaders….. Percent agree...show that the system works.65.6%...make corporate leaders more attentive to ethics.88.0%...further erode public trusts and confidence in business leaders.66.0%...help restore public trusts and confidence in the financial markets.44.5%...reinforce a negative and unfair stereotype of CEOs.65.1%...encourage even more legal scrutiny and regulation of business.88.6% No statistically significant differences by number of employees, annual sales or whether organization is publicly or privately held. Some differences, however, by industry: 76.8% of manufacturing CEOs agreed “it showed the system works.” 82.1% of healthcare and non-profit CEOs agreed “further erodes public trust and confidence in business leaders” only 76.9% of banking, finance and insurance CEOs agreed “makes corporate leaders more attentive to ethics” only 34.5% of healthcare and non-profit CEOs agreed “helps restore public trust and confidence in the financial markets.” 76.5% of information technology CEOs agreed “reinforces a negative and unfair stereotype of CEOs.” only 72.7% of professional and technical service CEOs agreed “encourages even more legal scrutiny and regulation of business.”

printed by The National Survey of CEOs on Business Ethics To what extent do you agree or disagree? “University business schools should require courses in business ethics and/or ethics components in other business courses.” However, CEOs who believe that business schools have a greater role to play are not doing all that much more in their own organizations in terms of ethics management. Comparing CEOs who “strongly agreed” that university business schools should require ethics courses and/or ethics components to all other CEOs the differences in the ethics policies, practices and procedures are slight. “University business schools should require courses in business ethics and/or ethics components in other business courses.” Strongly agree All other responses A board-level committee responsible for ethics and compliance? Yes 41.3%33.5% No 58.7%66.5% An ethics and compliance training program? Yes 55.7%51.6% No 44.3%48.4% A company ethics "help line" (e.g., where employees may report ethical concerns or seek guidance on ethical questions)? Yes 59.2%48.8% No 40.8%51.3% A stated ethics policy (e.g., Code of Ethical Conduct)?* Yes 88.6%79.4% No 11.4%20.6% A statement of values to guide corporate conduct? Yes 86.2%82.4% No 13.8%17.6% An assigned ethics and/or compliance officer? Yes 55.4%43.5% No 44.6%56.5% A department that is primarily responsible for ethics and compliance (i.e., education, investigations and monitoring)? Yes 48.8%39.4% No 51.2%60.6% * p <.05

printed by The National Survey of CEOs on Business Ethics Demographics of the National Survey of CEOs sample FrequencyPercent Manufacturing Healthcare and social assistance Banking, finance and insurance Construction Professional and technical services Information services and technology Utilities Wholesale trade Retail trade Transportation and arehousing 72.4 Hotel, entertainment and food services 62.0 Real estate, rental and leasing 51.7 Other, non services 51.7 Agriculture, forestry and fishing 31.0 Other services 31.0 Total % Industry Number of Employees Annual Sales Percent publicly owned

printed by ROBERT J. RUTLAND INSTITUTE FOR ETHICS …The programs and activities of the Rutland Institute for Ethics are multidisciplinary and are intended to benefit both the campus and the community. Campus activities focus on three groups: students, faculty and staff. Community programs are designed to reach as much of the community as possible, with special attention directed to the business, education and professional sectors. The principal academic partner of the Rutland Institute is the Clemson University Department of Philosophy & Religion…. “From it’s inception as a military institution, Clemson has been recognized widely for the strong sense of character developed in its graduates. The Rutland Ethics Across the Campus program compliments and formalizes this long-standing Clemson commitment.” ~James F. Barker, FAIA--President, Clemson University Main Office Phone: ~ Fax: The Robert J. Rutland Institute for Ethics 126D Hardin Hall ~ Clemson University ~ Clemson, SC Dr. Daniel E. Wueste, Director Linda Gallicchio, Associate Director

printed by Mailing Address The Center for Ethics and Corporate Responsibility P.O. Box 3994 Atlanta, GA Physical Address The Center for Ethics and Corporate Responsibility 34 Broad St., 14 th floor Atlanta, Georgia Phone Dr. John Knapp, Director Dr. Steven Olson, Associate Director

printed by In keeping with Clemson University’s core values and aspiration to be a Top-20 public university, the Clemson Renaissance Center in downtown Greenville — a unit of Clemson’s College of Business and Behavioral Science — will be the center for entrepreneurship, experience-based graduate education and a portal to the dynamic Greenville business community. The Center will enable graduate students and faculty to work directly with area firms, entrepreneurs and leaders in innovative ways that will both enrich and accelerate the learning experience of all. By 2015, the Renaissance Center will be recognized nationally as a model for total immersion graduate education based on its innovative programs, the students it attracts, the graduates it produces and its interaction with the business world. By then, the Center’s entrepreneurship-enriched MBA will be emerging as one of the nation’s leading entrepreneurship degree programs. 135 South Main Street, Ste 600 Greenville, SC Phone (864) ~ Fax (864) Caron St. John, Associate Dean for Graduate Programs & Innovation Pris Foster, Administrative Coordinator

printed by Robert J. Rutland Institute for Ethics The Center for Academic Integrity provides a forum to identify, affirm, and promote the values of academic integrity among students, faculty, teachers and administrators. The Center for Academic Integrity is affiliated with the Robert J. Rutland Institute for Ethics at Clemson University in Clemson, South Carolina. CAI is a consortium of over 360 institutions who share with peers and colleagues the Center's collective experience, expertise, and creative energy. Main Office Phone: Fax: Mailing Address: The Center For Academic Integrity 126 Hardin Hall ~ Clemson University Clemson, SC Dr. Stephen Satris, Director