1 ETHICS1.1 Defining Ethical Behavior Ethics is a philosophical term derived from the Greek word “ethos” meaning character or custom (Sims, 1992). Ethical behavior is behavior that is morally accepted as good and right, as opposed to bad and wrong (Wood, Zeffane, Fromholtz, & Fitzgerald, 2006). An ethical dilemma requires a person to make a choice between competing sets of principles, based on whether they are moral and right, versus bad and wrong (Wood et al., 2006). While striving to always do good, – with this paradigm – sound ethical conduct will likely become second nature in today's world (Zazaian, 2006).1.2 Ethical behavior in today's modern organizations Today philosopher and theologian Paul Tillich once said: “Ethics is not a subject, it is a life tested in a thousand daily moments” (Lagan, 2006, p. 72). This wisdom is relevant to today's modern organizations that are challenged in every way to meet the high ethical and moral standards demanded by the public for the betterment of society (Kranacher, 2006). Organizations have established codes of conduct to guide their employees regarding their ethical responsibilities while attempting to minimize unethical behavior and resolve ethical dilemmas appropriately (Kranacher, 2006). Unethical behavior, such as lying to important customers and providing insufficient or inaccurate information to shareholders, can lead to poorly informed strategic decisions and problems for organizations (Collins, 2006). One only has to look and reflect on the fate of the major companies HIH Insurance and One Tel, both of which suffered bankruptcies due to their unethical decisions (Wood et al., 2006).2 BEHAVIORAL POLICIES AND PRACTICES ETHICS2.1 Why ethical behavior. ..... middle of document ......The challenge of ethical behavior in organizations. Journal of Business Ethics 11 (7): 505. Verschoor, Curtis C. 2006. The value of an ethical business culture. Strategic Finance 88 (5): 21-3. Von der Embse, Thomas J. and Mayur S. Desai. 2004. Organizational Culture, Ethics and Business Ethics. Information Management and Computer Security 12 (2-3): 146.Wood, Jack, Rachid Zeffane, Michele Fromholtz and Anneke Fitzgerald. 2006. Organizational behavior: basic concepts and applications. Milton: Wiley.Zakak, Alexandra and Steve Douvas. 1999. Insurers need a global ethics policy. Journal of Commerce. New York: newspaper article. Zazaian, Michael. 2006. Contract management and business ethics: a perspective and assessment. Contract Management 46 (6): 24-31. (no author). 1994. The Managers’ Guide. Singapore: World Publication Printers Pte. Ltd..