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A values statement is a set of core beliefs and principles that guides the activities and operations of your company, no matter what its size. To make the statement mean anything, the people at the top of your company must constantly exemplify your stated values, and your company’s incentive and reward systems should direct all employees to act in ways that support your company’s values.

Having a values statement also can keep you and your colleagues on the right side of the law. For decades now the United States, as well as numerous other nations, has legislated statutes regarding product and workplace safety, financial transparency, and environmental issues, to name just a few. In the more recent past, a number of new laws and regulations have been enacted to ensure fairness and equity toward women and minorities in the workplace. Failing to comply can cost you your job. No longer can top-level executives say they don’t really know what’s going on in the companies they run. Now they can be personally held responsible.

Well, you ask, if there are so many laws and ordinances out there to channel the right behavior by the business firm, then what’s the big deal about a values statement? Fair question, as even a cursory review of the legal environment surrounding business would reveal the “grayness” and terminological haze of so many of these statutes. All too often, it seems, our laws are written to allow clever lawyers the wiggle room to slide the perps out of harm’s way (perhaps Shakespeare was right on this issue …). Given this reality, the truly ethical firm shouldn’t seek exoneration under the cover of law, but rather should institutionalize best-practice behavior through its observed actions, especially those taken by the folks at the top of the organizational pyramid. Trust us, lower-down employees will see right through any attempts to sidestep responsibility, and the news will race through their social media accounts faster than answers in a Jeopardy! episode.