The development of a conceptual framework of corporate ethics in total quality management (TQM) is presented by a case description. The case description illustrates the evolution of management versus employee expectations and perceptions of corporate ethics. Four parameters of corporate ethics are used to incorporate ethics into TQM, namely management versus employee expectations and perceptions. The case description shows that TQM may be running well and accomplishing the hard goals. It is a business approach that should penetrate all activities inside and outside that are related to the company, including the soft issues.