Considering the fact that today's business operation conditions are quite dynamic, uncertain and rapidly changing, it is necessary to develop good business practices, a most of all strengthen the application of business ethics. Business ethics is an integral part of economic practice and a prerequisite of successful business operation in the market. Code of Ethics is defined as a set of core values, moral principles and guidelines which managers and employees should adhere to in their business relationships and decision-making process. There are various views when it comes to the term 'ethics' on the capital market. Some consider it essential, while others find it surprising that ethics and market are mentioned in the same context. Trust, which is essential in business ethics, can be seen on several levels on the capital market, where trust in the market itself and in its political and economic environment comes first. Concern for ethical action and treatment should not be neglected for any reason as it can lead to unfavourable relationships and results of the organization. Lack of business ethics leads to disorders in the normal business flow, both in the environment where the organization is based, and in the wider environment. This paper deals with the theoretical framework of the concept of capital market and its functioning. In addition, a broader concept includes institutions and participants that participate in the capital market in different ways and in different circumstances. The next area of work includes ethics in the capital market, as an extremely sensitive and highly regulated system, which is the target of ever- changing forms of abuse. In the Republic of Croatia, the measures used to eliminate possible irregularities and illegalities occurring in the capital market are enforced by the Croatian Agency for Supervision of Financial Services (HANFA) and the Central Depository and Clearing Company (CDCC). It is precisely the development of the capital market that leads to increased supervision and awareness of the need to strengthen social responsibility in business. This implies the implementation of state laws as well as independent control of socially responsible stakeholders.