I think you are confusing the two still.
The terms are upfront about what the company has the LEGAL RIGHT to do. Those are there for people to read. Knowing that their material could be used in a number of manners, the user has the right/ability to not post or to remove their content if they do not believe the terms are fair.
The ethical code would guide the company's actions to ensure that they did not exploit people. Even though the company would have the right to sell a posted photo to one of its B2B partners, the guidelines would ensure that it did not do so without compensating the contributor.
Also, please note I said RESCINDING an established ethical code would create bad blood. The EXISTENCE of an ethical code would not.
That's the best I can do. If you don't understand, I'm sorry.
In any event, what was the company that failed?
(The company I am working for has had its site for nearly a decade I believe. The website is not its main product or business.)