Partner Article

Local accountants combat growing pressure to act unethically

Local accountants met in Darlington last week looking to stamp out unethical business practice following information that although four out of five businesses worldwide have committed to ethical performance, the pressure to act unethically has increased, according to a report launched this summer from the Chartered Institute of Management Accountants (CIMA) and the American Institute of CPAs (AICPA).

‘Managing Responsible Business’, a global survey of almost 2,000 Chartered Global Management Accountants (CGMA) in nearly 80 countries also found that 20% of respondents felt under more pressure to compromise their personal or professional standards of ethical conduct in time of economic slowdown. 86% of respondents felt upholding their own professional code of ethics was the main way they contributed to management of ethical performance. How to deal with unethical practice and fraud were examined at the CIMA event ‘Fraud in the workplace: what to do do if you suspect fraudulent activity in your organistion’ for local accountants held at the Blackwell Grange Hotel in Darlington on Tuesday 11th September.

The Managing Responsible Business survey found that 80 percent of organizations provide a code of ethics to guide employees about ethical standards in their work, up from 72 percent in 2008. However, only 36 percent collect ethics information such as the number of employees attending ethics training and actions taken on hotline reports. Since ethical performance can only be managed with the right information, this suggests ethical practice falls short of stated policy, according to the report.

Mike Ashwell, FCMA CGMA and CIMA Teesside Chair, says: “Management accountants across the Teesside region are “in the know” about so much of their organisation’s activities, and champion the difficult balance between ethical transparency and business confidence. Employers and clients can be confident CIMA people uphold the professional standards of ethics and conscience that bring long-term business success even in times like these.”

According to the survey, neither senior management nor boards of directors seem to be reviewing, analyzing and monitoring ethics information at the level recorded four years ago. In 2008, 86 percent of senior management and 68 percent of boards reviewed ethics data, according to the report. In 2012, it was 78 percent and 56 percent, respectively. This “weakened tone from the top” comes as more than a third of those surveyed, 35 percent, said they sometimes or always feel pressured to compromise their organization’s standards of ethical conduct. This compares to 28 percent of respondents in 2008. The pressure is most pronounced in developing economies such as Malaysia, 54 percent, and India, 51 percent, and lowest in the U.K. and U.S., where 18 percent of those surveyed feel pressure.

This was posted in Bdaily's Members' News section by CIMA UK Regional News .