Transcript Integrity - Malaysian Institute of Accountants

Concurrent
Session 1A
9.00am
Banquet Hall
Mr. Mark Billington
Regional Director, South East
Asia, Institute of Chartered
Accountants in England & Wales
(ICAEW)
Ethical Practice Black, White or Grey?
ICAEW
www.mia.org.my
Malaysian Institute of
Accountants
Ethical practice: black, white or
grey?
Mark Billington
14 October 2009
About the ICAEW
• Founded in 1880
• 130,000+ members in 160 countries
• Work in public practice, public sector and industry
• Royal Charter – the public interest and the title Chartered
Accountant
• ICAEW acts as regulator, regulatee and professional
member body
ICAEW
South East Asia
• Long time collaboration with
Malaysia City Group
• 30 Authorised Training
Employers in Malaysia
• Malaysia (2004), Singapore
(2008), South East Asia Office
(2009)
ICAEW
Ethics ….
• Is not corporate governance,
corporate responsibility or
sustainability
• Is values and principles
acceptable to society
• Is concerned with human
character and behaviour
• Goes beyond obeying laws,
rules and regulations
ICAEW
Why is ethics important?
• Markets
T
• Information
• Trust
• Mechanisms
ICAEW
MMO
Ethics in the wider business sphere
Need?
• Enron
• Maxwell
• Banks
National Integrity Plan
Professional influence
• No overall control
• Accountants in roles
• Persuasion
ICAEW
Thought leadership
Information
Research
Corporate
with
for better
Peking
Responsibility
University
markets
Dialogue in
Corporate
corporate
Governance
governance
Risk
re:Assurance
Management
Inspiring
confidence
Financial in
Corporate
Financing
Services
financial
Finance
change
Making
services
Finance&
Sustainable
Finance
Corporate
Information
information
direction
Business
Management
Finance
Technology
systems
work
Audit
Towards a
quality
forum
Taxtax
better
system
Market
Foundations
ICAEW
Market foundations
Public interest
Regulation
Professions
Ethical
behaviour
Legal entities
Economic
crime
ICAEW
Ethical behaviour
• Integrity focus:
- Reporting with integrity
- Instilling integrity in
organisations
ICAEW
Is there always a ‘right’ answer?
• Example: truth or
feelings?
• Example: maintain
confidence or
endorse error?
ICAEW
Drivers of organisational integrity
Leadership
Moral values
Be honest and truthful
Be fair
Strategy
Motives
Comply with laws
Commitments
Promote community
interests
Information
Qualities
Be open and
adaptable
Take corrective
action
Culture
Achievements
Policies
ICAEW
Show consistency
IFAC Code of Ethics
Short
description
of core
approach
Plus some
illustrative
examples
Consider
threats
Apply
safeguards…
…or don’t
do it
Objectivity
Professional
Competence
& due care
Professional
behaviour
Confidentiality
Integrity
ICAEW
A few
prohibitions
Framework for Ethical Decision-Making
 Do I have all the facts relevant to this situation?
 Who should be involved in the discussions?
 What are the ethical issues involved?
 What are the alternative courses of action and their
associated consequences?
ICAEW
Example of rules based approach
The rule of unintended consequences!
ICAEW
Why principles over rules?
Not easy option
for users or
regulators, but…
Can apply to
Infinite
circumstances
Avoids ‘its ok
unless
prohibited’
argument
Shorter and
easier to learn
Recognises
reality: manage
conflicts
Avoids legalistic
‘form over
substance’
compliance
ICAEW
Infrastructure – what we do
Education,
inc. CPD
Discipline
License, or PC
Support
Monitoring
Transparency
ICAEW
Auditor independence
• Public focus
• Regulatory involvement
• Lots of rules
• Harmonise around IFAC?
ICAEW
Conclusion: ethical practice is….
• Often seen to be
Black and white
• But it is and should be
Grey
ICAEW
www.icaew.com/ethics
www.icaew.com/southeastasia
[email protected]