Global Ethics Day 2018: Trust in the City

Nov 6, 2018

This article is by Claire Bennison, and was first published on City A.M. on October 19, 2018. It is reposted here with permission of the author.

Claire Bennison is the head of ACCA UK, representing professional accountants and those aspiring to work in the sector.

Global Ethics Day was on 17 October. Now in its fifth year, this regular calendar event was created by the Carnegie Council to mark its centenary in 2014. The broad theme this year was ‘ethics in action’, and we partnered with the Carnegie Council and CFA Institute to produce a series of films called Ethics in Business: in their own words, which are now online, interviewing Chief Executives about what ethics means to them.

For ACCA, creating a dialogue was a key part of our work on the day.

We hosted a global series of over 20 breakfast events which “followed the sun” to draw on the views of a diverse range of professionals, regulators and experts on how business can approach a shared “ethical future”, and how ethics can be put into action.

In London, we were fortunate to be hosted at the Mansion House by the Lord Mayor of the City of London, Charles Bowman. This breakfast recognised the strong links between ACCA’s work on ethics and the City’s Business of Trust initiative, a project that addresses the “crisis of trust” which has afflicted, not just the City, but a range of global institutions over the decade since the financial crisis.

From our London discussion, it emerged that trust has a clear economic value: those organisations that create and sustain trust can operate efficiently and effectively, winning both staff and customer loyalty. Those that destroy trust risk losing their social license to operate altogether.

ACCA’s chief executive Helen Brand noted that the expectations placed on businesses now go way beyond shareholder value and profit maximisation: accounting has made great strides in helping businesses measure their impact in areas such as climate change and human capital, with a key role for many professionals to help businesses navigate those developments ethically.

Members of professional bodies such as ACCA have long had their own ethical codes of conduct to guide them. But there’s rarely a critical mass of ethically governed people in a business: only some directors within a business will be bound by professional codes, while other professionals will be concentrated in departments such as legal, HR and finance rather than at the core of the business.

This means there is a wider ecosystem to consider. As David Johnson, master of the Worshipful Company of Management Consultants pointed out, consultancy as a profession might depend on trust, but individual consultants face no sanctions for ethical breaches. Complex networks of highly specialised professionals exist without any linkage of the risk of their activities, or the ability to take a broader view of their clients.

This fragmentation is reflected in regulatory structures and codes, and our panelists asked pertinent questions about the value of corporate governance. The view was that corporate governance can’t be seen in isolation, and that regulation can only go so far. We spoke a lot about behaviors and the personal conduct of the individuals that make up the Board who are leaders in a business.

As the Lord Mayor pointed out, personal responsibility, education and the changing values of young people play a crucial role here. Outside the professions, young people often enter the workplace without any basic ethical grounding and are left to find their way without training or role models.

For ACCA, many of the young people we meet and speak to about joining the profession are deeply values driven, and our research shows that both “Generation Z” and accountants want value-driven careers in businesses with a clear sense of purpose beyond just profit.

Ethics is weaved into our qualification in our Ethics and Professional Skills Module. It’s highly encouraging in this context that this module has gained widespread interest outside the profession. And a major strand of the Lord Mayor’s Business of Trust initiative has been to engage even earlier by working with schools, initially in the City but now both nationally and internationally to educate children on the civic principles on which trust rests.

We also spoke about leadership, and how “tone at the top” is also vital. Boards may complain of the difficulty of cascading their values through the organisation, but they also need to be aware of the “power of their shadows” and the need to lead by example. How you do business is as important as what you do.

On Global Ethics Day, it was inevitable that the question would arise of whether global ethics is possible: can there be a global standard in a world of such disparate cultures and beliefs? ACCA has a single code of ethics that applies to all our members everywhere – and this is precisely why governments and employers value those members. And the City Values Forum has developed the City Obligation, a personal pledge which draws on universally understood principles such as “my word is my bond” and applying the Golden Rule of “do as you would be done by”.

But the effectiveness of such codes, voluntary or otherwise, rests on public awareness. We’re acutely aware that both in the UK and internationally the public are often unaware of the ability to invoke professional ethics and to seek redress from their accountants. The transparent process of making assessments and levying sanctions might seem initially to create bad publicity, but experience shows that when people feel their complaints are being heard and treated with respect it increases trust and loyalty.

Although it rests on simple principles, ethics remains a complex issue: much remains to be done to embed ethics in organisations, raise public perceptions and build trust.

That’s why we’re looking forward to bringing together the outcomes from all our activities on Global Ethics Day into a report which will carry on this vital debate.

A place of change: towering City of London skyline (Source: Getty)