The ethics of professional accountants: An Aristotelian perspective

Purpose The purpose of this paper is to examine how Aristotle’s ethics can be applied to the ethics of professional accountants, in relation to the approach adopted by the International Federation of Accountants (IFAC), and to consider the reasons that justify the Aristotelian approach. Design/methodology/approach The paper outlines IFAC’s approach and identifies several weaknesses. Three themes of Aristotle’s Nicomachean Ethics are applied to the work of professional accountants. Reasons why this perspective is more suitable for professional accountants are then articulated. Findings Several aspects of Aristotle’s ethics can be fruitfully applied to the ethics of professional accountants. These include the relationship between function, goals and the good, an awareness of the human goal to achieve eudaimonia, the development of both excellences of character and of intelligence, and the significance of non-rational aspects of morality, including emotions, will, responsibility and choice. Research limitations/implications This perspective provides an alternative conceptualisation of the ethics of professional accountants. Although it does not provide concrete guidance regarding what the ethical approach to specific situations may be, it presents a useful counterpoint to existing approaches that are largely deontological and utilitarian. Practical implications This paper provides accountants in practice with a more comprehensive and adequate perspective on what it means for a professional accountant to be ethical, and raises several issues related to how ethics is included in the education and training of accountants. Originality/value Investigating the philosophical basis for professional ethics approaches professional codes of ethics in a way that it is not typically considered. The paper also provides a more comprehensive application of Aristotelian ethics than previous work.

Food waste, power, and corporate social responsibility in the Australian food supply chain

By examining corporate social responsibility (CSR) and power within the context of the food supply chain, this paper illustrates how food retailers claim to address food waste while simultaneously setting standards that result in the large-scale rejection of edible food on cosmetic grounds. Specifically, this paper considers the powerful role of food retailers and how they may be considered to be legitimately engaging in socially responsible behaviors to lower food waste, yet implement practices that ultimately contribute to higher levels of food waste elsewhere in the supply chain. Through interviews with key actors in the Australian fresh fruit and vegetable supply chain, we highlight the existence of a legitimacy gap in corporate social responsibility whereby undesirable behaviors are pushed elsewhere in the supply chain. It is argued that the structural power held by Australia’s retail duopoly means that supermarkets are able to claim virtuous and responsible behaviors, despite counter claims from within the fresh food industry that the food supermarkets’ private quality standards mean that fresh food is wasted. We argue that the supermarkets claim CSR kudos for reducing food waste at the expense of other supply chain actors who bear both the economic cost and the moral burden of waste, and that this is a consequence of supermarkets’ remarkable market power in Australia.

Busy auditors, ethical behavior, and discretionary accruals quality in Malaysia

The required professional and ethical pronouncements of accountants mean that auditors need to be competent and exercise due care and skill in the performance of their audits. In this study, we examine what happens when auditors take on more clients than they should, thus raising doubts about their ability to maintain competence and audit quality. Using 2803 observations of Malaysian companies from 2010 to 2013, we find that auditors with multiple clients are associated with lower earnings quality, proxied by total accruals and discretionary accruals. Our results demonstrate that associating client firms’ reported discretionary accruals with individual auditors, rather than their firms or offices, is important in determining audit quality. Moreover, we demonstrate that the disclosure of auditors’ signatures on their reports is useful for assessing auditor quality at the individual level, thus contributing to the debate on the usefulness of having auditor identities on reports.

Review of international procurement procedures

Contractor selection is a crucial element in construction procurement (Drew & Skitmore 1993, p. 363). Contractors are selected through the tender process, which varies according to country, state and contracting organisation and is subject to individual differences. This paper reviews a range of international tender processes, highlighting the ethical features that govern these guidelines. The paper is part of a project to develop ethical guidelines for procurement for major contracting authorities. By reviewing tender guidelines we are able to gain an indication of the type of ethical standards reserved for procurement. The need for good business ethics in the tender process stems from the belief that ‘good ethical practice’ is critical in meeting organisational goals (Vee & Skitmore 2003, p. 125). Hence, an ethical tender process will select ethical contractors who are viewed as beneficial to the contracting authority.

Accountability, transparency, impartiality, and other ethical issues : improving democracy reduces violence

Violence is detrimental to the stability of any democracy. If people are too scared to vote, or if they lack confidence in their government to bring peace, how will their voices be heard? By discussing how accountability, transparency, and ethics dissuade social confusion, improve democracy, and lessen occurrences of violence, perhaps one can increase the success in the instance of stabilizing a new democracy or reinvigorating an old one. Theoretically resulting in more peaceful governmental transitions; accountability, transparency, and ethics in democracy are a must to build social trust, improve democracy, and reduce violence.

Treating an unhealthy organisational culture : the implications of the Bundaberg Hospital inquiry for managerial ethical decision making

This paper explores the interplay between individual values, espoused organisational values and the values of the organisational culture in practice in light of a recent Royal Commission in Queensland, Australia, which highlighted systematic failures in patient care. The lack of congruence among values at these levels impacts upon the ethical decision making of health managers. The presence of institutional ethics regimes such as the Public Sector Ethics Act 1994 (Qld) and agency codes of conduct are not sufficient to counteract the negative influence of informal codes of practice that undermine espoused organisational values and community standards. The ethical decision-making capacity of health care managers remains at the front line in the battle against unethical and unprofessional practice. What is known about the topic? Value congruence theory focusses on the conflicts between individual and organisational values. Congruence between individual values, espoused values and values expressed in everyday practice can only be achieved by ensuring that such shared values are an ever-present factor in managerial decision making. What does this paper add? The importance of value congruence in building and sustaining a healthy organisational culture is confirmed by the evidence presented in the Bundaberg Hospital Inquiry. The presence of strong individual values among staff and strong espoused values in line with community expectations and backed up by legislation and ethics regimes were not, in themselves, sufficient to ensure a healthy organisational culture and prevent unethical, and possibly illegal, behaviour. What are the implications for practitioners? Managers must incorporate ethics in decision making to establish and maintain the nexus between individual and organisational values that is a vital component of a healthy organisational culture.

Adam Smith's Dinner

The Future of Financial Regulation is an edited collection of papers presented at a major conference at the University of Glasgow in Spring 2009. It draws together a variety of different perspectives on the international financial crisis which began in August 2007 and later turned into a more widespread economic crisis following the collapse of Lehman Brothers in the Autumn of 2008. Spring 2009 was in many respects the nadir since valuations in financial markets had reached their low point and crisis management rather than regulatory reform was the main focus of attention. The conference and book were deliberately framed as an attempt to re-focus attention from the former to the latter. The first part of the book focuses on the context of the crisis, discussing the general characteristics of financial crises and the specific influences that were at work during this time. The second part focuses more specifically on regulatory techniques and practices implicated in the crisis, noting in particular an over-reliance on the capacity of regulators and financial institutions to manage risk and on the capacity of markets to self-correct. The third part focuses on the role of governance and ethics in the crisis and in particular the need for a common ethical framework to underpin governance practices and to provide greater clarity in the design of accountability mechanisms. The final part focuses on the trajectory of regulatory reform, noting the considerable potential for change as a result of the role of the state in the rescue and recuperation of the financial system and stressing the need for fundamental re-appraisal of business and regulatory models. This informative book will be of interest to financial regulators and theorists, commercial and financial law practitioners, and academics involved in the law and economics of regulation.

Capitalism Quo Vadis?

Transcript: Workshop 3 – Capitalism Quo Vadis Conference on Ethics in Business – Corporate Culture & Spirituality European Parliament, Brussels 14th November 2008

Laughing & disability : comedy, collaborative authorship and Down Under Mystery Tour

This thesis is an exploration of representation, authorship and creative collaboration in disability comedy, the centre piece of which is a feature-length film starring, co-created and co-written by three intellectually-disabled people. The film, entitled Down Under Mystery Tour, aims to entertain, and be accessible to, a mainstream audience, one that would not normally care about disability or listen to disabled voices. In the past, the failure of these voices to reach audiences has been blamed on poor training, marginal timeslots and indifferent audiences. But this project seeks an alternative approach, building collaboration between disabled and non-disabled people to express voice, conceive, construct and produce a filmed narrative, and engage willing audiences who want to listen.

Digital culture : blurred boundaries and ethical considerations

The Weberian sense of work and life suggests that working is something around which the rest of life flows. Moreover, work life and domestic life have been defined as separate for most people based on physical structures. That is, being physically in a building at work limited your ability to interact with those who are not nearby – not part of work. As such, social conventions regarding the uses of media at work have become part of our cultural sensibilities – we “know” it is not proper to have romantic discourse over the office phone, much less romance during work! Doing so becomes news. Yet, despite the construction of such distinctions, these workspaces and places have always been difficult to render as such. For example, one might consider the relatively recent development of teleworking from the 1980s or the “putting out system”[1] which dates back to the 1400s – both requiring work in the home. The papers in this special issue draw our attention to some of the ethical issues raised by the growing pervasiveness of information and communications technologies (ICTs) in our everyday lives and the fact that it is becoming increasingly difficult to make distinctions between being somewhere (like work) and being away from some things (like one’s friends, social interests and other parts of life that are not integrated into this space or place [2] )...

Applying metaethical and normative claims of moral relativism to (shareholder and stakeholder) models of corporate governance

There has, in recent decades, been considerable scholarship regarding the moral aspects of corporate governance,and differences in corporate governance practices around the world have been widely documented and investigated. In such a context, the claims associated with moral relativism are relevant. The purpose of this paper is to provide a detailed consideration of how the metaethical and normative claims of moral relativism in particular can be applied to corporate governance. This objective is achieved, firstly, by reviewing what is meant by metaethical moral relativism and identifying two ways in which the metaethical claim can be assessed. The possibility of a single, morally superior model of corporate governance is subsequently considered through an analysis of prominent works justifying the shareholder and stakeholder approaches, together with a consideration of academic agreement in this area. The paper then draws on the work of Wong (Moral relativity, University of California Press, Berkeley, CA, 1984, A companion to ethics, Blackwell, Malden, 1993, Natural moralities: A defense of pluralistic relativism,Oxford University Press, Oxford, 2006), firstly in providing an argument supporting metaethical moral relativism and secondly regarding values of tolerance and/or accommodation that can contribute to the normative claim. The paper concludes by proposing an argument that it is morally wrong to impose a model of corporate governance where there are differences in moral judgements relevant to corporate governance, or to interfere with a model in similar circumstances, and closes with consideration of the argument’s implications.

Who owns your body? Patricia Piccinini and the future of bioethics

This article analyses some popular cultural representations of biotechnology, especially the artistic work of the Australian artist Patricia Piccinini to reflect on the role of law, technology and ethics in relation to bodily material. Her view that "with creation...comes an obligation to care for the result", so evident in her poignant pictures, is a sober reminder to us of our responsibilities in regulating new technologies.

The attack of the clones: Patent law and stem cell research

This article considers the integral role played by patent law in respect of stem cell research. It highlights concerns about commercialization, access to essential medicines and bioethics. The article maintains that there is a fundamental ambiguity in the Patents Act 1990 (Cth) as to whether stem cell research is patentable subject matter. There is a need to revise the legislation in light of the establishment of the National Stem Cell Centre and the passing of the Research Involving Embryos Act 2002 (Cth). The article raises concerns about the strong patent protection secured by the Wisconsin Alumni Research Foundation and Geron Corporation in respect of stem cell research in the United States. It contends that a number of legal reforms could safeguard access to stem cell lines, and resulting drugs and therapies. Finally, this article explores how ethical concerns are addressed within the framework of the European Biotechnology Directive. It examines the decision of the European Patent Office in relation to the so-called Edinburgh patent, and the inquiry of the European Group on Ethics in Science and New Technologies into The Ethical Aspects of Patenting Involving Human Stem Cells.

Positive development and assessment

Purpose – There has been a tendency in sustainability science to be passive. The purpose of this paper is to introduce an alternative positive framework for a more active and direct approach to sustainable design and assessment that de-couples environmental impacts and economic growth. Design/methodology/approach – This paper deconstructs some systemic gaps that are critical to sustainability in built environment management processes and tools, and reframes negative “sustainable” decision making and assessment frameworks into their positive counterparts. In particular, it addresses the omission of ecology, design and ethics in development assessment. Findings – Development can be designed to provide ecological gains and surplus “eco-services,” but assessment tools and processes favor business-as-usual. Despite the tenacity of the dominant paradigm (DP) in sustainable development institutionalized by the Brundtland Report over 25 years ago, these omissions are easily corrected. Research limitations/implications – The limitation is that the author was unable to find exceptions to the omissions cited here in the extensive literature on urban planning and building assessment tools. However, exceptions prove the rule. The implication is that it is not too late for eco-positive retrofitting of cities to increase natural and social capital. The solutions are just as applicable in places like China and India as the USA, as they pay for themselves. Originality/value – Positive development (PD) is a fundamental paradigm shift that reverses the negative models, methods and metrics of the DP of sustainable development. This paper provides an example of how existing “negative” concepts and practices can be converted into positive ones through a PD prism. Through a new form of bio-physical design, development can be a sustainability solution.

Perceptions on the causes of individual and fraudulent co-offending: Views of forensic accountants

Individual and/or co-offenders fraudulent activities can have a devastating effect on a company’s reputation and credibility. Enron, Xerox, WorldCom, HIH Insurance and One.Tel are examples where stakeholders incurred substantial financial losses as a result of fraud and led to a loss of confidence in corporate dealings by the public in general. There are numerous theoretical approaches that attempt to explain how and why fraudulent acts occur, drawing on the fields of sociology, organisational, management and economic literature, but there is limited empirical evidence published in accounting literature. This qualitative inductive study analyses perceptions and experiences of forensic accountants to gain insights into individual fraud and co-offending in order to determine whether the conceptual framework developed from literature accurately depicts the causes of fraud committed by individuals and groups in the twenty-first century. Findings from the study both support and extend the conceptual framework, demonstrating that strain and anomie can result in fraud, that deviant sub-groups recruit and coerce members by providing relief from strain, and that inadequate corporate governance mechanisms both contribute to fraud occurring, and provide the opportunity for fraudulent activities to be executed and often remain undetected. Additional factors emerging from this study (the ‘technoconomy’, addiction and IT measures) were also identified as contributors to fraud, particularly relevant to the twenty-first century, and consequently, a refined conceptual framework is presented in the discussion and conclusion to the paper.