- Integrity is currently high on the agenda for business, government and other organisations
- The costs of integrity failure are high, with financial, emotional and reputational damage
- Chartered and forensic accountants are able to mitigate the consequences and minimise future risk
Chartered Accountants, and particularly forensic accountants, are uniquely equipped to help drive Australia’s integrity agenda.
Our daily news is filled with examples of integrity failures across a wide range of industries from financial services to aged care, as well as in sport, domestic politics, and international relations.
As a society, we seem to expect more of our governments, businesses and their leaders than ever before – certainly beyond fiscal responsibility and shareholder returns. Trust has almost become a form of currency, as there is greater discussion around organisations having ‘a social licence to operate’.
Growing societal expectations have led to legislative and regulatory developments in several areas of the integrity agenda, including whistleblower protection, foreign interference, political donations, bribery and corruption, modern slavery, and money laundering.
In November, International Fraud Awareness Week shone a spotlight on a classic type of integrity failure – providing a timely reminder of the many forms of fraud and the huge costs of economic crime.
When it comes to economic crime and other integrity failures, the stakes are undoubtedly high. The most obvious impacts are the direct financial detriments to the victims of economic crime and unacceptable business practices, and the costs of responding to those issues when detected.
“As professionals educated in strategy and ethics, and governed by a code of ethics with integrity as a fundamental principle, Chartered Accountants must set an example of being straightforward and honest in all professional and business relationships.”
However, secondary impacts, including damage to employee morale, business relationships, brand and reputation, and increased regulatory scrutiny, can diminish business performance and enterprise value as well.
Integrity must be a top priority for boards, senior executives and other leaders – not only because stakeholders expect it, but also because an organisation’s figureheads often personally take the fall in the wake of an integrity scandal that occurs on their watch.
Chartered Accountants occupy a wide variety of positions in public practice, business, government and community organisations, enabling us to play a role in minimising the incidence and impact of integrity failures. As professionals educated in strategy and ethics, and governed by a code of ethics with integrity as a fundamental principle, we must set an example of being straightforward and honest in all professional and business relationships.
More specifically, forensic accountants gain valuable experience in dealing with investigations and disputes that flow from integrity failures. This provides us with an enhanced perspective on how to mitigate negative consequences, remediate problems and minimise the risk of similar events occurring in future.
As you browse the final edition of the forensic accounting newsletter for 2019, I invite you to consider how you can contribute to the integrity agenda within your organisation and in your dealings with others.
I wish you all a safe and prosperous festive season and look forward to a productive 2020.