Doing the right thing takes courage and isn’t always easy. We explain why having moral courage is a strength required of all business professionals.
In the ICAS research report What do you do now? Ethical issues encountered by Chartered Accountants, Dr David Molyneaux said that ‘courage’ is not usually a term associated with the accountancy profession. He noted: ‘Lord Moran in his study, the Anatomy of Courage, which drew on his extensive personal observations during both world wars of persons of every rank (from private to Prime Minister), defined fear as “the response of the instinct of self-preservation to danger”. “Courage” is the “willpower” to cope with that instinctive reaction.’
Many people, including Chartered Accountants (CAs), occupy vital roles within various differing types of organisation where difficult decisions have to be made on a daily basis. Such decisions can be subject to unnecessary influence from others within the organisation – for example, they may have an agenda that favours reporting better financial results than the company has actually achieved. These influences are likely to weigh heavily when year-end results, related bonuses and share awards are being determined or exercised. In other cases, that agenda might be furthered by seeking to influence the markets through, for example, reporting smoother profits over a period of time. In many situations, ‘doing the right thing’ may not be easy – it might be that an individual is the only member of the Board who believes that a certain course of action is the only acceptable direction for the company to take. Such matters are highlighted in ICAS ethics case studies.
These pressures are not new, but continue to be faced by individuals in their daily lives. Their impact cannot be understated and the consequences of an inappropriate decision can be potentially ruinous for not only the individual, but also their organisation.
‘Moral courage’ is required in order to counter these ‘fears’ – the reputational fears, the livelihood fears – the pressures that individuals can face that can lead to them compromising ethical principles.
Since 2017, the need for CAs to have ‘courage to act morally’ has been highlighted in the ICAS Code of Ethics. ICAS adopted ‘moral courage’ as an ‘enabler’ – an underpinning qualitative characteristic required of a professional accountant – in order to ensure compliance with the Code’s five fundamental ethics principles.
Having the courage of your convictions
As discussed in the ICAS research Speak up? Listen Up? Whistleblow, whistleblowing and ‘speak-up’ mechanisms within organisations are vitally important – encouraging and empowering individuals to have the confidence to promote good behaviour, influence others and ‘speak up’ if they encounter ethical issues. Speaking up allows issues to be dealt with at the earliest opportunity before they escalate. Listening is also important, and it needs to lead to action. If someone speaks up but nobody listens, then the speaking up will not be effective. There is therefore a need for managers to ‘listen up’ – concerns need to be listened to and then action taken to investigate the issue. Sometimes an investigation will show that there are no issues, sometimes people will be mistaken, but they need to know that matters will be investigated so that issues of concern do come to light.
So what can you do if you become aware of an issue that causes you concern? How can you seek to influence events? If you have concerns, have the confidence, the moral courage, to elevate and share them. Do not tackle an issue alone. Speak to a trusted colleague or friend, or use your professional network to discuss issues confidentially. Similarly, if someone brings their concerns to you, you should listen and act upon what has been heard by investigating the issue. Follow any established internal ‘speak up’ or whistleblowing policies and procedures within your organisation; speak to your line manager, or your board of directors. Always keep an evidence trail of conversations, emails and documents. Keeping a diary of meetings and noting down a summary immediately afterwards can be helpful.
Ultimately, you need to choose whatever means you feel most appropriate to help you, depending upon your particular circumstances.
Clearly, the higher up in an organisation a person is, the easier it may be for them to influence the organisation; but, no matter what your role is in the organisation, the key is that when you recognise there is an issue, seek to ensure your voice of concern is heard.
In the words of Michael Woodford, the former CEO of Olympus, who spoke at an ICAS event: “If you know something is wrong and you choose to do nothing, you become complicit. People think that rather than confront the issue, you can walk away, but that’s not the case if you are a senior officer of a corporation.” If you adopt an ‘ignorance is bliss’ approach in all likelihood this will come back to haunt you.
Ethical leadership and moral courage will always be required in order to influence change.
Moral courage is one of the main themes of The Power of One, ICAS’ business ethics initiative. The Power of One calls on all Chartered Accountants (CAs) to place ethical leadership at the heart of their professional responsibilities, to shape the culture and values of their organisations, to help re-establish ethics at the core of business practices and to rebuild public trust in business. Whilst The Power of One initiative is primarily targeted at CAs, the values promoted by The Power of One are equally transferable to the broader business community.