Ethics in Business: In Their Own Words with ACCA’s Helen Brand and IFAC’s Kevin Dancey


– ACCA asks its members
anywhere in the world to adhere to a single global
code of ethical conduct. – I think it’s important in
terms as the world goes forward that we have a common platform in terms of an Ethics
Code around the world. (melodious instrumental music) – Hello, I’m Magalie
Laguerre-Wilkinson. Welcome to Ethics in
Business: In their Own Words. ACCA, the Association of
Chartered Certified Accountants has teamed up with Carnegie
Council and CFA Institute to produce this
interview series, launched in 2018 for
Global Ethics Day. It features global
business leaders exploring how businesses are
preparing for an ethical future in the face of challenges
presented by globalization, technology, and
human psychology. Today, we’ll be featuring
two business leaders. First, we’ll be speaking
with Helen Brand OBE, Chief Executive of ACCA. And then we’ll talk
with Kevin Dancey, CEO of the International
Federation of
Accountants or IFAC. ACCA is the leading global body for professional accountants. It believes that
accountancy is vital for economies to
grow and prosper, and works all over the world
to build the profession and make societies fairer
and more transparent. It’s 208,000 members are trained to think critically
and strategically. They are leaders in the
organizations they work in all over the world, helping them to grow and prosper in an ethical, responsible way. ACCA’s reputation has made it the most sought
after qualification for aspiring
professional accountants with over half a million
students currently studying an ACCA qualification in 179
countries around the world, and at the heart of that
training lies ethics. Here’s our talk with ACCA
chief executive, Helen Brand. What role does ACCA
play in the community? – ACCA is the global body
for professional accountants, and we’re there to provide the professional
accountants and expertise that ensure
sustainable development of economies and businesses
where our members work. – What is the code of ethics that accountants
are signed up to? – The International
Federation of Accountants produces an international
Code of Ethics, and that’s the one
that ACCA has adopted and many other professional
accountancy organizations across the world, and that’s essentially
the standards of conduct by which all
accountants must abide and by which they’re regulated. And therefore, if a member of
the public makes a complaint about any professional
accountant who is a member of
a body such as ACCA, it will be investigated, and if necessary,
disciplinary action taken. The public doesn’t
always know that. It’s our job to make it known, but that accountability loop is driven by the Code of Ethics. – So you’re basically
the internal affairs or the police of
accountants, right? Are you an
accountant’s nightmare? (laughs) – No. Accountants love being ethical. That’s the point. It’s only ever a
very small percentage that move beyond
the Code of Ethics or transgress the
Code of Ethics, and I think that’s
the point about trust. The public needs to
trust that people will first of all abide by
that Code of Ethics, and on the rare
occasions when they don’t that they will be
held to account. – What are some
philanthropic efforts the ACCA is undertaking? – ACCA’s public value remit really means we’re
driving societal change and sustainable economic growth through the
accountancy profession. So I don’t always like
to narrow things down to specific initiatives
that we’re having because the
organization as a whole and all of our
200,000 plus members and half a million students should be driving towards
adding value to the businesses, economies, societies
where they work. That having been said, it’s been fantastic to
be very heavily involved in developing the accountancy
profession in countries such as Afghanistan,
Rwanda, Myanmar, where you can see
there’s a real need in rebuilding those
economies and societies with a professionalism
and ethics that professional
accountants can bring. – You mentioned some
of these countries. What are the trends
that you’re seeing? – Like all businesses
in all sectors, digitization or the increased
use of technology in business is absolutely huge. So there’s no aspect of work, be that your ethical conduct or the way you process
that isn’t going to be impacted by that
digital transformation
that we’re seeing. So that’s kinda given in
everything we talk about now. But also increased
governance and regulation very much to the fore, so governments looking
for better governance within businesses
and organizations to be accountable to
their stakeholders and to the wider public. And also, I think the
environmental impact, so how businesses are
dealing with the environment, and being held to
account for that also incredibly important. All of this, of course backed
up by ACCA’s own research. We framed it, professional
accountants the future, and these trends came out
very much to the fore. – How is ACCA managing its
impact on the environment? – We can’t manage
what we don’t measure. So this is where the
accountancy profession really comes into
its own in terms of helping businesses,
organizations, governments to understand the real impact of their activity
on the environment, and therefore
taking action on it. We need common standards
of measurements, so we all understand the
impacts that we’re having. It’s been great. We’re going to be celebrating
this year the Prince of Wales, Prince Charles’ decade of
accounting for sustainability, the integrated reporting
movements lead by the IIRC, the International Integrated
Reporting Council. All of these movements
have very much focused on getting the right measures to make sure we can
manage our impact. – How does ACCA work
to create diversity in the accounting industry? – First and foremost, to be diverse you
have to be inclusive, and that means
creating the pathways to enter the profession
in the first place. So since its very
inception in 1904, ACCA has worked along values
of diversity and inclusion, providing opportunity
without artificial barriers. In other words, it doesn’t
matter your background, it doesn’t matter your wealth. You should have access to
that fantastic profession that can transform your life and transform the life of your
family and your community. Since 1904, we’ve been
working in that way. More recently, in 2015, we
created a product called ACCA-X, which was an accessible
education platform free
of charge for people to try out
accountancy learning and to understand if
they wanted to go further and become a full professional or just have that basic
financial understanding that makes you better able
to function in your home, in your society,
in your workplace. The other way is
through role models. We have members from so many countries
around the world, well over a hundred
countries around the world, from many, many
different backgrounds, who are proud of the
progress they’ve made through the profession. And talking about
those role models, putting them on a platform, and making sure that
they can communicate with the next generation
is incredibly powerful. – Do you feel there
are still challenges around gender equality
in this profession? – Unfortunately, there
still are many challenges in spite of the number of
entrants to the profession being largely 50-50
in terms of gender. When you look at the number
of CFOs who are female and the Fortune 500. When you look at the
number of partners in the major firms
around the world, the percentages
simply don’t reflect that balance that we’d like
to see within the workplace. So ACCA does put a lot of
effort into researching this, to assisting women members
to progress further, make sure they’re getting the
right support and training, but also through our
research and insights. And most recently we
did a piece of research showing that there is a
seven-year handicap for women reaching the same
executive level as men. And there’s been a myth
grown up around this that it’s the failure of women
to have the right confidence or to lean in in their careers, to take the risks to become,
reach that executive level. In fact, what we found is that women quite often are
denied the same opportunities to take new assignments, to
take those strategic roles, and to be sponsored by a mentor who will protect them from
the politics in the workplace and allow them to progress. That’s actually meaning
it’s a seven-year period that they’re delayed in
reaching that executive level. So that’s good in a
way to discover that, because now we can take
the practical steps that will allow women
the same opportunities to progress as strategic
leaders within the workplace. – And what are the
practical steps? – Well first of all, assigning those mentors and
making sure they’re in place; making sure that when there are big opportunities, new projects, that there is an open
and transparent way that people are appointed
to lead those projects, and it’s not simply
a tap on the shoulder of the person you know best
or whom is closest to you. It’s that openness
and transparency that will give women
the equal opportunities to men in the workplace. – How is ACCA helping with
the retraining of accountants to help them adapt to
this technological age? – So ACCA has produced its seven professional
quotients for success. We’ve communicated that
to all our members, and we’ve produced
a diagnostic tool where they can assess their
own gaps in knowledge, and then we direct them
to learning and training and opportunities for
enhancement to fill those gaps and ensure that they’re equipped to be the professional
accountants of the future, and that’s at all
stages of your career. – So last year, last October, ACCA launched Ethics and
Professional Skills module. What is this exactly? – So in 2007, ACCA produced
its first Ethics module. In 2017, we revamped
that in line with the entire qualification. It has become the Ethics and
Professional Skills module, to put that ethical conduct within a broader
professional framework and test comprehensively how somebody will react
to challenging situations within the workplace. So this is an
interactive module. It puts you in
real-life scenarios, and you apply your
knowledge of the workplace to those scenarios to
say how you would behave. And there is no right
or wrong answer here. This is one of the very
important things about ethics. It’s not something that
can be taught line by line. It’s not something you’re
going to learn page by page, but you’re going to have to
apply your professional judgment to those circumstances and
reach an ethical conclusion, so it’s a fantastic tool. We’ve developed it for
professional accountants, but actually business
people from many sectors are delighted with this, and we’re hoping to be
sharing that content with them over the coming years. – How have you seen
ethical conduct evolve since you joined
ACCA 10 years ago? – Since I became chief
executive of ACCA 10 years ago the focus on ethics has become
much more intense I feel, and that’s because of the
public expectation of business and of the profession. It’s a very dynamic
world we live in. Certainties that
people used to have might no longer be there, be that economically,
politically. The dynamics even within
the family are changing. So knowing where
the profession sits and how that ethical
conduct is going to play across all of that
dynamic is so important. Certainly, at ACCA year by year we’re ratcheting up that focus and also education and
training for our members around ethical and
professional conduct. – When you took the role as CEO what was your biggest challenge? – When I became chief executive, my biggest challenge
was to think, how are we going to stay
relevant in this changing world, in a global changing world. So ACCA is a global player. It’s a global organization. We have so many
interests and countries and members to deal with. So, how do you stay relevant
to those that you’re serving? Ultimately, we’re
serving the public. It’s a big challenge, but I
think we’ve come a long way. – What is the greatest ethical
challenge facing the ACCA and the accounting
world in general? – I feel that the
greatest challenge for the accounting
profession and ACCA is to maintain and
establish where it’s needed trust in the profession. We actually can’t
function as a profession without that trust. And yes, it’s been under
challenge from many directions, be that the economic
changes we’re seeing, having to behave ethically within the digital
age that we’re now in. It’s a changing landscape, and yet we absolutely
need to maintain that steadfast ethical
call to the profession and trust from the public in order that the
profession can function. – You talk about maintaining
that steadfast ethical call. Is it a one-size-fits-all
approach? Does it work differently
in different countries? Can you explain how ACCA
might work that way? – ACCA asks its members
anywhere in the world to adhere to a single global
code of ethical conduct, and we feel that’s
incredibly important. So If you talk to an ACCA
member in Afghanistan or in Beijing or
here in London today, they will be pursuing the same ethical and
professional conduct, and more importantly, be
held to account for it. So being part of a
professional body means you are held to account for
your professional conduct. And I think that issue of
public trust and confidence really relies on the knowing that that single standard
is being applied. – And now, we’ll turn to
our talk with Kevin Dancey, CEO of the International
Federation of
Accountants or IFAC. IFAC is the global organization for the accountancy profession dedicated to serving
the public interest by strengthening the profession and contributing
to the development of strong international
economies. IFAC is comprised of over
175 members and associates in more than 130 countries
and jurisdictions, representing almost
three million accountants in public practice, education, government service,
industry, and commerce. What role does IFAC
play in the community? In other words, in what way,
if that’s even plausible, would I recognize IFAC? – IFAC itself is a relatively
small organization. We have about 80 employees. What’s interesting is
that of the 80 employees, they’re from almost 30 different
countries around the world, and they speak over 30
different languages. So you wouldn’t see us
so much on the frontline. Who you would see
on the frontline, for example, in the US, is the
American Institute of CPAs, which is one of
our member bodies. I’m from Canada. You would see CPA Canada. So the organizations you
would see on the frontline are the member bodies in the
countries around the world. – How does IFAC and how does
the accounting profession manage its impact
on the environment? – Very interesting. Some people say, the only ones who can save
the world are accountants. The basis for that, now,
that’s overstating the case, but what gets
measured gets done. And accountants are
really responsible for the language of business. How do companies, organizations
get their story out? And a big emphasis nowadays
is on sustainability reporting and what’s going to
happen down the road. And that’s where
accountants come to bear. Because if there’s no language that allows companies to
explain that in a useful way, an understandable
way, a relevant way,
and a reliable way, then it’ll just be anecdotal. So that’s the key way that accountants can
play in that space. – You were talking before
about just sort of how, your members have
their tentacles out in different ways
in the community. Is IFAC invested in creating
a diverse workforce? – Well as I said, we
have about 80 employees from just under 30
countries around the world. They speak over 30
different languages. This is the fourth
time I’ve been a CEO, and this is by far the
most diverse organization in terms of employees
that I have seen. And in terms of what we do, in terms of setting up
committees and boards that support IFAC, obviously a key issue is do we have the right
geographic representation? Do we have the right gender
representation, et cetera? So diversity is a key value
that runs throughout IFAC. – So it’s already part
of the DNA of IFAC. – Absolutely, and it has to be. Because as a global
organization, you can’t take a model
that works in country X and just assume that
that’s going to work in every country
around the world. You have to shape it
so that it fits within the different cultures and
countries around the world. – And that context makes sense. Makes sense. Are accountants up to speed
with technological change? I’m going to ask you
a little bit about, what about artificial
intelligence? Is that part of the evolution? Has it been welcomed? – Well, yes, it has been, and really it has to be, because you’re not going to
stop the technological change. I look at the changes that
I’ve seen in my career, and that’s been huge. When I started, there was no
internet, email, et cetera. There weren’t even cellphones. There wasn’t even voicemail. So I’ve seen a huge change
throughout my career. And going forward, that change is going to
be faster and more rapid, so we have to deal with it. And one of the things
we’re doing at IFAC to support a future-ready
profession going forward is on the education front. Now, we can’t come up with
all the courses and advice, but we can leverage what’s
going on around the world to make sure that the various
member bodies around the world know what’s going on
and can incorporate that into their education programs. – What is the greatest
ethical challenge facing IFAC or the accounting
field in general? – I think there’s a couple. One, we support the
International Ethics Board. And I think it’s important in terms as the
world goes forward, that we have a common platform in terms of an Ethics
Code around the world. You don’t need
ethics for country X that are different from
ethics from country Y. So in terms of supporting that to get a common platform
around the world is a key initiative that
IFAC is involved in, because that leads
to harmonization
in terms of ethics. Now the key challenge
for us probably right now is maintaining trust. Because as you know trust
takes a long time to build up, and you can lose
it in a heartbeat. And one of the things
about the business we’re in is we can be right
99.9% of the time, but the 0.1% we’re wrong
is what we get tarred with. So constantly trying to restore
trust and build up trust is a key challenge for us, and it’s a key area that
we’re working on all the time. – I’m going to ask
you a little bit about the International Ethics
Standards Board for Accountants. A revised Code of Ethics has recently been
implemented by the IESBA. What are the highlights
of those changes and how does IFAC support the
standard setting for ethics? – Well, I’ll deal with
the last part first. In terms of supporting it, we hire the staff, we
provide the facilities, we basically pay for it through funds that we get
from our member bodies and global accounting firms. So we really provide
the support for it. It is an independent board. We don’t have any effect in
terms of what the standards are, but we are the key
support mechanism for it. It’s made up of 18 individuals
from around the world, some practitioners,
some non-practitioners, some public members, et cetera. And that board is responsible for basically
amending and renewing the International
Code of Ethics. – So amending. How often does that happen? – The Code was just
renewed in 2019 in terms of being refreshed, a little reorganization
to make it easier to use. There are constantly
going to be areas that need to be looked at, for example, non-audit services. When you do an audit, you
need to be independent, you have to be careful
you’re not doing too much in terms of the non-audit side. So what’s the right
balance there? Also in terms of the
business model going forward, in terms of, if the fees from a particular
client are too much, is that going to affect your
objectivity and independence because you’re so reliant
on that organization? As business models change, as
the world gets more complex, and as the way people
do business changes just with the impacts of
technology and everything else, do the principles
that apply in terms of the way they have in the past, are they still going to support the professional
accountant going forward? – You’ve talked a lot in our
conversation about trust. How is the accounting industry
viewed by the general public in your opinion and
from your position? Is it challenging to gain trust? And if so, and if
it’s not really there, what are you doing to
rebuild it, to gain it again? – Well, as I said earlier, we work in a profession where you can be right
99.9% of the time and the 0.1% of the time
you’re wrong is what tars you. Having said that, surveys we have done, kinda comparing
professional accountants against other professions or
media or politicians, or NGOs, show actually that
professional accountants come out fairly well. We did a recent one on tax. We surveyed the general
public in the G20, which is across 20 different
jurisdictions around the world. And when you compared
professional tax accountants to lawyers, the politicians,
the media, the NGOs, we came out on top. Having said that, we
were just under 60%, so there’s still a
lot of room to go. And I think it just has to
be a constant focus for us in terms of going forward. So in terms of things that
we’re looking at going forward, clearly it’s supporting
the Ethics Board. It’s looking at other examples
that we can latch on to. We’re looking at
having some guidance in terms of professional conduct in relation to how you would
you operate a tax practice. What’s the appropriate approach in terms of tax
planning these days? Because there’s a lot of stuff
out there about tax evasion, tax avoidance, aggressive
tax avoidance, et cetera. And you have to stay attuned to how the
environment’s changing. How boards of
directors are changing in terms of how they
asses that risk, to make sure that we as
professional accountants still remain relevant to
satisfy what their needs are. – You know there’s always, at least speaking
in the United States for the person who
is, let’s just say, not accountant literate. – Right. – That would be me for instance. I think the lack of
trust comes from a place where there’s lack
of comprehension or people feel like they’re trying to get
caught in certain ways. Do you agree with that a little? – Yeah, to a certain extent. When I think of the concept
of trust these days, it’s not just in relation to
trust in terms of accountants. It’s a trust in terms of media. It’s a trust in terms of
politicians and governments. There’s a lot of lack of trust around a whole bunch
of areas right now. Now, our area of focus is
professional accountants, and that’s where we’re focusing. But this concept of lack of
trust is not unique to us. It is across the landscape. – Before an assignment,
do you have to, is it a ritual to go through what the Code of Ethics
are in your mind? I mean is this something that– – Well, you have to make sure that you believe you are
competent to do that. For example, prior to
doing an assignment, are you competent
to do the role? Do you have the ability
to do that role? Are you going to carry it out with the right confidentiality, with the right due care, with the right
objectivity, et cetera? So these are all concepts that fit into the way a professional accountant
approaches his role. – And is there sort of like a, is there a mantra that
accountants have to follow? Is there some inner prayer that you have to say
before you do something? – No, it’s not like that. It’s not like that. But it needs to become
part of your DNA. The DNA of an accountant just
has to have a strong core in terms of a
strong ethical core to do the job the right way. (melodious instrumental music)

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