The latest report from Chartered Accountants Worldwide has called for business to instil a culture of ‘moral courage’ from the boardroom throughout the organisation. In Critical Success Factors for Tomorrow’s Business Leaders, the international body claims that social media and the 24-hr scrutiny of the digital age mean that there is a direct link between ethics and value creation that business needs to pay attention to.
The report follows an international summit held in London where senior CEOs, CFOs and executives together with the heads of global Chartered Accountancy bodies gathered to discuss key issues facing future finance professionals. The report covers issues ranging from geopolitical tensions to the need for tax simplification and also draws on research surveying chartered accountants leading UK businesses.
Ethics emerges as one of the main factors that will shape the future of doing business. The report shows that the moral values of organisations are becoming more important to millennials, who want to do business with brands they trust. The report also notes that there is a tension between highly regulated environments which drive a culture of compliance and embedding an ethical environment. A quoted source says “our businesses are not sustainable if we’re depending on regulation to make us ethical. Ethics is about the soul of an organisation. It’s not a matter of compliance and it starts in the boardroom.”
Pat Costello, Chairman of Chartered Accountants Worldwide said: “The digital age means that everyone is under scrutiny, all of the time, and issues can escalate through social media like wildfire. The right decisions need to be taken in real time - it’s no longer enough to rely on the traditional hierarchies. This means we need to foster a culture where people are trained to know what the right thing to do is when a challenge presents itself. A culture of ethics certainly starts in the boardroom, but it can’t stop there.”
The report also notes that tax is now a reputational issue, with aggressive tax avoidance having the potential to do real reputational harm. Although there are concerns surrounding the difference between legitimate tax planning and aggressive avoidance, the report states “a new kind of economics – reputational economics – is now part of boardroom agendas. And it is here to stay.”
The report also examines geopolitical tensions including international conflict and the potential for Britain leaving the European Union, the effects of new technology, skill shortages, and the need for simplification of the tax system.
Lee Fook Chiew, Chief Executive Officer of the Institute of Singapore Chartered Accountants, said: “Business Leaders cannot just manage what is in front of them; they need to be able to see through the complexity to what will be important in the future as well. This means understanding the strategic implications of global issues, whether that is the recent fall in oil prices, conflict in the Middle East, or what is trending on twitter. Chartered accountants are trained to be strategic business leaders, which is why they are well-placed to see the knock-on effects that social change can have on the bottom line. It takes a lot of courage to drive change, but it is the only way to stay ahead.”
The full report Critical Success Factors for Tomorrow’s Business Leaders can be found here.
Contact Magdalena Andrzejewska on +44 (0)20 7920 8718 or email Magdalena.Andrzejewska@icaew.com
Notes to editors:
Chartered Accountants Worldwide
Chartered Accountants Worldwide has been created by the leading institutes of Chartered Accountants from around the world to support, develop and promote the vital role that Chartered Accountants play throughout the global economy. More information on the organisation can be found at charteredaccountantsworldwide.com
Chartered Accountants Worldwide Associate membership is open to Chartered Accountancy bodies who:
refer to their members as Chartered Accountants and legitimately use the Chartered Accountant brand;
are a member of IFAC or an IFAC Recognised Regional Organisation (e.g., CAPA or PAFA);
require their members to commit to continuing professional development;
are committed to working together to promote the Chartered Accountancy brand; and
can demonstrate how they are improving the quality of the Chartered Accountancy qualification.
Institute of Singapore Chartered Accountants
The Institute of Singapore Chartered Accountants (ISCA) is the national accountancy body of Singapore. ISCA’s vision is to be a globally recognised professional accountancy body, bringing value to our members, the profession and wider community. There are over 28,500 ISCA members making their stride in businesses across industries in Singapore and around the world.
Established in 1963, ISCA is an advocate of the interests of the profession. Possessing a Global Mindset, with Asian Insights, ISCA leverages its regional expertise, knowledge, and networks with diverse stakeholders to contribute towards Singapore’s transformation into a global accountancy hub.
ISCA is the Administrator of the Singapore QP and the Designated Entity to confer the Chartered Accountant of Singapore - CA (Singapore) - designation.
ISCA is an Associate of Chartered Accountants Worldwide – supporting, developing and promoting over 325,000 Chartered Accountants in more than 180 countries around the world.