ACCA SBL Syllabus A. Leadership - Ethical Codes - Notes ^{2 / 4}

Purposes of codes of ethics

• To convey the ethical values of the company to employees, customers, communities and shareholders.

  To control unethical practice by limiting and prescribing behaviour in given situations

  To stimulate improved ethical behaviour by insisting on full compliance with the code.

Contents of a corporate code of ethics

Remember this by the useful acronym ETHICS..

• E mployees policies eg equal opportunities policies, training etc
  T ransparent & Truthful Treatment of shareholders
  H ow customers are treated (complaint procedures etc)
  I nclude everyone affected (e.g. Community and wider society)
  C ompany Values
  S ourcing of products/ materials done ethically

Content

1. Introduction

    (Background and disciplinary measures)

2. Fundamental Principles

    (Summary)

3. Conceptual Framework

    (How principles are applied)

4. Detailed Application

    (Specific circumstances)

Principles

1. Integrity

2. Objectivity

3. Professional Competence

4. Confidentiality

5. Professional BehaviourLimitations of Codes

Limitations

• They can convey the (false) impression that professional ethics can be reduced to a set of rules contained in a code. 

  Personal integrity is needed also emphasised.

  Ethical codes do not and cannot capture all ethical dilemmas that an accountant will encounter. 

  Regional variations mean that such codes cannot capture important differences in emphasis in some parts of the world.

  The moral ‘right’ cannot be prescribed in every situation.
  Professional codes of ethics are not technically enforceable in any legal manner