Here, the importance of “liaising with regulators” is made note of, which is an often overlooked aspect of business conduct. It is understood that a regulatory atmosphere conducive to fair and competitive business can help raise ethical standards of all businesses involved. For example, far too often, when some “potentially illegal or unethical business conduct” (Shiner, p.10) does not affect an individual directly, then it is likely to go unreported and unaddressed. Keeping this in mind, the drafters of the code of ethics have included strict policies so that associates and employees can freely report their concerns about suspected breaches in the ethical code without fear of negative consequences. By making it a violation of employment agreement to not report such breaches and violations, the firm gives a clear message to its employees as to how important business standards are. Those who violate the company’s ethical standards, irrespective of designation or tenure, may be subject to legal disciplinary action that can lead to termination of employment (for employees) and contract annulment (for other associates) (Shearer, p.551)
There are other companies in the UK which implement more novel enforcement measures that includes a central ethics committee who will make sure that the code of ethics is followed in letter as well as in spirit. Stakeholders involved in violating the code are subject to stringent disciplinary action that could lead to termination of employment contract. Even contributing indirectly to the violation of these rules can have negative consequences to the party. Failing to report known violations is deemed a punishable offence. In addition to that, disrupting or undermining the internal ethics committee investigations will amount to the same level of punishable offence. Finally, any retaliatory measures on part of the guilty party will attract even severe punishments. Hence, the accounting firm leaves no loop holes for its employees to digress from its commitment to the highest ethical standards (Shearer, p.551).
In conclusion, it is quite clear that it is not enough for companies to cater to the needs of those who have staked their capital. The company’s responsibilities have now been extended to public accountability. Not only have newer legislations been enacted, but some companies have also voluntarily adopted ethical standards for their operations. Yet, one should exercise caution in reading these apparently positive developments. These days “environmental stewardship” and “corporate social responsibility” have become catch phrases in the business world. This is an acknowledgement of the fact that consumers (who are part of a larger public) nowadays expect high ethical standards from corporations. Partly to cater to this demand and partly to indulge in a Public Relations exercise, some multinational corporations in the UK have over the last few years issued reports covering these concepts. But these reports have to be read by keeping in mind the motivation behind all corporate action – Boosting the Bottom-line.
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Roger A. Shiner., Accounting ethics: the general part, Business & Professional Ethics Journal 13.n1-2 (Spring-Summer 1994): p.p9(15).
Teri Shearer., Ethics and accountability: from the for-itself to the for-the-other., Accounting, Organizations and Society 27.6 (August 2002): p.541(33).
Chandler, R., Bartlett, S.A., The Corporate Report And The Private Shareholder, The British Accounting Review, 1997
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