Considering the Code of Ethics for Professional Accountants (the Code), issued by the International Ethics Standards Board for Accountants, is global in application, it was with great interest I attended the recent launch of a report produced by the Institute of Business Ethics (IBE), Towards Ethical Norms in International Transactions. It explores both a global definition of responsible business and a set of universal standards that would take account of value differences across cultures.
The seed of the report was sown several years ago in the 1990s through the publication of An Interfaith Declaration: A Code of Ethics in International Business, based on discussions held in the UK and the Kingdom of Jordan over six years. A group of distinguished Jewish, Christian, and Muslim thinkers and business leaders were brought together to see if they could agree on principles that might serve as guidelines for international business behavior.
This was a response to the intensifying of globalization and the establishment of international economic integration, and in recognition of the interdependency between nations for the well-being of not only economies but citizens. Such integration has intensified, as have major economic changes and technological advances. So, too, has the spread of international standards, the Code among them, revisited and reworked in response to events in the external environment.
Back in the 1990s, the work around the Interfaith Declaration showed the most common values shared between Judaism, Christianity, and Islam—and found across other religions and schools of philosophical thought—were:
- justice (i.e., fairness);
- mutual respect (i.e., love, consideration);
- honesty (i.e., transparency, openness truthfulness); and
- stewardship (i.e., trusteeship, accountability, responsibility).
It is not hard to identify aspects of these values within many areas of the Code, with integrity encompassing many of them: “to be straightforward and honest in all professional and business relationships” and “fair dealing and truthfulness” as well as the need to act in the public interest.
The current IBE report argues that having a shared code of practice for the global business community can help grow economies and address social inequalities. In particular, it explores the role and relevance of establishing ethical norms in international business transactions, as indicated by the number of international standards that relate to aspects of business behavior.
Standards such as the United National Global Compact’s Ten Principles, the Ruggie Guiding Principles on Business and Human Rights, and the Bangladesh Accord signed in response to the Rana Plaza disaster, have a critical role in shaping business behavior. In addition the growth of extraterritorial legislation, such as the US Foreign Corrupt Practices Act and the UK Bribery Act has also had an impact in shaping law, policies, and behaviors around the world and, in turn, further embedding global standards.
The core values would have to be universally acknowledged, the report states, citing, the Golden Rule—treat others as you wish to be treated—as the closest there is to a universal norm. “If it is applied in every instance of business interaction and taken seriously by the parties involved, unethical behavior is likely to be reduced with the potential that prosperity will increase,” according to the report’s author, Simon Webley.
Professional accountants upholding the Code, wherever they are in the world, in whatever role, clearly contribute to this potential. In late May, given that global leaders such as the IMF’s Managing Director Christine Lagarde, former US President Bill Clinton, and the Governor of the Bank of England Mark Carney, joined together in London with CEOs of leading companies to discuss the importance of inclusive capitalism and the costs of unethical behavior, corporate leaders who do not pay attention now may pay the price later.
