2 Mar 2016 10:46am

From the top: Andrew Ratcliffe

Andrew Ratcliffe ponders the importance of professionalism and changing requirements over standards

One of my most enjoyable duties as president is welcoming new members into ICAEW. I tell them that membership is not just about passing exams but about joining a profession. This begs the question of whether they, or indeed I, know what we are talking about when we use the word “profession”.

The modern professions are largely a 19th century phenomenon. By insisting members should be properly qualified and by enforcing discipline, the professions said that they would ensure a service marked by competence and quality. In return, they were given a protected position. Our Royal Charter is founded on maintaining high standards and serving the public interest. These are laudable aims, but what do they mean in practice? Time has moved on and society’s expectations are increasing. The advances of technology are likely to move the balance of a chartered accountant’s work to be more advisory and forward-looking in the future. The ethical basis of how we do our work will become all the more important.

The ICAEW Code of Ethics includes five fundamental principles for professional accountants: integrity, objectivity, confidentiality, professional competence and due care, and professional behaviour. These are valuable insights and, when I speak to new members, I commend them as their touchstone of what it will mean to be a professional. However, living up to them and translating them into good decision-making in the difficult, and frequently stressful, circumstances of real life is not easy. The Code has a useful, and often overlooked, appendix that sets out a framework for ethical conflict resolution; but, inevitably, does not always offer an easy answer to the vital question, “What is the right thing to do?”

There is no substitute for rigorous analysis of the circumstances of the issue at hand and consultation with fellow professionals; but sometimes more guidance can help. The MG Rover disciplinary case raised concerns about members’ responsibilities relating to the public interest, conflicts of interest and fees.

Shortly before Christmas, ICAEW published a consultation on where further guidance on the requirements of the Code on these matters could usefully be given. It can be found at icaew.com/ethics. Comments are requested to ethicspolicy@icaew.com by 23 March 2016. If you have not already done so, read the consultation and give us your thoughts. ICAEW’s formal position will be finalised after full consideration of the responses received.

Andrew Ratcliffe is ICAEW president


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