Big Four going extra mile for ethics

Workplace
By Eleanor O'Neill, Student Blog

31 July 2017

Big Four firms are leading the way in creating an ethical workplace environment, according to a survey of more than 900 accountants across the sectors of the profession.

'An Investigation of Ethical Environments of CPAs: Public Accounting Versus Industry' features in the spring issue of Behavioral Research in Accounting, a journal published by the American Accounting Association.

The paper suggests that accountants employed by the Big Four and other leading public accounting firms have a more positive perception of the ethical environment they work in. Industry accountants, on the other hand, reportedly find attitudes in the workplace to be more focused on commercial gains than business conduct.

The authors cite three possible reasons big firms seem to be making a more concentrated effort to promote ethics in the workplace:

Reputational risk

Public accounting firms, it would appear, are more conscious of the impact historical cases of ethics have had on both public and professional relations and perceptions.

The early 2000s had several headline-grabbing incidents that caused the downfall of major players in the sector. As such, accountability is a prominent issue in the profession and executive leadership structures face much more scrutiny under the public eye than in the past.

Training investment

Large firms are better placed to invest significantly in ethics training for employees - this leads to a more coherent and unified approach across the organisation.

The Big Four are known for promoting development and internal career progression, and there is a social impact from employees who have trained and moved up the ladder together, continuously applying the same standards of ethical code.

Potential penalties

A large firm stands to lose more if penalised for ethical misconduct than a smaller organisation targeted for the same transgressions due to the proportional impact of their actions.

In the US in particular, firms must also consider the opportunity for costly private legal action taken against them under such circumstances.

Source: CFO.com


The full journal article 'An Investigation of Ethical Environments of CPAs: Public Accounting Versus Industry' is available for purchase from the current issue of Behavioural Research in Accounting.

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