Ethical Insights: How and what you disclose matters

In this series of conversations about ethical leadership, we speak with high profile ICAS members who have reflected on what it means to do the right, or ethical thing throughout their careers. It is hoped that the conversations provide practical guidance to help anyone in a challenging professional situation where they are required to seek the truth and then act.

As well as interviewing these ICAS members individually, under Chatham House rules, we also surveyed our members in a quantitative survey during 2024, conducted by Dodds & Law Research Associates. We received 710 responses from a survey of 10,000 members and we have taken some of the results and findings and used them in this report to highlight the wider views of members.    

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Insight four

In this fourth instalment of our ethical insights series, we examine disclosure and the attitudes that surround it. Much like your integrity and personal brand, your transparency and openness reflect in your reputation. Are you honest and fair in sharing key details? How do you respond when you can’t disclose sensitive information? The answers to these questions may reveal if you truly represent the CA values.

Organisations are often complex and imperfect and do not easily lend themselves to clear explanations to market – which is why market participants will often look to read between the lines of a set of accounts. In a corporate context - where there may be price sensitivity and nuance as well as pressure to present the numbers in a certain way - what matters is that you can sleep at night:  

“When I was the CFO of a listed company one of the tricky challenges was what to present to the City when announcing results. You have an ethical responsibility to give a fair picture, and the accounts provide a true and fair view, but the analysts and journalists are also trying to get a sense from you as to what to make of the numbers. There are of course a whole series of adjectives and adverbs you can use but the philosophy I developed was that people must come away with the right flavour. What that meant was, whether we had had a good or bad trading period, my comments needed to be clear that this had been the experience.” 

“As a CFO there were times when I was not allowed to tell people things - because the information may have been confidential or market sensitive. In these circumstances the challenge was how to give an honest response when you are constrained in what you can say? Here what matters is that you do not mislead even if you cannot fully disclose.”

 

There are also circumstances where your disclosures may need to depart from the numbers to provide a more comprehensive view of company performance:  

“I think ethical questions these days are less around disclosure and more about how we use the right words to describe what is happening. If you look at the numbers themselves the margins might look really good. If, however, this is because you got a one-off rebate from a dispute 10 years ago that reduced costs, you need to be able to explain that the 25% margin is only 23% because we got this rebate. For me ethics is much more around the disclosures of things that aren't necessarily in the accounts but affect people's view of the business.”

“A lot of it is about expectation management. I like to talk about ‘Bookends’. One Bookend could be high as this – the other end could be as low as that. If you can explain to people the dynamics which are likely to move the results in either direction I think that is half the battle. Regardless of the final outcome you and your team are held with trust and respect because you've taken the time, in advance, to educate and explain, and people understand.” 

 Stay tuned for more of our Ethical Insights over the coming months

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