Owen Mavengere chartered accountant Ask any trainee or student studying towards a professional accounting qualification and they will give you a short answer on how to handle ethical dilemmas.
I remember many years ago saying ethical dilemmas have a simple response, just say no to the request to engage in any sort of illegal or immoral activities.
Fast forward to today, I still believe the same, but I have seen how practically there are so many considerations to be made.
Oftentimes, one might be tempted to take the easier option which might not necessarily be saying no, which I know only delays the inevitable.
In fact, when the chickens come home to roost when one agrees to bend their morality, the price is often higher than saying no in the first instance.
Last week I wrote about corruption and professional accountants.
I mentioned three factors as the reason why professional accountants may fail to stop an illegal or immoral transaction.
These were: Fear Ignorance about the underlying corruption and Being complicit.
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I have gotten some inquiries to expand and to take a practical approach to how one should respond when they have been put in an ethically challenging situation.
Ethical dilemmas in context Most leaders and managers will, at some point in their careers, be faced with a situation where they have to make a choice between doing what they know is right versus what will protect or propel their career.
This could be coming forward and owning up to a grievous and costly error, if no one else knows you are responsible, knowing fully well it may cost one’s job.
For this article I would like to focus on another scenario which I feel is far worse than the example I have given.
This would be when a professional has been requested to do something illegal or immoral.
This could be illegal in terms of the laws of the land or just against company policy.
I will further qualify this and highlight such a scenario to be coming from a senior and considerably more powerful official.
Accepting reality In my view, when one finds themselves in such a situation, it is important to accept the reality, which is that life is about to take some unplanned and uncomfortable turns.
This is critically important as it will help inform the next steps.
I also want to stress this because failure to acknowledge that there is going to be a price no matter what, might lead one to try and take the easier option in the hope that they can avert a disaster.
As earlier alluded, I have a slight bias towards unethical requests from senior officials.
Cost of unethical requests The cost of being thrust into what I feel is the centre of the storm, is that you will lose your integrity or your livelihood (or a potential improvement to one’s livelihood).
The reality of the ethical dilemma if one has been requested to break the law or company policy, is that should one comply, then one’s integrity is gone and further compounded to that, you may have a problem with the law.
It may lead to arrest or disciplinary proceedings from the company.
On the other hand, refusing to comply puts the individual at risk professionally.
It may be deemed to be career limiting to object to an unethical instruction The prospects of future promotions may diminish should the same powerful figures continue to have a say.
One may lose their employment, either straightforward dismissal or constructive dismissal.
The two possible scenarios are exactly what give rise to the whole idea of a dilemma.
One is between a rock and a hard place.
Proposed responses Having established that if the source of the undue pressure is powerful enough it can be tough situation, it is important to then consider possible options.
Resignation Staying in an environment that does not align to one’s moral code as well as the fundamental principle of ethics is not advisable.
The fear of losing a comfortable livelihood may deter most, but the reason why I specifically put a section called accepting reality, is to point out that that livelihood is lost already.
One can only somewhat control the descent should one walk away.
This also allows one to bounce back with their integrity and reputation intact.
Confronting the unethical request The Public Finance Management Act (Chapter 22:19) has an interesting set of guidelines under section 14.
I will borrow heavily from that for this section of the article.
The aforementioned act applies to the public sector but the provisions can easily be adapted to any environment.
The act requires that the recipient of an unethical request must submit in writing, their objects and the reasons thereof.
Should the instruction continue to be the same even after objections have been noted, then there is a need to inform certain gatekeepers in the public sector, such as the accountant general, auditor general and the secretary to Cabinet.
Such submission should include the instruction as well.
In the private sector, depending on the source of the instruction, options include the audit committee, external auditors, the board and so on.
Final thoughts I suppose the mere thought confronting the source of the ethical dilemma might be daunting for most, depending on who they are.
In order for the dilemma to be a serious one, then the source should ideally be powerful enough to make and fulfil serious threats therefore it might make confronting them a less favourable option for most.
The option of resigning allows one to silently draw attention, particularly if the replacement will react in the exact same way by resigning as well.
This will create a pattern which will likely result in some review being done on the responsible officials thus helping unearth an existing challenge.
Furthermore, there is an option to just refuse but still stay in the organisation.
I would think that it may work but the downside being risking future victimisation and working in a toxic environment.
In conclusion, one must never give up their integrity as a base, and from there analyse the specific circumstances and make a decision on how best to respond with the full knowledge that the ethical option has a price which may be clear, immediate and seemingly painful.
The unethical option may seem like the easier option but usually comes back to trouble the individual at some point in the future.
Mavengere is the technical manager at the Institute of Chartered Accountants of Zimbabwe (Icaz), which is the largest and longest standing PAO in Zimbabwe.
- ICAZ provides leadership on the development, promotion, and improvement of the accountancy profession focusing in the areas of accounting education, assurance, good governance practices and leadership and organizational excellence. — [email protected] or twitter: @OwenMavengere.
