A Practical Tool for Decision Making
"GPS Ethics Compass"
Integrity is a must-have quality for management accountants. Management of companies rely on the information provided and analyses made by management accountants to make strategic decisions. Management accountants should be conscientious in providing precise numbers without doctoring any information for ulterior motives. In addition, they should stay vigilant against corruption, fraud, malpractice and other unethical acts, and demonstrate moral courage to speak up and report any illegal acts or irregularities unveiled.
To help accountants arrive at a sound decision when encountering ethical dilemmas, the Hong Kong Business Ethics Development Centre (HKBEDC) has developed a practical tool, the "GPS" Ethics Compass. The Compass is like the Global Positioning System which shows them the right direction when navigating through different ethical challenges.
Guide your decision making with each of the four pointers of the following ethics compass before choosing the most appropriate course of action.
Legal requirements
Examples include the POBO, the SFO and the Companies Ordinance.Professional & self-values
Integrity, objectivity, professional competence and due care, etc. as defined in the COE issued by the HKICPA.
Rules & guidelines
Examples include the Listing Rules for listed companies, guidelines set by the organisation.Stakeholders' interests
Examples include the board, shareholders, investing public, employees, suppliers and customers.
Legal requirements
Examples include the POBO, the SFO and the Companies Ordinance.
Professional & self-values
Integrity, objectivity, professional competence and due care, etc. as defined in the COE issued by the HKICPA.
Rules & guidelines
Examples include the Listing Rules for listed companies, guidelines set by the organisation.
Stakeholders' interests
Examples include the board, shareholders, investing public, employees, suppliers and customers.Perform the roles of a management accountant properly:
- acquire, develop and analyse financial information honestly so that management has reliable figures on which to base their critical strategic decisions. Unethical management accounting could result in misleading numbers which may result in production stoppage, stock out, delivery delay, wastage, financial decline, reputation damage, etc.
- endeavour to put brakes on poor management strategies or decisions.
- report to the management and the relevant authority any unethical concerns, conflicts of interest, malpractices or illegal acts unveiled.
Sunshine test should always be applied to assess whether the issue under concern can be discussed openly and the decision disclosed without misgivings.
After going through the above steps, select an appropriate course of action which can maximise the important values and interests of all stakeholders. Make a commitment to the choice and implement it. Please refer to the "Toolkit on Directors' Ethics" (link as below) for more information and application of the "GPS" Ethics Compass:
