Ethics and trust in spotlight on global stage 

Who you are and where you are greatly impacts your ability to make ethical decisions. This important fact was hammered home at the recent Ethics Symposium sponsored by CPA Canada in partnership the University of Waterloo’s Centre of Accounting Ethics.  

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• Navigating Ethical Systems 
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The bi-annual event, which allows professionals from many sectors to share ideas and expertise, included insightful and thought-provoking discussions on topics such as responsible AI, trustworthiness and social dynamics in tax planning. But one of the key events led by Taryn Abate, director of research and thought leadership at CPA Canada and Brian Harward, principal research scientist at Ethical Systems, discussed CPA Canada’s recent paper Navigating Ethical Systems: How professional accountants can drive ethical behaviour.    

This research reaches beyond Canadian borders and is, indeed, a global issue. Undertaken in partnership with the Institute of Chartered Accountants of Scotland and the International Federation of Accountants, the research compares “who we are” to “where we are” and discusses the situational factors that impact a person’s ability to make ethical decisions. Based on a series of interviews with leaders in the accounting profession, the paper provides recommendations for professional accountants to drive ethical behaviour through the implementation of effective ethical guardrails and systems. 

“The increasingly complex set of norms that we must adhere to as part of the global community is only going to grow in the future,” says Abate. “That’s why we need to tackle this issue head-on and ensure that we set ethical systems to guide behaviour, align our processes and truly embed these ideals into our mindset at the highest levels.” 

Beyond the system 

The symposium also offered discussions that explored research on individual behaviours when responding to situational signals and pressures, in consideration of the systems they operate in. A panel exploring new research on trust between investment managers and clients looked at whether truthfulness in reporting positive and negative results impacted client trust. The research showed both positive and negative correlations between truthfulness of the investment manager and further investment from the client.  

A later panel explored the personal ethics of tax professionals when it came to engaging in, or avoiding, overly aggressive tax reporting practices. The academic study interviewed tax practitioners to understand the pressures that impact willingness to engage in tax practices starting “in the grey area” and moving up to illegal practices. Importantly, it highlighted the personal ethics that practitioners consider in these circumstances and the anxieties they face to ensure they are in-line with General Anti-Avoidance Rules.  

Racial equality in financial services  

CPA Canada has a long history of advocacy work in financial literacy, and the panel on research exploring racial biases in the consumer complaint disclosure and reporting processes in financial services particularly resonated with some of this advocacy work. The research and discussion highlighted the crucial role that public complaint disclosures in the U.S. can play in promoting financial equality on a global scale. When regulatory bodies in developed countries address consumer complaints, few, outside the United States, publicly disclose this information.  

The research highlighted that publicly sharing consumer complaint narratives can significantly reduce racial disparities in financial services.  

“The U.S. model provides a framework for addressing discriminatory practices, and financial literacy is a key enabler in this process” said Carolyn Goodwin, senior manager of Social Impact at CPA Canada. “Together, these initiatives can empower marginalized communities with the knowledge to advocate for fair treatment and navigate the financial system more effectively. Adopting the U.S. model, alongside increased financial literacy, is the right approach to create a fairer playing field for all.” 

You can find more details on the research papers and presenters here.