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Framework for resolving ethical problems

Framework for resolving ethical problems

A framework to help resolve ethical problems starting with identifying the problems and parties involved to implementing the course of action and monitoring its
progress.
When trying to solve an ethical problem, you may find it useful to refer to the following framework, which is based on the framework included inICAEW's Code of Ethics
(/en/membership/regulations-standards-and-guidance/ethics).

ICAEW framework - how to resolve ethical problems

1) Gather the relevant facts and identify the problems
Do I have all the facts relevant to the situation?
Am I making assumptions? If so, could facts be identified to replace these assumptions?
Is it really your problem? Can anybody else help?

2) Identify the affected parties

Who are the individuals, organisations and key stakeholders affected?
In what way are they affected?
Are there conflicts between different stakeholders?
Who are your allies?

3) Consider the ethical issues involved

Have you referred to ICAEW's Code of Ethics?

What are the professional, organisational and personal ethics issues?

Would these ethical issues affect the reputation of the accountancy profession?
Would these ethical issues affect the public interest?

4) Identify which fundamental principles are affected

What are the threats to compliance with the fundamental principles of:
Integrity
Objectivity
Professional competence and due care
Confidentiality

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Professional behaviour
Have you considered the following threats?
Self interest
Self-review
Advocacy
Familiarity
Intimidation
If so, are the treats to compliance with the fundamental principles clearly insignificant?
Are there safeguards which can eliminate or reduce the threats to an acceptable level? Safeguards can be created by:
Profession, legislation and regulation
Work environment
Individual

5) Refer to the employing organisation's internal procedures

Does your organisation's policies and procedure provide guidance on the situation?
How can you escalate concerns within the organisation? Who should be involved, in what role and at what stage?
Does the organisation have a whistleblowing procedure?

At what point should you seek guidance from external sources such as ICAEW

6) Consider and evaluate alternative courses of action

You should consider:
Your organisation's policies, procedures and guidelines
Applicable laws and regulation
Universal values and principles generally accepted by society
Consequences
Test your proposed course of action. Ask yourself the following questions:
Have all the consequences associated with the proposed course of action been discussed and evaluated?

ICAEW

Is there any reason why the proposed course of action should not stand the test of time?
Would a similar course of action be undertaken in a similar situation?
Would the suggested course of action stand to scrutiny from peers, family and friends?

7) Implement the course of action and monitor its progress

When faced with an ethical issue, it may be in your best interests to document your thought processes, discussions and the decisions taken. Written records will be useful if
you need to justify your course of action.

Other frameworks
In addition to ICAEW's framework for revolving ethical problems, there are a number of other frameworks for resolving such problems which you may find helpful.
Carter McMamara - Ethics Toolkit for Managers (http://www.managementhelp.org/ethics/ethxgde.htm)
Ethics Resource Center - The plus decision making model (https://www.ethics.org/eci/research/free-toolkit/decision-making-model)
Institute of Business Ethics - Simple Ethical Tests for a business decision (http://www.ibe.org.uk/index.asp?upid=63&msid=11)
Jon Pekel and Doug Wallace -The Ten Step Method of Decision-Making (PDF 101KB/13 pages) (http://www.authenticityconsulting.com/misc/long.pdf)
Josephson Institute of Ethics - Making Ethical Decisions (http://josephsoninstitute.org/MED/)
Markula Center for Applied Ethics - A framework for thinking ethically (http://www.scu.edu/ethics/practicing/decision/framework.html)
SME Financial Systems (http://www.sme.ie/articles/business_ethics/decision_making_frameworks.pdf)

Useful links
Code of Ethics (/en/membership/regulations-standards-andguidance/ethics)

APB Ethical standards (http://frc.org.uk/Our-Work/Codes-Standards/Auditand-assurance/Standards-and-guidance/Standards-and-guidance-forauditors/Ethical-standards-for-auditors.aspx)

Bribery Act 2010 (/en/technical/legal-and-regulatory/business-crime-andmisconduct/bribery-and-corruption/bribery-act-2010)

Aggressive tax avoidance (http://www.ion.icaew.com/TaxFaculty/25014)

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Tax conduct (http://www.ion.icaew.com/taxfaculty/post/professionalconduct-in-relation-to-taxation)

Latest articles
Consultation on guidance on aspects of the ICAEW code of ethics
(/en/technical/ethics/consultation-on-guidance-on-aspects-of-the-icaewcode-of-ethics)

Implementation of European Audit reforms (/en/technical/ethics/auditorindependence/implementation-of-european-audit-reforms)

tax contingent fee (/en/technical/ethics/auditor-independence/end-of-taxcontingent-fee-transitional-arrangements)

Corporate Finance non-audit services (/en/technical/ethics/ethics-inpractice/practice/corporate-finance-non-audit-services)

Trustees where an audit connection (/en/technical/ethics/ethics-inpractice/practice/trustees-where-there-is-an-audit-connection)

Ethics and Retail Distribution Review (/en/technical/ethics/icaew-code-ofethics/icaew-code-of-ethics-and-the-retail-distribution-review)

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