This section will focus on personal and professional ethics and the responsibilities of CIMA students and members, including an introduction to public interest in relation to their role as professionals. This section will finish with a short ethics awareness test and provide links to relevant resources.
Why ethics are important to accountants
As Chartered Management Accountants CIMA students and CGMA designation holders throughout the world have a duty to observe the highest standards of conduct and integrity and to uphold the good standing and reputation of the profession. They need to uphold the Code of Ethics and apply it in their working lives. This Code outlines the behaviours and conduct that is expected of students and members in doing the right thing.
The CIMA Code of Ethics is based on the International Federation of Accountants (IFAC) Code of Ethics for Professional Accountants. Part C of the Code was developed in cooperation with the AICPA. It is a global Code that is followed by accountants in business and in practice worldwide.
IFAC’s definition of the ‘Public Interest’ is: “The net benefits derived for, and procedural rigor employed on behalf of, all society in relation to any action, decision or policy”. ‘Public Interest’ is also generally understood to refer to the ‘common well-being’ or ‘general welfare’ of the public.
Ethics of a profession can be simply the description of the prevailing standards of ethical behaviour - of doing the right thing. Ethics is often used interchangeably with the term morals. But there is a difference. Whilst both are concerned with what is the right thing to do in a situation, morals may resolve problems with reference to an individual's personal belief system about what might be right or wrong.
Unethical behaviour has consequences and may affect the accountant, personal and organisational reputation, financial viability and the overall business efficacy of an organisation. A management accountant needs to consider ethical implications in order to provide the basis for decision making.
Why the public interest matters
A growing number of corporate scandals have made it clear that unethical business practice does not work in the long term. The past few years have highlighted the costs of acting unethically, with a spate of business failures, high public distrust and now, increasingly, public protest against corporate and government wrong doing.
The role of the management accountant and CIMA
As well as educating and regulating its students and members, CIMA also has public interest responsibilities to uphold both through its own work and through the actions and behaviours of the CIMA community.
CIMA is committed to upholding the highest ethical and professional standards and to maintaining public confidence in management accounting. All students and members are expected to comply with the Code. Therefore, as you go through your studies you will be expected to demonstrate, at all stages of exams, your understanding of the Code. This will continue through your working life. Acting ethically and keeping your knowledge up to date helps you stand out as a professional.
Responsible business practices are becoming increasingly important in today's interconnected and data-driven world. View our ethics and responsible business resources to learn more.
A management accountant's role is to provide the crucial information that forms the basis of decision-making within an organisation. If work is undertaken badly or in bad faith there can be wide-ranging consequences. Unethical behaviour can affect not only the accountant (perhaps resulting in disciplinary action against the individual by CIMA), but may also affect the jobs, financial viability and business efficacy of an organisation in which the accountant works.
CIMA Official Study Text, Paper BA4, Kaplan Publishing