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Claudelle von EckChief Executive Officer of the IIA SA

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When professionals breach the Code of Ethics

Posted By Claudelle von Eck, 03 July 2016

Just the other day I was challenged by a member of ours who told me that he was very concerned about the fact that when we talk about intimidation we only do so in the context of the clients. What he meant was that we talk about internal auditors being intimidated by those they audit and never about intimidation within the internal audit fraternity itself. The former scenario has become very pervasive and does warrant our attention and intervention, hence the formation of the Anti-Intimidation and Ethical Practices Forum ( He is right though. Although not as pervasive, we do need to talk about those within the profession whose conduct bring the profession into disrepute.

The scenario this member sketched to me was that of a Chief Audit Executive who had breached the Code of Ethics and had started to victimise the said member because he had revealed the breach. Without giving the CAE the opportunity to defend himself, I cannot conclude that the story is true. However, it is not the first time that I’ve heard such an accusation. I find it rather disconcerting and I worry about the fact that there is often fire where there is smoke. One would like to believe that internal auditors are above reproach, but I guess it would be naïve to believe that there wouldn’t be any weak links in the chain.

In this context, it is important that we encourage internal auditors to continually measure themselves against the Code of Ethics. We should, in the process, not fall into the trap of thinking that ethics is only about not committing fraud or being involved in corruption (although these are very important aspects and not to be downplayed either). Unfortunately we tend to allow fraud and corruption to overshadow the discourse around ethics and miss other real ethical issues we face on a daily basis. For example, let me go back to the member I mentioned above. If a senior uses her position of power to intimidate or victimise a subordinate, that would be a breach of the Code of Ethics. Bullying, and thus ruling by fear, goes against the grain of professional conduct. Unfortunately many in leadership positions are often unaware of the fact that their bullying tactics are in actual fact unethical and they have a tendency of finding means to justify their behaviour in their own minds.

However, lest I be accused of picking on the leadership and creating the impression that bullying is only a top down behaviour, let me hasten to say that leaders could also find themselves in a position where they are being bullied or victimised by subordinates. I have first-hand seen the effects of a saboteur who attempted to assassinate the leader’s character, simply because he could not handle being told that what he had produced was not good enough. So, it is not inconceivable that a CAE may fall victim to a disgruntled subordinate. Needless to say, internal auditors who engage in character assassination (whether it is top down or bottom up) are in breach of the Code of Ethics and there is no justification for behaviour that is aimed at damaging an innocent person’s career and reputation. Let me also hasten to add that character assassination could happen in a deliberate manner, but also in an “innocent” manner through gossip. It is amazing how many people in senior positions do not think twice about tearing someone’s reputation apart behind their back, without one single thought dedicated to the fact that they are in breach of the Code of Ethics. I have to, of course, silently throw in a question around whether it is ethical to watch someone being victimised, bullied, intimidated and not say anything? Just asking…

Similarly stepping over the line by treating someone badly because of the colour of their skin, their gender, age etc. would be breaching the Code of Ethics. For those of us who have grown up in the South African context, vigilantly guarding against allowing our prejudices, born out of a shameful past, clouding our judgement and conduct is imperative. It is so easy to fall into the pattern of societal structures and contribute to the systemic challenges rather than being part of the solution - which often requires some sacrifice. If the Institute received a complaint against an internal auditor who has made some racist remarks, could we ignore it? Actually there are ethical implications in making racists remarks, thus directly speaking to the Code of Ethics. The same goes for sexism, tribalism, xenophobia etc. One would therefore expect that internal auditors would ensure that they do not breach the Code of Ethics by degrading others, no matter what background they come from. In the same vein, one would expect that internal auditors would ensure that there is no discrimination in how people are treated in their findings and recommendations. For example, it would be very disturbing if we were to find that an internal auditor goes all out to expose someone because she is of a different race while covering for those who are of the same race as he is.

Some examples of other areas where we could ask the question “is this ethical?” include:

  • Manipulating others by ‘massaging’ the truth. Very few things are as disconcerting as catching an internal auditor in a lie.
  • Utilising your position of power to force others to accept your position or ideology against their will.
  • Not owning up to mistakes and letting others be the scapegoat/fall-guy.
  • Being aware of unethical practices and not exposing them because you are afraid of what the cost will be to you personally.
  • Shooting the messenger because she carries an inconvenient truth.
  • Judging information based on who it comes from instead of interrogating the facts.
  • Asking others to break the rules so that your tardiness can be covered. Shockingly, at the Institute we have had to deal with requests that include issues like being asked to falsify documents, sneak in submissions after an absolute deadline, confirming employment of someone who no longer works for us etc. 

I could go on and on, but you get the gist of it. Adhering to a Code of Ethics is not as straightforward as it seems. It requires continual self-reflection and self-correction. We do however need to self-police too. When a professional breaches the Code of Ethics it is incumbent on her fellow professionals to report her to the Professional Body of which she is a member. One of the key roles of a Professional Body is to hold its professionals accountable against a Code of Ethics. I am proud to say that the IIA SA has all processes in place to meet this obligation. For more information on the Disciplinary Procedures, please go to our Bylaws on our website.

Tags:  AEPF  bullying  character assassination  Code of Ethics  discrimination  Ethics  fear  Internal audit  internal auditors  intimidation  leadership  Professional Body  racism 

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Lerato E. Chaba says...
Posted 03 October 2016
Thank you for this blog. It was informative and well articulated.
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