Ethical Education in Accounting: Integrating Rules, Values and Virtues
particulars norms derive. Thus, in 1957, the Amer-
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Rules of social ethics
particulars norms derive. Thus, in 1957, the Amer- ican Medical Association replaced its Code of Ethics, which stated the duties that American physicians owed to their patients, their society, and to one another, with a statement of moral principles, sup- plemented by opinions and commentaries on spe- cific cases and questions (Roth, 1994, p. 695). This tendency is also perceived in accounting ethics, although in a much less extended fashion. Numerous accounting codes of conduct, espe- cially those in the USA, emphasize specific standards rather than generic principles. Thus, the Code of Professional Conduct of the American Institute of Certified Public Accountants (AICPA), revised significantly in 1988), 5 specifies that independence requires fulfilling the standards promulgated by bodies designated by the Council (Rule 101); objectivity and integrity involve being free of conflict of interests, and not knowingly misrepresenting facts and not sub- ordinating one’s judgments to others (Rule 102). This also occurs with compliance in the general standards and accounting principles (section 200); responsibility to clients, including issues related with confidential client information and contingency fees (section 300); responsibility to colleagues (section 400) and other responsibilities and practices (section 500). The Code of Institute of Management Accountants, much more succinct than the AICPA’s code, presents generic principles as well as a heading grouping the rules. In contrast, other codes, generally with a more international approach, stress general principles as a foundation for accounting ethics, without omitting, of course, specific standards of behavior. This is the case of the Code of Ethics for Professional Accountants of the International Federation of Accountants (IFAC) which highlights a crucial principle as the main reference for the whole code: the public interest. In the Introduction to this code it states: ‘‘The IFAC Board and the IFAC Ethics Committee believes that the establishment of a conceptual frame- work that requires professional accountants to identify, evaluate and address threats to compliance with the fundamental principles, rather than merely comply with a set of specific rules which may be arbitrary, is in the public interest.’’ 6 This code also includes a set of principles and values (technical and moral), with a brief explanation of each: integrity, objectivity, professional competence and due care, confidentiality, professional behavior and technical standards. 7 This emphasis on values and principles is made even sharper by an explicit recog- nition of the superiority of principles over the rules. The latter, according to this code, ‘‘may be arbitrary.’’ Considering the general principles that serve as a rule’s basis provides a broader perspective for ethical behavior in accounting. With this approach, it may well be easier to avoid a legalistic vision of ethics in accounting or a mechanistic application of rules in decision-making. Frequently principles adopted come from ratio- nalistic theories which propose diverse methods of moral reasoning to apply properly these principles for solving dilemmas or to justify certain actions. For Ethical Education in Accounting 99 this purpose, ethical education in accounting usually includes teaching several normative theories, such as Kantianism, Utilitarianism and other rationalistic ethical theories. These theories help to identify moral dilemmas and to provide a pathway for moral reasoning. These approaches reflect on the idea, implicitly or explicitly, that ethics in accounting, as in other matters, is an ‘‘application of ethics or morality (…) to practical issues’’ (Cottell and Perlin, 1990, p. x). Here, by ethics or morality it is understood that ethical systems or ethical theories, such as those above, are rooted in the philosophy of modernity and oriented to solve ethical dilemmas. Certainly, ‘‘identifying moral conflicts, thinking them through, discussing them with colleagues and others, and utilizing the tools of ethical analysis are useful, in fact, indispensable activities.’’ (Cottell and Perlin, 1990, pp. ix-x) No doubt exists that encouraging professionals or students to use ethical reasoning is valuable. But presenting Kantian theory, with its categorical imperatives or the Utilitarian principle of ‘‘the greatest happiness for the greatest number’’ or any other ethical theory based on apri- oristic principles of morality has some shortcomings. First, depending on the aprioristic principle ac- cepted, the action can be seen only as a set of duties (Kantian and Neo-Kantian theories) or only as the set of consequences (Utilitarianism, if they are evalu- ated in terms of satisfaction or consequentialism, if they are evaluated in terms of other chosen values). Authors in favor of understanding ethics only as duties criticize others that think only consequences are relevant. Contrasted with these approaches, many people consider relevant both the action itself and also the action’s foreseeable and avoidable consequences. Second, well-known post-modern philosophers, such as Derrida, Foucault, Lyotard, Wittgenstein, Rorty and others, repudiate all these aprioristic the- ories, because they believe that modern philosophy, including Kantianism and Utilitarianism, err by accepting the unshakable foundation of knowledge. From a different perspective, an Aristotelian critique can also be made against the foundations of modern moral theories (Duska, 1993). Third, even though teaching these theories develops students’ skills in solving ethical dilemmas, applying theories and determining what is right according to a set of duties or systematically ana- lyzing the consequences, this does not motivate students to act well. Ethics cannot become so mechanical as merely applying a rule, a ‘‘technol- ogy’’ for solving moral dilemmas. In teaching busi- ness ethics, Cooley (2004) has observed that students memorize enough of the moral theories to pass their tests, but never understand the motivating spirit underlying the theories. He concludes that students know how to apply the moral principles to various situations, but produce the wrong results due to their illicit biases and rationalizations. Fulfilling your (self- evident) duties (Kantianism) or calculating the con- sequences in terms of satisfaction (Utilitarianism) does not seem enough for ethical behavior, because human behavior is far more complex than accepting aprioristic principles and knowing how to apply them. As will be discussed afterwards, motivation and habits are also very important for correct behavior. The fourth shortcoming has to do with the lack of consideration of the decision-maker’s character in moral reasoning (Anscombe, 1958; MacIntyre, 1984; Veatch, 1968; among others). Since the enlightenment, modern moral philosophy has emphasized duties and norms without examining the personal disposition of the person making the moral judgment in a concrete situation and without con- sidering the habits acquired by deciding and acting in a certain way. In contrast to modern moral philos- ophy, the Aristotelian view argues that moral judg- ment ‘‘is not merely an intellectual exercise of subsuming a particular under rules or hyper-norms. Judgment is an activity of perceiving while simul- taneously perfecting the capacity to judge actions and choices and to perceive being’’ (Koehn, 2000, p. 17). This vision contrasts with Kantian theory and Utilitarianism, which, as has been pointed out, take for granted this capacity and consider it irrelevant in making moral judgments. Values and virtues Teaching values could also counter a concept of ethical training reduced to a mere application of rules or the shortcoming of the rationalistic theories mentioned before. Values can also go as far as providing a motivation to act well. 100 Dome`nec Mele´ ‘‘Value in general may best be glossed as that which is worth having, getting, or doing (. . .) Value, thus understood, is essentially relational, i.e., it is value for some person(s) or living being(s) ’’ (Bond, 2001, p. 1745). Values, in the context of business, belong to whatever is necessary, or makes a positive contribution, for maintaining and improving busi- ness, as human activity. These include moral values, which express what is worth for a human activity. Many codes present the grounding values. Thus, the AICPA Code includes the following values: service to others or public interest, competency, integrity, objectivity, independence, professionalism, including continuing education, and accountability to the profession, which are similar to considerations that appear in most professional codes (Duska and Duska, 2003, p. 77). For its part, the Standards of Ethical Conduct for Management Accountants of the NAA of the USA defined the ethical responsibilities of managers through four values: competence, confidentiality, integrity and objectivity. Afterwards, this code was the basis for the current Standards of Ethical Behavior for Practitioners of Management Accounting and Financial Management adopted in 1997 by the Institute of Management Accountants (the former National Association of Accountants), 8 which also presents these values, although they add a fifth section devoted to resolving ethical conflicts. But values are not enough. Accountants, as with every professional, have to make practical judgments about concrete situations and, above all, have to behave correctly. Both conditions require not only bearing values in mind but having good character, as we will try to explain later. Pioneers in ethical education in accounting, in spite of their praiseworthy task, focused on dilemmas and ethical theories rather than on the role of virtues. This is the case of Loeb (1988), Langenderfer and Rockness (1989), and others at the end of the 1980s. 9 Although Loeb (1988, p. 322) included ‘‘setting the stage for’’ a change in ethical behavior, ‘‘he does not go so far as to imply accounting edu- cators have the power to bring about good or bad behavior on the part of students.’’ (Armstrong et al., 2003, p. 10) Similarly, from a practitioner perspective, up until recently, perhaps the only virtue, at least implicitly stressed, is the disposition to fulfill the obligations prescribed by code or by normative ethical theories. Thus, the Standards of the Institute of Management Accountants states: ‘‘Practitioners of management accounting and financial management have an obligation to the public, their profession, the orga- nization they serve, and themselves to maintain the highest standards of ethical conduct.’’ Several scholars have strongly criticized those approaches which reduce ethical education to pre- senting ethical theories to solve ethical dilemmas without considering personal virtues and behavior. Pincoffs (1986, pp. 4 )6) pointed out the problems with theories used to solve ethical dilemmas. He stated deontological or utilitarian ethical theories are reductive, since they eliminate what is morally rel- evant (character) and they legislate the form of moral reflection (duties and consequences). In similar terms, Shaub (1994) focused on several potential weaknesses in implementing accounting ethics education in the classroom and criticized the current overreliance on ethical dilemmas. As an alternative to teaching ethical theories, Pincoffs (1986, p. 150) presented the primary objective of moral education as encouraging the development of the person. This means encouraging the development of virtues, that is to say, permanent dispositions that favor ethical behavior. Subsequently, other scholars have presented sig- nificant insights into the role of virtue in accounting, both in practice and education. Francis (1990) emphasized the role of the agent beyond rules and the capacity of accounting to be a virtuous practice. Mintz (1995, 1996), following Pincoffs (1986) and McIntyre (1984), presented significant pedagogical insights in the teaching of virtue to accounting stu- dents and mentioned several virtues which enable accountants to withstand environment pressures and to act in accordance with the moral point of view: (1) benevolence and altruism; (2) honesty and integrity; (3) impartiality and open-mindedness; (4) reliability and dependability; (5) faithfulness and trustworthiness. The crucial importance of the agent’s character Regarding practical judgments, Armstrong (2002, p. 145) affirms that ‘‘accounting is an art, not a science. It requires significant judgments and assumptions and 10 Ethical Education in Accounting 101 accountants, given complex circumstances, will probably arrive at several different net income or taxable income figures.’’ Accountants must determine the significance of each situation while acting with objectivity, independence, professional competence, due care, confidentiality, professional behavior, con- fidentiality, integrity, and so on. Rules cannot deter- mine what to do in every situation. Universal principles can give guidelines, but each situation is unique. Accountants have to judge each situation and judge what objectivity, integrity, etc. mean in a given situation; and then act according to this judgment. It has been rightly said that a ‘‘practical judgment is, at the very least, crucially dependent upon per- ception’’ (Koehn, 2000, p. 4). The ethical percep- tion depends on certain human capacities, related with character, which is different from others, such as logic or aesthetics. This capacity to perceive the ethical dimension of the reality is no more than practical wisdom or prudence (in the moral sense), an intellectual virtue, called ‘‘phronesis’’ by Aristotle (Nichomachean Ethics, bk 5, chap. 7). Practical wis- dom may be expressed, for instance, in being sin- cerely objective, truly unbiased and independent, and in following the ‘‘spirit of the law’’ rather than the letter of the law. Character of a person, in which practical wisdom forms an important part, is made up of habits (good habits, or virtues, or bad habits, or vices). Habits shape personal character, which combines with personality (understanding by personality mainly the innate features and non-moral qualities). Aristotle described personality as the following: ‘‘virtues we get by first exercising them, as also hap- pens in the case of the arts as well. For the things we have to learn before we can do them, we learn by doing them, e.g., men become builders by building and lyre-players by playing the lyre; so too we become just by doing just acts, temperate by doing temperate acts, brave by doing brave acts (…); by doing the acts that we do in our transaction with other men we become just or unjust, and by doing the acts that we do in the presence of danger, and being habituated to feel fear or confident, we become brave or cowardly.’’ (Nichomachean Ethics, bk 2, chap. 1; 1103a31 and 1103b15) The virtue of man is ‘‘the state of character which makes a man good and which makes him do his own work well.’’ (Nichomachean Ethics, bk 2, chap. 6; 1106a22). In other words, virtuous individuals habitually perform moral actions. Thus, courage drives us to do what is good and justice to give to each what is his or hers by right. To sum up, virtues should be introduced in eth- ical education as a crucial element to overcome the limitations previously discussed. However, a new problem arises: how to harmonize virtues with rules and values. Some versions of ‘‘virtues’’ only judge as virtues those which foster outcomes: industriousness for a productive life: justice for achieving good relations: loyalty to maintain a sound adhesion: truthfulness to garner more the reputation of being a reliable person. Similarly, for some authors virtues are virtues only if they are accepted in a particular context. Thus, Solomon, defines virtue as ‘‘a per- vasive trail of character that allows one to ‘‘fit into’’ a Download 195.26 Kb. Do'stlaringiz bilan baham: |
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