Robert M C Brown AM FCA

When I joined the accounting profession some 40 years ago it was the preserve of middle-aged men, conservative politics and the “old school tie”.

I clearly remember being expected to disclose my religion and school in order to win a graduate position at one of the “big eight” firms in Sydney. And the cleanliness of my (black) shoes was also a matter of considerable significance in the application process.

Comedian John Cleese reinforced this unattractive image in his description of us as “appallingly dull, unimaginative, timid, lacking initiative, spineless, easily dominated, no sense of humour, tedious company, irrepressibly awful… and whereas in most professions these characteristics would be considerable drawbacks, in chartered accountancy, they’re a positive boon”.

While unkind observers will suggest that the personality traits of chartered accountants haven’t changed all that much, there is no doubt that the professional and business environment in which we operate has changed a great deal.

The nature of this change became clear when I received (circa 1985) an unusual letter from the Institute (ICAA) about the future of our profession. It informed me that whether I liked it or not, the accounting profession had entered a new world of technology, marketing, commerce and economic policy in which chartered accountants would become CEOs and thought leaders.

As a result, the letter claimed, traditional professional partnerships were finished. These would be replaced by multi-disciplinary consulting businesses. These businesses would be built on the modern concepts of profitability and return on equity rather than the quaint notion adopted by previous generations of engaging in a trusted professional vocation in the public interest, irrespective of commercial reward. It was implied that if we didn’t “get with the programme” we would be left behind, reduced to low-value bookkeepers and compliance officers by the end of the twentieth century.

Of course, it’s hardly surprising that the accounting profession jumped onto the 1980s bandwagon. Those were the days in which powerful forces of deregulation, securitisation and globalisation were transforming much of the world. Societies became economies and economics faculties became business schools.

Self-interest

Over the following decades, the ascendancy of free market ideology, often known in our part of the world as “economic rationalism”, was assured on both sides of the Tasman.

According to Australian academic Michael Pusey, economic rationalism is a dogma which argues that “markets and money can always do everything better than governments, bureaucracies and the law. There’s no point in political debate because all this just generates more insoluble conflicts. Forget about history and forget about national identity, culture and society. Don’t even think about public policy, national goals or nation-building. It’s all futile. Just get out of the way and let prices and market forces deliver their own economically rational solution”.

This thinking was colourfully described by corporate cowboy Gordon Gekko in the 1987 film Wall Street who said greed was good, it was right and it worked.

So pervasive has been the influence of free market ideology, especially in the western Anglo-sphere, that many professional designations, including our own, have taken on the characteristics of product brands. This has coincided with the employment in professional associations of marketing managers and customer service specialists, many of whom simply apply their considerable expertise in the promotion of consumer products to the selling and protection of professional brands.

Furthermore, the focus of many professional associations has turned to membership retention and growth through their promotion of “member benefits” at the cost of their traditional emphasis on the articulation and enforcement of professional and ethical standards. The problem with this approach is that it leads to the conclusion that the reputation and commercial value of a professional brand must be protected and upheld “right or wrong” rather than to the conclusion that the public interest must be protected and upheld even to the detriment of the commercial interests of association members whose behaviour has been found wanting.

This misunderstanding of the proper role of professions in society has also led to the expectation among many members that their professional associations exist principally to protect and enhance their career prospects and commercial interests in a free market (as would a lobby group), rather than to protect the public interest in society as a whole.

So pervasive has been the influence of free market ideology, especially in the western Anglo-sphere, that many professional designations, including our own, have taken on the characteristics of product brands.

Vested lobby group

I was surprised to observe this confusion in the documents supporting the recently created Chartered Accountants Australia and New Zealand in which the following statement appeared: “Our aspiration is for the new institute to be recognised as the leading trans-Tasman voice for business.” The danger here is that by taking on the attributes of a vested interests lobby group, the public (whose interests our profession has hitherto claimed to serve) will conclude that chartered accountants are hypocritical and untrustworthy.

My key conclusion from this analysis is that at the heart of any true profession must be its members’ duty to society.

This is often called our duty to protect the public interest. It is a higher duty than our duty to act in our clients’ (or our employer’s) best interests and it must always receive priority in the ordering of our duties as professionals.

Simon Longstaff of the St James Ethics Centre explained it this way: “The point should be made that to act in the spirit of public service at least implies that one will seek to promote or preserve the public interest. A person who claimed to move in a spirit of public service while harming the public interest could be open to the charge of insincerity or of failing to comprehend what his or her professional commitments really amounted to in practice.”

Longstaff says if the idea of a profession is to have any significance, then it must hinge on this notion that professionals make a bargain with society in which they promise conscientiously to serve the public interest, even if to do so may, at times, be at their own expense. In return, society allocates certain privileges. These might include the right to engage in self-regulation, the exclusive right to perform particular functions and special status.

Given this unique and privileged role in society, it follows that when our organisation chooses to become involved in thought leadership and the development of public policy, our commentary must not be primarily motivated by a desire to engage in a public relations exercise or a brand management campaign.

Furthermore, we should never allow commercially motivated pressure from vested interests to dictate our conclusions.

Overarching purpose

Regrettably, we have seen the latter occur in recent years in our compromised attitude to ethical and professional standards in the financial services industry. I accept that avoiding these pressures is not always easy, especially when they are sourced from within our own profession. However, unless we do so, our members, government, the media and most importantly, the public whose interests we are privileged to serve, will devalue or ignore our contributions to important debates in which our profession’s voice should be heard and respected.

Therefore, as we grow and evolve the new Chartered Accountants Australia and New Zealand, we must renew our resolve to defend without fear or favour the fundamental principles on which our founding bodies were built. These are trust, integrity, objectivity, conflict avoidance, technical competence, due care, confidentiality, professional behaviour and uncompromised support of the public interest.

Of course, as chartered accountants, we can make important contributions to the creation of a more efficient economy, but that must never be at the expense of our overarching responsibility as a profession to the creation of a fairer society for all our citizens.

Robert M C Brown AM FCA is a member of the Australian Government’s Financial Literacy Board.

This article was first published in the November 2014 issue of Acuity magazine.