CONSEQUENCES OF UNETHICAL BEHAVIOUR CONSEQUENCES OF UNETHICAL BEHAVIOUR CONSEQUENCES OF UNETHICAL BEHAVIOUR CONSEQUENCES OF UNETHICAL BEHAVIOUR CONSEQUENCES OF UNETHICAL BEHAVIOUR

5.65.6 5.6

5.6 CONSEQUENCES OF UNETHICAL BEHAVIOURCONSEQUENCES OF UNETHICAL BEHAVIOURCONSEQUENCES OF UNETHICAL BEHAVIOURCONSEQUENCES OF UNETHICAL BEHAVIOURCONSEQUENCES OF UNETHICAL BEHAVIOUR

The consequences of unethical behaviour are reflected not only on the individual but also on his profession, his professional body and indeed the society at large.

The first thing to consider here is, what constitutes an unethical behaviour. An understanding of ethics could be presumed to be a pre-requisite of understanding what can constitutes an unethical behaviour.

In a study involving different categories of players in the financial services industry, Adewunmi (1998) was able to identify various types of description of unethical behaviour. Some of them that are of general application are:

(a) Any act or behaviour which is not in consonance with professional code of conduct;

(b) Behaving in ways outside the moral principles or ethics which govern a certain profession;

(c) Any act that does not follow the norms of a profession;

(d) A behaviour that negates the code of conduct guiding an operation.

(e) Any attitude that is not in consonance with the accepted norms;

(f) A conduct that is morally adjudged wrong, unbecoming and below expectation;

(g) Behaviour that is not based on moral principles;

(h) Deviation from standard and known norms; and (i) An act that is not normally right.

The above list shows clearly that in each case, there has been an attempt to see unethical behaviour as the opposite of ethical behaviour. The major attributes of unethical behaviour refer to failure to comply with the expected normal moral standards of a profession. It is simply aprofessional misconduct.

The consequences of failure to comply with the ethical standards of a profession can be clearly identified from the Code of Conduct or Code of Ethics of that profession. Using the ICAN Code and chartered accountants as an illustration here, the section on Enforcement of Ethical Standards is reproduced below:

“This statement shall apply to all members:

1.1 The power of the Institute to enforce ethical standards is by the ICAN Act conferred on the Accountants’ Disciplinary Tribunal which is in respect of this power independent of the Council.

1.2 The Investigating Panel considers complaints against the conduct of members, and is empowered to initiate disciplinary action by referring

1.3 Where a complaint is received by the Institute alleging a case of misconduct against a member, such a member shall be requested by the Investigating Panel to furnish his defence or reaction to the complaint within 14 days of the receipt of the request to do so if the member is resident within Lagos State or twenty one days if the member is resident outside Lagos State.

1.4 If the member fails to respond within the specified time, a first reminder shall be sent to him requesting him to send his defence/reaction within 7 days from the receipt of the reminder. If the member fails to respond again, a second reminder shall be sent to him requesting him to send his defence/reaction within seven days ultimatum within which to reply and a warning that non-response shall amount to contempt of the Institute and is sanctionable by the Disciplinary Tribunal.

1.5 If the member fails to respond after the second reminder, a formal charge of contempt shall be preferred against the member before the Disciplinary Tribunal.

1.6 The provisions and/or procedures contained in paragraphs 1.4 and 1.5 above shall apply to any other requirement or directive of the Panel to a member so much so that failure or neglect by the member to abide by the requirement or directive shall also be treated as contempt of the Institute and could be sanctioned by the Disciplinary Tribunal.

1.7 If having considered the facts before it, and any representation made by the member, the Panel is of the opinion that in all the circumstances those facts amount to misconduct and is of the further opinion that disciplinary proceedings should be brought, it will prefer a formal complaint to the Disciplinary Tribunal. Alternatively, the Panel, if it considers that the case does not call for the most serious sanctions, may make certain orders against him.

In cases which give rise to or include questions of public concern, the Panel may alternatively refer the matter to the Disciplinary Tribunal.

1.8 It is the Disciplinary Tribunal which, alone, can determine, subject to the right of appeal referred to below, whether a complaint of misconduct is proved.

1.9 Where a complaint is against the conduct of a firm having more than one partner, the complaint shall be deemed to have been made against each and every member who was a partner in the said firm at the material time, for the purposes of this statement.

1.10 From the Accountants’ Disciplinary Tribunal, a member has a right of appeal to the Court of Appeal (See Section 12(5) of the ICAN Act).

Any failure to follow the guidance in the Fundamental Principles or in the Statements may also be taken into account by the Committee of the Institute responsible for regulating the work of members and member firms (ICAN, 1999, pp.79-80)”.

The Accountants’ Disciplinary Tribunal has powers equivalent to those of a High Court and that is why any appeal against its verdict goes to the Court of Appeal, and thereafter to the Supreme Court. Consequently, the normal rules of evidence are applicable; all complaints should be in writing while any accusation against any member should be substantiated with documentary evidence.

Sanctions which are commonly imposed by the Institute for misconduct include the following:

(a) Reprimand;

(b) Payment of costs;

(c) Fine;

(d) Withdrawal of practising rights;

(e) Suspension from membership for a period of time; and (f) Expulsion from membership.

The above consequences could be seen as affecting the individual chartered accountant alone. However on a deeper reflection, it will be observed that the profession as well as the entire society would have suffered one form of disadvantage or the other if a single professional accountant has been found guilty of professional misconduct.

Some of the disadvantages to the profession and society are:

(a) Each time a professional accountant (or any other professional for that matter) is found guilty of misconduct, any type of sanction meted out to him has ripple effects on his immediate family, business and the economy. He might have ended up losing his practising licence or getting his name struck off from the register; this is a loss of income for him. If serious enough, his professional misconduct could have affected the going concern status of his firm.

(b) A misconduct of a professional that affects the going concern status of his firm affects the various stakeholders in that firm. For example, the creditors may not be able to receive all that is due to them, the partners may lose either all or a substantial part of their capital while the employees as a whole may lose their jobs.

(c) The economy suffers from this type of scenario, the loss of income to government either on the employees’ personal income tax or the partners’ income tax (if in partnership).

(d) Any or all of the above situations will have adverse effect on the particular profession of the affected individual.