Lost in ethics

Sunday, 01 December 2013
Val Cox explores the resources available to help you navigate uncertain situations.

If a client is breaking the law, or you are asked to do something you know is illegal, you have clear procedures to follow to protect your professional reputation without breaching your fiduciary duties. What do you do when a situation feels wrong, but legislation gives you no guidance or protection?

As John Harper’s September 2010 column ‘The ethical trustee’1 points out, ethical investments are a minefield for trustees in any jurisdiction, with conflicts between fiduciary duties and clients’ attitudes to investments.

Trustees for charitable or non-profit organisations can also get into trouble despite good intentions. A recent Trusts Discussion Forum post2 highlighted the difficulties that museums can have with bequests. If a museum is struggling for funds, is it ethical to accept a bequest with the intention of selling it? Does it make a difference if the money will be used to repair the building and preserve the rest of the collection? Does the improvement outweigh the loss of future donations, if potential benefactors are offended by the sale of a gift?

For domestic practitioners, many members will have encountered situations where a client’s mental capacity needs to be assessed before instructions can be acted on. In jurisdictions where freedom of testamentary disposition is recognised, this is important before a will can be drafted. Do you risk offending a client by asking them to undergo medical assessment, when you know that a less scrupulous practitioner will offer to skip the assessment and win the client’s business? When a client is elderly or on their deathbed, does protecting them include allowing them to die intestate? What if that leads to someone the client wanted to support receiving nothing?

These sorts of grey areas are why many professional bodies now include ethics as part of their CPD. Regulators and training organisations can’t predict every scenario practitioners will encounter, so on many occasions clear guidance won’t be available.

How does studying ethics help?

As the STEP Journal and STEP News Digests regularly remind us, the landscape is changing rapidly through regulation and litigation. Discussion with peers can help, but what counts as best practice can change after a court decision or the introduciton of new rules.

The reasoning involved in establishing an ethical course of action gives practitioners a compass to use when they find themselves in uncharted territory; being able to defend your reasoning and show that you attempted to choose the course of action that did the least harm may be your best defence.

Where can you get more guidance on ethics?

STEP’s new CPD policy will require members to add ethics to their personal development plans on a regular basis. To get you started, STEP has made resources available to members through the CPD Centre 

The Alchemy Performance Assistant (formerly Alchemy for Managers) resource offers an ‘Ethics in Business’ module, written by Simon Webley of the Institute of Business Ethics. The module addresses various aspects of the subject, from boardroom strategies to encouraging the whole organisation to treat clients and suppliers ethically.

Many local legal and accountancy bodies produce seminars and publications that offer guidance relevant to their legislative environment. These count towards your STEP CPD requirement.

STEP has also commissioned interactive ethics case studies that allow you to explore different actions and the problems for each route. Members will be able to weigh up how to do the least harm to themselves and clients while staying within legal boundaries. Since ethical practice is defined differently depending on local legislation and custom, the case studies don’t attempt to define one ‘right’ path for all members worldwide.

As Voltaire said: ‘Doubt is not a pleasant condition, but certainty is an absurd one.’

In the absence of certainty, any tools that provide a little protection from future shifts in social attitudes or legislation are useful.

Author block
Val Cox

Val Cox is CPD Manager at STEP.

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