The 2020 Edelman Trust Barometer, a quantitative measure of public trust, finds that the global business trust level is 58%, which indicates that almost 40% of the surveyors based out of 28 countries do not trust business enterprises. Inequality of economic success and uncertainty of the future are usually considered two primary reasons for distrust. Experts believe that CFOs can play a crucial role in rejuvenating and cultivating trust in businesses. Experts invest so much faith in CFOs because they think that finance is ultimately responsible for safeguarding stakeholders’ interests, including protecting and fulfilling the demands of stakeholders, customers, and society at large. In his article for ‘Forbes,’ Jeff Thomson shares certain ways to build an ethical business.
Leading by Example
There are many organizations where the top decision-makers inspire the professional work model and work culture. But suppose certain CFOs execute their roles or responsibilities in an unethical manner. In that case, they serve as a poor example to their subordinates, which can lead to a downward chain of unethical behavior. A CFO must not only preach but also lead by example. It is a CFO’s responsibility to exercise ethical practices while clarifying what unethical practices are and why you should avoid them.
Distinguishing Between Ethics and Compliance
CFOs should be able to understand and educate their subordinates about the distinction between ethics and compliances. Just because something falls in the legal framework does not mean an individual or enterprise should access or explore it, keeping the ethical aspect at bay. Financial reporting that misleads the information or does not provide accurate or complete information constitutes a moral lapse. Just like a doctor’s ‘Hippocratic Oath’ of ‘do no harm,’ CFOs should take the oath of being transparent with their shareholders and consumers.
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