Ethics Audit

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Ethics Audit

An investigation into how well (or poorly) a company conforms to the ethical standards of its industry or society generally. An ethics audit may consider the company's own practices, how it redresses grievances, how it discloses its finances, whether it punishes whistleblowers, and even the general cultural surrounding its business dealings. Some companies may formally adopt a code of ethics and conduct periodic ethics audits to see how closely they follow their own rules.
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To be effective, ethics audits must be performed by an independent third party.
Step six is to conduct annual ethics audits, to ensure that an overall program is current and functioning as intended, and that employees across locations and departments are informed and in compliance.
Their responsibilities have expanded significantly to include strategy audits, ERM audits, ethics audits, operational audits, quality audits, IT audits, supplier audits, and due diligence in mergers and acquisitions.
Initial findings from a fivepart survey show that over the next five years, internal auditors will focus more on corporate governance, ERM, strategic reviews, ethics audits and the migration to international financial reporting standards, and put much less emphasis on operational and compliance audits, auditing of financial risks, fraud investigations and internal controls evaluation.
McAuliffe observes that the concept of "ethics audits" in Australia does not appear to have been developed to the point of creating a useful process or tool that could have adaptability to frontline professional practice in human service organisations.
* Regardless of the location or culture, the types of audits most commonly conducted include operational audits, investigations of fraud and irregularities, financial audits, management effectiveness audits and ethics audits; with the greatest projected increase being in risk management and governance.
These include using ethics screening techniques during hiring, including ethics in the performance appraisal process, conducting ethics training, and accomplishing periodic ethics audits. Aspects of these largely instrumental techniques recur throughout the remaining articles in Part Two.
A comparable tool can similarly facilitate social workers' efforts to conduct ethics audits.
Knowing that financial audits sometimes provide a misleading picture of the health of the firm whose books are examined, must we not then assume that ethics audits would fall similarly wide of the mark?
Other exercises involve customizing a code of ethics to a particular police agency(6) and forming a simulated ethics committee to conduct ethics audits and to define the ethical principles needed in policing.(7) In a particularly effective and popular exercise, officers view and discuss videotaped scenarios or role-play similar scenes that highlight ethical dilemmas.
"Ethics" resources consist mainly of a large collection of websites and a few articles on ethics audits. The "Internal Auditor Competency Framework" contains four outstanding Excel charts describing the level of knowledge, skills, and competency required of internal auditors from new staff to chief audit executives.
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