Kari Moore
Unit 6 – Final Research Paper
AC504
April 19, 2013

Abstract
In the history of the world, there has never really been a dominate, widely accepted set of ethical standards, unless you count the ten commandments, and as we all know, they didn’t end up widely accepted either. The world is in an ethical tail-spin, trying to be the best, the most profitable, the most dominant, and it is leaving its ethics in the dust. In this paper I will discuss the importance of an ethical system, a global set of ethics, and discuss the pros and cons on a global system.

Global Ethical Standards In a perfect world, there would be a single set of standards for everything, taxes, banking, business, accounting, etc. We don’t live in a perfect world, period. We live in a world where ethical decisions stare us in the face every day, some of the decisions are easy, and some aren’t. It is how we deal with them that defines us, and makes us who we are. In the United States history, mainly in the last decade or so, we have made some very bad ethical decisions that have cost many people their jobs, their livelihoods, their retirements, and most importantly, their faith in the system that is supposed to protect them. You might ask yourself, “Shouldn’t these people know better?” The answer isn’t so clear, we hold the men and women in charge to a higher standard because, simply, they are in charge. The truth is, that just like people, every ethical decision is different, and everyone has a different belief on what is acceptable and what is not. In the last decade, a lot of people have decided that if they can get away with it today, than it must be ethical and they will worry about the rest tomorrow. That has created a lot of problems, and some think that a global set of ethical standards will rectify that. A global set of standards would be a “golden rule” if you will, it will let everyone in every business around the world know, what is acceptable and what is not. Would it work? Who knows, I guess we will worry about that tomorrow… In, the history of the world, I doubt there has ever been a global set of ethical guidelines, unless that is, you count the ten First, let’s have a little history lesson, the history of the AICPA and the IFAC that is. The AICPA, (American Institute of Certified Public Accountants) was created over one hundred years ago and the main goal of the organization is to protect investors and create a fair, orderly, and efficient market, (Melancon, B.C.). The AICPA has over 375,000 members in 128 countries around the world, and their missions is to provide members with valuable tools in the best manner to benefit the public, employers, and clients, (AICPA.org). The AICPA sets guidelines and standards for a large number of services, which include: * Auditing and Attestation * Professional Conduct * Compilation and Review * Consulting Services * Continuing Professional Education * Peer Review * Personal Financial Planning Statements * Tax * Valuation Services, (AICPA.org).
These standards go a long way to help certified public accountants who are members of the organization, know what is acceptable and what isn’t when it comes to the services that they provide to their clients. CPAs want to belong to this organization because it gives them insight into new regulations, connects them with other CPAs, helps them continue their own education, and gives them an outlet to solve problems, and stay on top of current situations that may or may not directly apply to them. It is an invaluable service to a CPA that will help them further their career. The IFAC (International Federation of Accountants) was founded in 1977, in Germany at the 11th World Congress for Accountants. The IFAC was created to: * Develop high quality international standards in auditing and assurance * Promote cooperation between the members * Promote cooperation between other international organizations * Serve as the international spokesperson for accounting, (IFAC.org).
The IFAC has 172 members in 129 countries, unlike the AICPA which has over 375,000 members; however, the IFAC represents over 2.5 million accountants throughout the world. The mission of the IFAC is to develop standards and guidance to accountants and help them implement high quality standards in their own practices. Both the AICPA and IFAC promote cooperation, high quality standards, and implementation of standards so that members can be the best that they can be. They both promote implementation of core programs for ethical behavior and provide missions to uphold the highest quality of the accounting profession. As we move closer and closer to a global set of international accounting standards with IFRS (International Financial Reporting Standards) which would allow accountants to use one set of standards on financial reporting for public companies, we are setting our sights on a global set of ethical standards. Now, that we are participating in international markets, international businesses, and sending jobs and workers throughout the world, there is a call for an international code of ethics that would apply to all of those around the world that participate in international business and trade. A global set of ethics would change the way businesses do their business and adapt to their environment. In recent and past history businesses adapted to the environment they were in, “When in Rome” right? Many people believed that when you went somewhere else that you should adapt to that environment and be tolerant of everything there, now people are starting to believe that that might not be the case and that a global set of ethical guidelines is needed, (George, B). The argument for a global standard is that everyone would follow the same set of rules and there would be less conflict and easier resolution of problems. The argument against is that there are so many different cultures, religions, beliefs, and morals around the world, that getting everyone to agree would be next to impossible. There is an increased need for global ethics because more and more businesses are going global and doing international business, the only problem is figuring out how to implement it. Let’s now take a look at the United Nations Global Compact, which is a completely voluntary program comprised of ten principles that encompass human rights, labor, environment, and corruption. The ten principles included in the compact include:

* Human Rights * Respect and protect internationally proclaimed human rights * Do not abuse human rights * Anti-Corruption * Combat corruption * Combat extortion and bribery * Labor * Uphold the right to collective bargaining * Eliminate forced labor * Abolish child labor * Abolish discrimination of employment * Environment * Support environmental responsibility * Encourage environmentally friendly technology, (UNglobalcompact.org).
The UN Global Compact has over 10,000 corporate businesses as participants and is accepted in 130 countries, which makes it pretty widely accepted. When you think about it, ethical violations generally fall into most of these categories already, with a few exceptions. The point of the global compact is to adopt a system or a framework for businesses to follow. Ethical situations are rarely cut and dry, this system, with a little work could provide an outlet for businessmen and businesswomen to implement an ethical program into their own workplace. The biggest question about the Global Compact is governance and effectiveness, the question being, is there any? I am finding that there isn’t a lot of governance when it comes to the compact, corporate or otherwise. This leads me to believe that it is the main reason why the Global Compact is more widely accepted in developing countries. In truth, businesses would likely adopt a global set of ethical guidelines, why? It would provide a standard for doing business outside of the United States. No longer, would we follow the old saying, “When in Rome.” We could break the myth that we have to conform to and to tolerate unacceptable ethical standards when we do business in other countries and foreign markets. However, we need a form of governance, I am not a big fan of more government regulations or interference by any means; but, this is one area where a little more wouldn’t hurt. So, now we are to the point in the paper where I give my own opinion, most times whether you want it or not. Do I believe some sort of ethical guidelines are needed? Yes, yes I do. Do I believe in my heart that one set of global guidelines would work? No, no I don’t. My number one reason that I believe a global set of guidelines would not work is culture. For example, I live in a small city, Hagerstown, Maryland. I am an independent person who has the freedom, the ability, and the right to get into my car or walk to do just about anything I want within reason. A woman, just like me in India, doesn’t have the ability, or the freedom to just pick up and go out and get something like I do, so she has to beg, lie, or steal, because most likely she can’t go to her government and ask for assistance. She has to steal, cheat, beg, lie, or anything else she can possibly think of to get food for herself and her family. It is the same in business, in our culture, we are ruled by the fact that our government will help us or bail us out if we get into trouble. Other cultures do not have that option, not because they don’t care, but because they don’t have the money. If we set up a global ethical program, we need some form of governance and enforcement of the policies, then with the enforcement and governance, we need punishment. So, if a developing country cannot afford to enforce the policies, do we punish them? How do we employ a policy or a set of guidelines that is all encompassing and fair to all? The second problem I find with a global set of ethical standards also goes towards culture. What might be ethical to me, might not be ethical to the woman in India. I have my faith, guidance, and a strong set of morals that were taught to me by my parents when I was growing up. They instilled in me a moral sense of what was right and what was wrong. I grew up in a loving home, with food on the table every night and a bed to sleep in. The same woman in India might have had to sleep on the street, only be able to eat once a day, and had parents that worked twelve to fourteen hour days. So, how could there be an ethical guide that would fit two such different upbringings? In summary, would a global set of ethical guidelines work? My answer would be maybe. Would a global set of ethical guidelines please 100% of the participants 100% of the time? Absolutely not. Nothing that has ever been done in the history of the world has been accepted by everyone, it’s just the way it is and the way that it will always be. I believe that we as a people need some guidelines on what is acceptable and what is not, but I also think that it needs to be culturally acceptable to all who participate. So, here is what I propose. Throw the idea out there and those countries who would like to participate come together in one location and iron out the details, the governance, AND the punishments. I have found throughout my short twenty-eight years on Earth that when you let the participants be involved in the making of it and they are much more likely to respect and respond to it. We can just make it and try to steamroll it into action, as we have proven many, many times, that doesn’t work. I don’t know what will happen in the future, but we do need a change, and I hope it is a good one.

References
AICPA.org. (2006-2013). Frequently Asked Questions about AICPA
Retrieved April 19, 2013 from, http://www.aicpa.org/About/FAQs.aspx#aicpa_answer6

George, B. (2008). Ethics Must be Global Not Local
Retrieved April 18, 2013 from, http://www.businessweek.com/stories/2008-02-12/ethics-must-be-global-not-localbusinessweek-business-news-stock-market-and-financial-advice

Globalcompact.org. (ND). Ten Principles
Retrieved April 17, 2013 from, http://unglobalcompact.org/AboutTheGC/TheTenPrinciples/index.html

IFAC.org. (2013). History
Retrieved April 19, 2013 from, http://www.ifac.org/about-ifac/organization-overview/history

Melancon, B.C. (2010). The Global Accounting Profession in the United States
International Journal of Disclosure and Governance, November 2010; 7(4): 294-297