Ernst & Young, bastions of corporate responsibility

There’s been significant debate in the past year about the introduction of ethics classes in public schools in New South Wales. The St James Ethics Centre was tasked with developing and implementing a curriculum, including sourcing volunteers to teach the program.

The St James Ethics Centre has a strong history of developing and assessing ethics. In 2003, it undertook the first Australian Corporate Responsibility Index (CRI), which it has conducted up to and including 2010.

The CRI grades corporate responsibility by assessing five key areas:

*Corporate strategy – the manner in which commitments to responsible businesses are incorporated into the company and their influence on strategy;

*Integration – how the strategy translates to operational responsibility and whether or not corporate responsibility translates to decision making and the overall company culture;

*Management practice – with a view to the key issues of the specific company, this factor assesses the objectives and targets in each of the stated sub-categories, including the communication, implementation and monitoring of relevant policies. The last sub category in the group relates to the workplace and assesses “the environment into which individuals are recruited and developed both professionally and personally, with full entitlement to employment rights.”

 *Performance and impact – reviews the environmental and social impact of corporate policies. Six options from a total of eight must be completed. Among the social options are “Health Safety & Wellbeing, Employee Development, Equality Diversity and Inclusion in the Workplace, Community Investment or a Self-Selected Social Impact.”

*Assurance and Disclosure – assesses the accuracy, relevance and reliability of the data companies provide in the CRI survey, including “their willingness to disclose their submission and results with external stakeholders.”

Between the 2003 and 2007 inclusive, the CRI was supported by Ernst & Young. Their role was validation of submissions by assessing evidence and consistent interpretation of questions. That being the case, my opinion of the CRI is not terribly high, given the extent to which Ernst & Young have gone since 2002 to ignore the racism within its own Canberra office.

Review of various posts previously written by Bakchos detail the process of discrimination directed at the former Commissioner for ACT Revenue. Very early in this process of marginalization, a subordinate (henceforth, the Inquisitor) of the former Commissioner, who was under investigation within his own department, apparently contacted various entities including the ANZ Bank and Ernst & Young with the intent of viewing the former Commissioner’s personnel files. Dubious about the authority of the Inquisitor, the ANZ Bank contacted ACT Treasury and was advised that the Inquistor was acting beyond his authority; ANZ hence, denied the request. Ernst & Young were similarly advised, but despite notification prior to any breach of confidentiality, EY in the person of Tanya Taylor permitted unauthorized access to the former Commissioner’s subordinate. Now that’s what I call corporate responsibility!

The impact of the access to the former Commissioner’s personnel file cannot be understated. It provided a significant avenue via which the Inquisitor was able to manipulate the Commissioner’s records, accuse him of fraud (the very crime for which the Inquisitor himself was being investigated within the Department of ACT Treasury) and have him ousted from his position, bereft of all income, support or recourse.

Then we have the recent comment by “Tom Payne”, the third in a trio that began by suggesting support and sympathy for the Commissioner and disdain for the attitudes within ACT Treasury, but have suddenly altered tone to that of abuse, denigration and racism. It’s as if there’s two Tom Paynes … perhaps. My own jury of one is out mulling this over with its Gemini twin at present as they share a dram. (We Geminis can hold a great argument with ourselves!) Nevertheless, this Tom Payne claims to have worked in the same office as the former Commissioner during his days at Ernst & Young; in fact, he claims to still work at EY, which really calls into question the values of the accounting firm if it is true.

Among the Ernst & Young policies that apply to all staff is a Global Code of Conduct (the Code). In the context of the CRI and the former Commissioner, it makes for satirical reading. The document opens with the company values:

*People who demonstrate integrity respect and teaming;

*People with energy, enthusiasm and the courage to lead;

*People who build relationships based on doing the right thing.

Integrity? Doing the right thing? Can’t say I think much of Ernst & Young’s style of leadership based on their treatment of the former Commissioner.

Ernst & Young’s stated values are underpinned by the Code, consisting of five categories:

1. Working with one another. This includes embracing “… multicultural experience and diversity as strengths of our global organization. As such, we respect one another and strive for an inclusive environment free from discrimination, intimidation and harassment.” Methinks someone forgot to tell some of the staff, let alone enforce this particular value.

2. Working with clients and others. Supposedly, EY rejects “.. unethical or illegal business practices in all circumstances” and avoids “ … working with clients and others whose standards are incompatible with our Global Code of Conduct.” Excuse me EY, but being notified of a fraud investigation being conducted into the very person making enquiries of one of your former employees should have negated any and all access to files held by your company, until otherwise directed otherwise by an accountable authority e.g. the courts.

3. Acting with professional integrity. “We promote a culture of consultation. We address questions of ethics and consult appropriately to help resolve them. We do not hide from or ignore issues.” Just like James Hardie did? I hope you lot won’t take as long to resolve this ethical issue. Especially given the subsequent statement in the Code, “We never destroy or alter documents, or recommend their destruction or alteration, for any illegal or improper reason.” Well, just how did the Inquisitor come by documents devoid of any biometric data that were supposedly submitted by the former Commissioner, especially when apparently none was ever submitted? Oh, hang on, I’m off-target here; that would be falsification of records, something that seems not to appear in the Code and which Bakchos advises EY have never addressed.

4. Maintaining our objectivity and independence. “We employ professional skepticism.” Really? The only skepticism seems to have been shown to the former Commissioner, who on the advice of his lawyers Bradley Allen notified EY that any request for access to any of his files by the Inquisitor was to be denied. EY patently missed the “… personal and professional [conflict] of interest …” between the Inquisitor and their former employee and hence failed to “… take immediate and appropriate steps to resolve or manage any that may arise.”

5. Respect intellectual capital. This is the area that seems to have most let EY down, for they failed to “… take proactive measures to safeguard our documents, computers and other data devices that contain personal or confidential information”. Hence, EY failed to protect the confidential information of the former Commissioner, seemingly breaching both the local law and professional standards they aim to uphold.  This is particularly damming given that the Inquisitor, when queried about the unauthorized use of ACT letterhead by him used to gain access to the former Commissioner’s EY files by Mr Glen Gaskell, the investigating officer from ACT Treasury, stated that EY was aware that he was acting independent of ACT Treasury.

Supposedly, breach of the Code can result in “… disciplinary action, up to and including termination of employment.” But that would require someone being held accountable and in the case of the former Commissioner, EY have apparently preferred to emulate the ostrich. To let one person impugn the name of such a large organization through his actions is inconceivable, be it the Inquisitor or Tom Payne. Obviously Mr Payne doesn’t give two hoots about the Code, EY. At the very minimum, he has compromised the integrity of your company in failing to uphold its core values. He doesn’t care about treating others with the same respect he wishes for himself and his family. This was made clear by his statement, “My family always comes first and especially first in the face of a bumb nigger cunt like you.” I could be wrong, but I don’t think Mr Payne believes in equality regardless of colour, creed or race. I can’t comment specifically on gender, but I’d be willing to make a bet he’s sexist as well.

Ernst & Young, in ignoring the actions of it’s staff, past or present, have breached their own Global Code of Conduct. As James Hardie learned, corporate responsibility goes beyond the tenure of individual employees and directors and transfers to those who may not even have been in positions of authority when the breaches occurred. This in no way lessens my disdain for the current directors. It took over 200 years for this country to admit the wrongs perpetuated upon the Stolen Generations, to apologize. To many of Australia’s Indigenous it has been a hollow apology because it has not been backed by actions … or sometimes, by the wrong actions, such as the Intervention. Nevertheless, part of the apology needs to include corporate responsibility and accountability. Many corporations have grown off the back of the black man in this country, many have ignored his needs, fostered his loss and ground his Dreams to dust and still today it goes on. Corporate responsibility must be more than the platitude produced in a modern globalized world, more than a booklet produced to satisfy the regulators. Are you up to it, Ernst & Young?