IBE issues guidance on new role for internal audit
A new Board Briefing, published by the Institute of Business Ethics, sets out the role of internal audit in advising boards on whether a company is living up to its ethical values.
The financial crisis and a series of scandals at non-financial companies have prompted regulators and investors to focus on culture as a significant risk to corporate health. Boards, too, are increasingly concerned to embed a sound corporate culture to protect and enhance their company’s ability to generate sustainable value.
Checking Culture: a new role for internal audit draws on the experience of those involved at senior level in six companies representing a wide range of sectors and sizes. Audit Committee chairs, heads of internal audit and heads of ethics and compliance recount in their own words how they have approached the challenge of checking culture. It includes interviews with Mike Ashley, Chairman, Board Audit Committee, Barclays Bank, Scott Strachan, Global Head of Internal Audit, Aberdeen Asset Management and Alyson Corrigan, Director of Ethics, Tate & Lyle, among others.
Peter Montagnon, IBE’s associate director and author of the report, said: “Culture and values matter to companies because they help determine how risky they are and how successful they will be in the long term. It therefore follows that boards need to know whether the culture they want is the one they have actually got.
This IBE Board Briefing opens up the debate and enables people to talk about what they are doing and what they have achieved and where the difficulties are, so the business community as a whole can benefit from their experience.”
Philippa Foster Back CBE, IBE’s director commented: “There is still a long way to go before companies and internal auditors take on board the opportunities as well as the risks inherent in the way companies build and embed their ethical culture. This IBE Board Briefing should be of practical help to others, as it shows that much can and is being done.”