Professional Ethics for Business Relations

ecm ono ics

e. a. Tinyakova

Abstract. The article on professional ethics in business is partly review type and classifying different approaches. Classic and non-classic approaches in professional ethics are characterized. The influence of philosophical branch- es on the content of professional ethics is shown. This way of presenting material has been chosen by the author with the aim to emphasize the most prob- lematic and difficult points in contemporary professional ethics, particularly accountants’. Ethical considerations are psychologically grounded in some respects. The main notions of professional ethics are presented with the aim of concretisizing their content. The focuses for building professional ethics have been chosen: interaction of oppositions, social conditions of acceleration, creativity, emphasis of individual realization, respect. The most difficult problem has been pointed out: eternal moral stability and dynamic on-going of our life which demands the decision of a moment. Overwording in description of business relation is marked as a negative trait: all situations in professional ethics can’t be described. The specific traits of accountants’profession are underlined. Further prospects of discussing professional ethics are planned. The conclusions serve the respect of human labour and its quality. Key words: Philosophical ethics, professional ethics, the good, the evil, casuistics, labour quality, discipline, accountant, psychology, moral.

here are two words for labeling emphasizing human will. «Moral» is more «correctness and order» in human straightforward in meaning. The etimo- relations in business: «ethics» (of logical difference between these words Greek origin) and «moral» (of reflects the basic and cardinal problem in TLatin origin). They are partly synonyms, business ethics: how to achieve balance but etimologically «ethics» suits better, between men and economic environment because in ancient Greek «ethos» went requirements; but this dialogue has a ten- from surroundings to men (that is why the dency to show disbalance to human rela- word directed men to adapt themselves to tions, it happens because ethics (with its the world around them). The Latin word abstract notions) becomes more and more «moral» went from men to surroundings, complicated and confused by psychology.

Tvinyako a, Elena Aleksandrovna — PhD, Department of humanities disciplines, Sergiev Posad In- stitute for the Humanities, SPF Moscow Institute of Business and Law. SPF Moscow University Witte. 141300, Moscow region. Sergiev Posad, Moscow Highway 12-A. [[email protected]]

DOI: 10.7256/1339-3057.2013.1.9454 93 economics

Aristotle, the famous Greek philosopher, The problem of professional ethics, from interpreted «ethics’ as practical philosophy». the point of view of casuistics, is to correct He forsaw that ethics would be background- professional mistakes but not to put a per- ed by psychology. Lorenzo Valla, the Italian son in an uncorrectable situation. The wis- philosophy of the 15-th century, stated that dom of professional ethics is to give every- ethics is born by human nature [1], but not body a chance to correct one’s mistake and descends from the heaven as they thought in protect from repeating it. The more wise Antique times. the correction of a professional mistake is, We may point out two different ap- the more is the chance that it will never proaches to ethics, professional ethics in- come again. That is why casuistics seems cluded: 1.classic and 2. non-classic. The more real than classic professional ethics first approach develops from the ancient which rejects any chance of error — every- past and tries to make equal the words thing should always be correct. «ethics» and «wisdom». The classic ap- Nowadays there often appear tension proach gives recommendations to follow between the essence and the obligatory. The the right and best ways in life: the justice more so as social acceleration, stated by con- stands above human relations and people temporary sociology, sharpens the situation: came to the idea that to get justice one we have less time to think over our decisions must suffer, the just result may appear af- than in the 20-th century. And from the point ter human death. The second approach, of view of psychology, lack of time press- «non-classic», is due to philosophy of es psychic and adds to anxiety and worry. post-modernism and psychology, having In ancient antiquity (the 6-th century BC) discovered numerous variants in realiz- Greek philosophers paid a special attention ing one’s charachter. It doesn’t give strict to the use of time [«Appreciate time», — recommendations, but cares mostly that a Hilon; «Everything has its time», — Pit- person should find oneself in a favourable tak; «What is the wisest? — Time because it situation. Pragmatism, utilitarism and psy- guides everything» — Phales]. Thus the root chology urged and helped «non-classic» of motivating business relations has become approach. Here suits the branch of philo- very complicated: it has at least a four-fold sophical ethics — «casuistics’ (from the projection–basic reasons (derived from the Latin word «casus», «case» in English) — content of an economic situation per se); «ethics for an hour». Its recommenda- the atmosphere in the company or working tions may contradict classic ethics, but in group; exterior influence [Thomas Donald- many respects they help to get a profit for son analyses the social contrast between so- an applicant. Casuistics may also be called ciety and business; 2] and the person, focus- «short-term ethics» in comparison with ing the whole situation. Nowadays it is just philosophical ethics that is «long-term». the fourth component that demands most nu- But since it is an ethical branch, casuistics merous considerations and causes the «over- shouldn’t destroy the ethical moral laws, wording» of professional ethics [3] as a sub- for example let the evil take the upper hand ject, and it just complicates the matter. over the good. Casuistics is more life-like Specialists in ethics know the golden sometimes because not a single man has rule of ethics: «Treat other people as you ever been born perfect, everybody makes like to be treated yourself». Philosophy of one’s path in life though mistakes. The the basic ethical rule is more often referred paradoxical tragedy of human psychic is to the Bible, to I. Kant or Confucius. Folk- that one realizes one’s mistakes after hav- lore philosophy of various peoples empha- ing done a certain action. There is a sad sizes the «effect of echo» in human relations. proverb: we begin to cry after we have lost Let’s special consider the recommendations something: the loss makes us recognize the of wisdom in proverbs [4;5]. From the origi- value and need of the thing lost. Such situ- nal roots proverbs are considered to advise ations come often in professional ethics. always that is right and just. The same can

94 DOI: 10.7256/1339-3057.2013.1.9454 E. Tinyakova be said about philosophical aphorisms. As be» is the eternal source of ethics. Here we an example we shall citate the following: may join the motto of ancient Greek medi- «Energy and persistence conquer all things» cine which laid the background of wisdom [Benjamin Franklin], «A friendship founded (by the way more connected with human on business is better than a business found- health than today): «Don’t make harm». To- ed on friendship» [John D. Rockefeller], gether with Hamlet’s question the ancient «Everybody is ambitious. The question is Greek motto will lead the right path in pro- whether he is ambitious to be or ambitious fessional ethics. to do»[Jean Monnet],» The higher the cul- Ethics as a discipline and research has ture is the more labour is estimated [Georg basic notions; rules, norms, principles, Friedrich Wilhelm Roscher], «Our respect to categories, values [6;7], beliefs, religious the general moral rules is just the conception systems. All these notions are aimed at of duty» [Adam Smith]. The difference be- creating objectivity, stability of human re- tween a proverb and an aphorism is that the lations, our considerations, business rela- first one vectors life as a whole and the sec- tions and decisions. Stability, which can’t ond one vectors numerous situations of the be interrupted, is achieved if business re- same kind. lations serve goodwill, but paradox works But we may give situations from life as when the evil takes the upper hand in busi- examples, when we lose happiness while ness relations and evil-doers get an enjoy- following a proverb. For example, there are able life. The famous Russian philosopher many proverbs in various folklores which N. Berdyaev said that the «best suffer more recommend to tell only the truth, to help all than the worst» [8;9]. Of course, his philo- people without doubt. But each of us can sophical path touched Christian philoso- give illustrations when these proverbs may phy, the sufferings of Jesus Christ, who lead us to deadlocks or an unhappy hour. suffered for mankind. But we shouldn’t The philosophical root of this situation is as be too one-sided in considering this huge follows: the conceptions of the good and the problem. Within the frames of human life evil and their following variants are quite it does really happen that the evil wins, clear in human mind, but our life is so dy- this is the tragedy of human existence, but namic, that it destroys the mental borders. in eternity the good is always the winner. Here the philosophical phrase may help: This abstract position, substantially raised «Extremes meet» (or in everyday speech we above human existence, is cardinal for fur- often say: «Contradictions often add each ther content of the article [10;11]. other»). And it is just non-classic ethics, Now let’s consider the guiding notions that has come to help in such situations. We mentioned. «Rules» are worked out to unite have come to the dilemma: in difficult pro- people socially with the goal of rationality fessional situations what should we obey: acceptable for most people to let matters a) the moral truth; or b) the situation. The go on without obstacles. From the point of answer is: one must be very wise to adapt view of high ethics rules may have some the situations to the moral truth. pragmatic decisions which are aimed not at It is necessary to add here a psychologi- the perfectness of man but at convenience cal tint to the considerations: not a single in relations. Rules help to build a whole so- case in professional ethics can’t be under- cial organism and protect from unnecessary stood as static; the situations are always dy- steps. Rules are more professional in content namic in its development, one must catch in comparison with norms. Norms take more the most favorable moment in its on-going time to be formulated and keep the on-going and put it at the basis of ethical decisions. of human life through years; mainly they are Sometimes we must pay more attention to common to different professions. Principles the past, sometimes to the future, but one are developed from norms but they are rather ought to be very responsible in one’s deci- individual in content. We may define prin- sions. Hamlet’s question «To be or not to ciples as an individual approach to combin-

DOI: 10.7256/1339-3057.2013.1.9454 95 economics

ing rules and norms. Though some people mistake if we take a skeptical approach to may share the same principles. These are combining ethical oppositions and setting just principles that make and help conscience them on the same level. The evil is always meet obligations. The German philosopher I. evil, and the good is always good. The dif- Kant [12] developped «the ethics of duty». ference that can’t be denied is: the good is Some thinkers criticized him that he de- constructing happiness and the evil is con- prived people of freedom: in his conception structing sorrow. But there may appear op- a person should always follow the fulfill- ponents, that will say: «Conceptions of hap- ment of demands set to him. But from the piness are also contradictory». As one of the other point of view the German philosopher ways to decide this discussion the possible granted freedom, removing unavoidable and answer will come: «The good tries to keep accidental situations through fulfillment of a the dear from vanishing». duty. If a situation sets a demand, then it is Values and beliefs are sure to help in better to cope with it than to try to ignore and border like, unstable ethical situations. They leave it a persistent unfulfilled component of refer to philosophical ethics. Different pro- activity. The other German philosopher Ar- fessions have values that meet: responsibil- thur Schopenhauer proclaimed: ity, accuracy, industry, patience, profession- «Human will rules the world» (his work al competence, rhythm in activity, liability «Die Welt als Wille und Vorstellung»). It is to contacts (a certain level of sociability). wise to keep to the» golden balance» of these If we remove one profession from another two philosophical positions. But human will in professional ethics, we may lose moral shouldn’t distort goodwill. Here it is wise to traits what so ever. A human being stands at recollect the Italian philosopher Niccolo di the basis of every profession. And the more Bernardo dei Machiavelli: «The goal, set, so as animals are coming nearer and nearer justifies the means applied». The philosophy to human relations, business included. But of this phrase follows two main paths: the this new problem of professional ethics is good and the evil, and with the development just being opened and demands a separate of human activity they stand further and fur- space for consideration. Nowadays profes- ther from each other. sional values are backgrounded by safe and Categories are theoretical notions and sound way of life. Professional ethics is make up an abstract matrix of our profes- becoming deeper and deeper not only psy- sional life [6;7]. The basic categories of chological, but also biological. Professional ethics are «the good», «the evil», duty, eter- difficulties may distract a person from ob- nity, enjoyment, justice, peace, struggle, serving necessary rules of keeping healthy. harmony, anarchy, etc. The categories of Good moral can’t be built on the basis of ethics, professional ethics included, follow destroyed health (here evil skills and hab- the principle of dichotomy; they make a its are meant). Values help every person to system of oppositions. One of the cores of realize his (or her) sociality in full without these oppositions are I. Kant’s antinomies disturbing others if we act within common- [13]. That is why we can make a conclu- ly shared values. But there are also values, sion: human ethics is constant struggle be- thanks to which various professions differ. tween its dichotomies. Combining opposi- These values are connected with the best tions in professional ethics has become the traits of this or that profession. Let’s com- most acute problem nowadays. Contempo- pare the profession of an accountant and rary science has also this kind of problem: an artist. These are opposite professions in contradictory opinions often exist side by content. The creativity of an artist develops side (for example in theoretical physis — overcoming the ordinary rules. But an ac- recognition and denying of reason). Some countant should keep an eye on the obliga- theoreticians of science state that science tory and the ordinary. Here a question may has vanished. But this situation has nothing arise; is the profession of an accountant de- common with scepticism. It will be a great void of creativity? We shall make a mistake

96 DOI: 10.7256/1339-3057.2013.1.9454 E. Tinyakova if we answer «no». In accounting we deal Philosophical ethics, and professional with another type of creativity — «to find ethics as part of it, have ties with religious the best way to fulfil the professional duty» systems. But it is a separate huge problem (this is the universal definition of creativ- to be discussed. The best classical variant ity). Analysis of creativity can be a strong of professional ethics, relating to protestant moral source of professional ethics. Cre- religion, was developed by Max Weber, the ativity is the most emotionally saturated German sociologist [14]. He puts such quali- trait of professional ethics. It is connected ties at the basis of business ethics: duty, in- with such problems of professional ethics: dustry, rational attitude to money. development of initiative, partnership be- Before passing over to regarding ethics tween the leader and other collegues, keep- of an accountant we shall mention the eternal ing traditions and moving forward, adapta- moral dilemmas: tion of new personell, etc. Creativity can ✓✓ relation of aims and means of their ful- help to develop synergetic level (it can be fillment; a separate problem of professional ethics to ✓✓ relation of individual and social interests; be discussed) in business relations, in other ✓✓ choice between short-term profit and words, to reach self-regulation, minimiz- long-term results; ing orders and commands. Sometimes strict ✓✓ relation of material and spiritual values discipline is considered as dictatorship, but while making decisions. strictness may be of different types: it may The aspects of professional ethics in serve the authority of a leader or the clear- horizontal and vertical projections look as ness of business communication. In the sec- follows. In horizontal projection the main ond case it is sure to help creativity. Here problems are connected with interrelation we shall mark a very important line of con- of persons mainly of the same professional sideration about business ethics — business position. The favorable decision of these communication on the level of language use problems makes a fertile soil for profes- (the author hopes to discuss it on the pages sional relations. In vertical projection the of the journal in the future). Drawbacks and main problems are connected with build- defects in language use may turn profes- ing a ladder of relations: the hierarchy of sional ethics upside down. We shall search professional relations should be observed for moral decision, but the root of disorder but the observation should admit initiatives should be found just in imperfect use of lan- from downward to upward and from upward guage. The profession of an accountant is to downward (the leader should adapt the partly protected from this problem because initiatives to individual acceptance by the in this profession a figure or number stand staff and at the same time inspire the staff higher a word very often. to develop their own initiatives; a good will We shall go on with analyzing ethical combines obedience and creativity among notions. Beliefs are closely connected with the staff. The more so as creativity is a very traditions and have a certain amount of spe- popular problem in contemporary profes- cifically national world outlook. Beliefs are sional ethics, and many times it focuses the connected with culture type and may have rest of professional problems. Creativity is mystic or fatal components. They are more connected with realization of an individu- often specifically cultural than values. The ality. We may explain the psychological most wide-spread beliefs in professional eth- need of this situation. Any profession, that ics are beliefs in good luck. It is good when of an accountant as well, is loaded with a such beliefs are play like, but if they take a huge potential of information (we are liv- stiff form or a norm they may do harm to ing in society of information, mainly thanks relations and bring a negative psychologi- to computer technologies), and creativity cal effect, because mystic ideas are stronger gives a certain amount of psychological re- than logical behaviour. laxation: human psychology has a trait to get accustomed to repeated steps and there

DOI: 10.7256/1339-3057.2013.1.9454 97 economics

appears mood of tiredness, monotony. New his main work «Essais»; he researched the ideas bring freshness in relations. dialogue between the law , predominantly Now we shall pass over to professional on the moral level, and the realization of a ethics of an accountant particularly. The man in life. His major conclusions was: it is main professional activity of an accountant impossible to get rid of misdoings and draw- is calculations. The activity demands such backs in life, but human mistakes should cognitive abilities as classifying, summariz- serve perfection and development [16]. ing and interpreting of financial results [15]. M. Montaigne left precept to modern French The profession of an accountant has much philosophers Jacques Lacan (psychoanaly- mechanical in process, great responsibility sis) and Lyotard (postmodernism, concep- in presenting calculations. They often say tion of narrotology) [17;18]. The French phi- that an accountant has a «feel» for figures; losopher criticizes metanarrotology which it means that an accountant should make his claims to unique truth and justice, thus it is conscience psychologically ‘mathematical» connected with power. The author of the ar- that is all mental operations depend on fig- ticle doesn’t mean in the least to crush the ures; figures dominate above words as has logically framed moral matrixes in numerous been stated earlier. Inaccuracies are exclud- books on professional ethics, which some- ed, of course this creates a certain tension in times build the ideal professional space, but the profession of an accountant: justifying unpredictiveness of human psychic should with words is not admitted. Still creativity is be taken into consideration. The second not excluded, but has a specific interpreta- substantial factor is the socio-psychological tion. For example, shortening of mathemati- situation in society. D. Anderson, a contem- cal calculations at the expense of very fast porary American sociologist, builds such oral calculations mainly. But the desire to do consequence: diversity of society through calculations without mistakes and have some tolerance should lead to respect [19]. By re- superior checking causes dependence of ac- spect he does not necessarily mean «accep- countants on mechanical or computer calcu- tance» or «agreement» but « treating people lators. An analytical mind is typical of an ac- as if their integrity were equal to yours». countant, it means that all professional oper- G. Leech regards professional rela- ations are measured by calculating. The vol- tions still finer: tact, generosity, approba- ume of analytical mental work is rather great tion, modesty, agreement, sympathy [20]. in accounting profession: a specialist should R. Audi builds his conception of understand- handle masses of details without losing per- ing professional relations by means of «play spective. This appreciation of accuracy and of words»: «business ethics and ethical busi- a sense of order can lower and sometimes ness» [21], here we find the unity of profes- exhaust the emotional sphere. The answer to sional competence and moral. Really the a professional question is always inevitable: high quality of performing a job often causes we repeat–figures rule the mind. Such pro- adoration, however high competence often fessional situation makes emotional sphere removes borders of the possibilities of human to a certain extent mechanical, but the suc- psychic, overtiredness and exhaustion may cessful end of numerous calculations returns begin to distort character and psychic. This the blocked psychological energy. n conclu- factor, by the way, is very significant for ac- sion, let’s choose the background for abun- countants’ profession. The pressing through dant and learned discussions and research in objectivity of accountants’ calculations can professional ethics: «What is difficult? — To make impossible to observe professional get to know oneself. What is easy? — To rules in relations; derangement, frustration give advice to others». — Phales, the ancient and failure may follow. That is why for the Greek philosopher. Michel de Montaigne, profession of an accountant relaxation has a the famous French humanist and jurist, kept specific moral significance. on to the end of his life making additions to

98 DOI: 10.7256/1339-3057.2013.1.9454 E. Tinyakova

References:

1. Valla, L. 1989. On the true and the false good. Freedom of will. M.: Nauka. 474 s. 2. England, L. 2001.Why discuss international business ethics? Journal «English Teaching Forum» (USA) 2(39):40-46. 3. Jill, P. 2009. A New Zealand Study Ethical Issues and Workplace Problems in Commer- cial Hospitality. 4. Mitin, I.E. Russian proverbs and their English counterparts. M.: Karo, 2009. 5. Collis, H. 101 American English proverbs. Publ. by Passport Books, NTC/ Contempo- rary Publishing Group Inc., 1992. 6. Izza, M. Ethics. In Principles of Taxation FA2012. Study manual. Ed. By ICAEW. Print- ed in the United Kingdom by Polestar Wheatons, 2013. p. 229-249. 7. Izza, M. Ethics,sustainability and corporate responsibility. In Business Strategy. Study manual. Ed. By ICAEW.Printed in the United Kingdom by Polestar Wheatons, 2013. p. 571-603. 8. Motroshilova, N.V. The meaning of creativity. Russian thinkers and philosophy of the West. M.: The Republic, 2006. S. 233-242. 9. Berdyaev, N.A. On ierarahii values. Goals and means. Selected works. Rostov-n/D: «Phoenix», 1997. S. 247-257. 10. Eternity. Philosophical Dictionary Vladimir Solovyov / cost. G.V. Belyaev. Rostov-n/D: «Phoenix», 1997. S. 28-29. 11. Evil. Philosophical Dictionary Vladimir Solovyov / cost. G.V. Belyaev. Rostov- n/D: «Phoenix», 1997. S. 137. 12. Kant. Philosophical Dictionary Vladimir Solovyov / cost. GV Belyaev. Rostov-n/D: «Phoenix», 1997. S. 184-187. 13. Antinomy. Philosophical Dictionary Vladimir Solovyov / cost. G.V. Belyaev. Rostov- n/D: «Phoenix», 1997. S. 180-181. 14. Weber M. The Protestant Ethic and the Spirit of Capitalism. M., 2003. 15. Pshegusova, G.S., Andreeva L.L., Grebennikova N.D., Mlodinskaya N.V. English for economic specialties: a textbook. ed. 20. M.: «Darya, and K», 2013. S. 67-69. 16. Montaigne, M. experiments. M.: AST. Astrel, 2011. 768 s. 17. Lyotard, J.F. La Condition Postmoderne. Paris, 1979. 18. Lyotard, J.F. Des dispositifs pulsionnels. Paris, 1980. 19. Anderson, D. 1999. The keys to a civil Society. Journal «English Teaching Forum» (USA). 4(37). P. 36-48. 20. Leech 2005. Politeness: Is there an English-West Divide? In Journal of Foreign Lan- guages. General Serial. №160. № 6. 21. Audi, R. 2008. Business Ethics and Ethical Business. OZON.RU.

DOI: 10.7256/1339-3057.2013.1.9454 99