Understanding, questioning and unpacking the social purpose of the profession has been at the heart of AuditFutures’ projects and work streams. We bring forward the concept of purpose, as this aspect of professional work is not often discussed in depth. However, it is a fundamental principle for any profession, as it underpins its social contract and legitimacy and provides direction and meaning to innovation and improvement of services.
Most importantly, understanding the purpose behind an individual’s tasks is essential for their motivation, commitment and quality of work. A vibrant and socially relevant audit profession can inspire, attract and retain responsive and talented people, who are seeking work with meaning and purpose.
Insights from our research suggest that there is plenty of uncertainty (and dispersed understanding) about the social purpose of audit. We believe this ambiguity has had negative implications for the evolving nature of practice, educational and training objectives, and informed debate. Public discourse often alludes to the infamous ‘expectation gap’ without reaching consensus on what the purpose of audit should be. In speaking to students, trainees and professionals, we have seen a general agreement on the need to serve society and act in the ‘public interest’, but little or no clarity on what that might be.
Unpacking and questioning the social purpose of audit was apparent early in the lifetime of AuditFutures and became the basis for many of our workstreams and projects. Our 2014 report Enlightening professions? A vision for audit and a better society was the result of a bold collaboration with the RSA, which suggested the need to rethink the future of professions and articulate a vision for audit.
This project helped to establish a modus operandi for our future work:
It also began our in-depth explorations of matters which help to shape the social and economic purpose of the audit profession, and how this is communicated, understood and upheld. Our work considered matters such as: the social contract for the profession; roles of professional bodies; auditors’ critical capacities and abilities; and the need for agency and motivation in professionals.
Understanding the purpose of individual and group activities and their impact has been shown to motivate individuals to engage and excel. There is a consensus in psychology studies that people need to have a sense of purpose that is embraced by and characterises the whole individual. Individual identity is activated when people get personally involved. This ownership can build intrinsic motivation and decrease the risk of ethical violations.
On the journey to becoming a professional, people should gain not only knowledge, but moral sensitivity and the ability to critically recognise themselves as responsible individuals whose actions impact on society and who contribute toward a specific greater good. To support this, a higher purpose can be embedded and communicated through the ‘ethos’ of the profession (a concept we consider in Principle 2).
To assist in clarifying, articulating, communicating and upholding the purpose of audit, we are sharing some of what we have learnt from AuditFutures’ projects and workstreams. We are also exploring considerations around some underlying aspects, in a series of essays on our website. But before moving on to consider ways in which the audit profession may better serve society, it is helpful to remind ourselves how it already adds value.
Audit and assurance services have evolved to meet practical needs. By building confidence and trust in financial and non-financial information, they have enabled various kinds of trade and related activities, allowing people to reap the benefits of economic development. But when notions of what it means to add value and the expectations and needs of stakeholders are evolving rapidly, so must audit.
Discussions at our Time to Think sessions with young auditors revealed differing perspectives on the purpose of audit today and ambitions for its future. The need to rethink the scope and purpose of audit also emerged as a theme in our engagements with the wider ecosystem of stakeholders, as well as innovation and technical leads from audit firms. The most significant insight in this area is that rethinking and renegotiating of the purpose of audit should drive any policy agenda. This is what should provide legitimacy for the profession and help renew its licence to operate in the public interest.
There are important questions about the social contract between business and society, and the roles and responsibilities of the profession. One essay in the Manifesto resources sections of our website, A profession which serves society (www.AuditFutures.net/manifesto-resources), shares findings from AuditFutures’ engagement and considers how the audit profession might rethink its role in wealth creation and actively lead on the journey towards to a fairer and more successful society.
This will not be simple, straightforward or speedy. Significant change does not happen overnight; neither does an understanding of what this will demand from the audit profession in terms of values, behaviours, capacities of judgement and abilities such as ethical awareness and moral sensitivity – or how these may be developed. Perhaps it is time for the profession to reconsider audit from a philosophical perspective.
The process with which the profession engages in a continuous dialogue about its purpose and role is also important. To demonstrate leadership, ownership and initiative, a modern audit profession should rethink and respond to challenges and opportunities. The commitment for such dialogue with society will enable trust and accountability. It will help the profession to uphold its purpose and be accountable for its pledge to society.
AuditFutures has explored these goals through various initiatives and shares some of what has been learnt within the following essays:
Reviving purpose in teaching ethics [www.AuditFutures.net/manifesto-resources] considers the importance of why and how ethics is taught and shares ideas on aspects of this (such as ways to integrate related content into the curriculum and teach the concept of professionalism).
Purpose and professionalism [www.AuditFutures.net/manifesto-resources] outlines why we need to revive the notion of professionalism and build awareness of this among auditors. These are valuable components in shaping the social and economic purpose of the profession and how this is communicated, developed and sustained – and how members of the profession think about their profession, about themselves and about their purpose.
In 2014 we partnered with the RSA to articulate a vision for audit and a better society. The key messages are indeed inspiring for the profession today.Read more
Key takeaways from the keynote speech delivered by Professor Mariana Mazzucato at the launch of our joint report with the RSARead more