Ethics and Governance | Report

ETHICS AND
GOVERNANCE

Executive Summary
The individual behaviours as well as the organisational operations are guided by the
ethical principles comprised of legal norms, societal and professional standards. The ethical
theories as studied in the following work that are deontology, utilitarianism, and egoism
guide the management of the entities in addressing the various moral problems and dilemmas.
Different principles and beliefs are the underlying factors in each of the theories to enable
evaluation of conducts. The senior managers of the entity to develop business strategies
efficiently can use the ethical models like that of AAA Ethical Decision Model. The conducts
of the professional accountants are governed by the principles of the “APES 110 Code of
Ethics for Professional Accountants”, which is mandatory in nature and aims to ensure
maintenance of integrity of profession.

Contents
Introduction................................................................................................................................3
Part A: Usage of the Ethical Theories........................................................................................3
Explanation of the Ethical theory of Egoism.........................................................................3
Explanation of the Ethical theory of Utilitarianism...............................................................3
Explanation of the Ethical theory of Deontology..................................................................4
Application of the Ethical theory of Egoism on conduct of Mr Goodrich.............................4
Application of the Ethical theory of Utilitarianism on conduct of Mr Goodrich...................4
Application of the Ethical theory of Utilitarianism on conduct of Arnold............................4
Application of the Ethical theory of Deontology on conduct of Arnold................................5
Part B: AAA Ethical decision-making model............................................................................5
Part C: Usage of the APES 110 Code of Ethics for Professional Accountants.........................6
Conclusion..................................................................................................................................9
References................................................................................................................................10

Introduction
The integrity, success and goodwill of a business is guided by a set of core principles
that influences their decisions and behaviours of those engaged in the establishment of the
policies and strategies, and management of the business activities (Kidwell, Fisher, Braun &
Swanson, 2013). These principles are referred to as the ethical principles and the same have
been established by the virtue of conjunction between the societal values, applicable laws,
ethical theories and models established by the philosophers, and the objectives of the
different stakeholders (Overall, 2016). The aim of the ethical principles is the efficient
addressing of the ethical and moral problems in the business. Thus obtaining a
comprehensive understanding of the same is one of the vital keys to achieve business
objectives and success in the dynamic business environment.
The aims of the following report can be categorised into three sections. Firstly, an
understanding of the ethical theories would be attempted through the study of the theoretical
material and then implement the same to the given business situation. Secondly, the step by
step approach of the AAA Ethical Decision Making would be studied, with implementation
of the same. Lastly, the work would explore the APES 110 Code of Ethics for Professional
Accountants, to conclude on the responsibilities and safeguards available for the professional
accountants in Australian business context.
Part A: Usage of the Ethical Theories
Explanation of the Ethical theory of Egoism
The theory is a mix of descriptive and the normative ethical theory. The chief feature
of the theory is that it is focussed on the promotion of one’s own interests and desires, above
other values (Dion, 2012). Thus, an act to be considered as ethical must result in the
pursuance of the happiness and motives of the one acting. Thus, a reconciliation of the
morality and self-interest is achieved through the theory.
Explanation of the Ethical theory of Utilitarianism
The theory is normative ethical theory as well, the primary focus of which is the
consequences of choosing a course of an act. The distinguishing feature of the ethical theory
is that the interests and happiness of others are the prime consideration in act to be regarded
as ethical or unethical, rather the personal interests (Harrison, 2015). The theory was initially
proposed by philosophers Jeremy Bentham and John Stuart Mill, and is divided into the two