Ethic in consulting, how is it going?

Ethic in consulting, how is it going?

Ethics and consulting have not always been terms that fit together. The consulting world has a reputation for being a very competitive environment, looking for the best deals and focused on results and performance with intense work hours. Is there a place for ethics in consulting? The model of consulting firms has evolved today following the different trends of the society. More than ever, to attract the best profiles, firms must work on the image they project. The ethics of the company has become an important criterion for candidates seeking a position. CSR projects and company values are essential aspects; the entire culture of the organization is concerned. In order to remain competitive and to continue to attract the best profiles, it is therefore essential for consulting firms to focus on ethics.

Ethics shape individual behavior within consulting firms

The majority of firms have established a code of conduct to implement and disseminate ethical practices. These codes of conduct are massively diffused within the firms. We interviewed a senior member of a big four firm to find out more about the good practices in place within her firm.

To keep her anonymity, we decided to rename her Marie. She explained to us that an annual training is mandatory to follow on the code of conduct. This code covers cases of corruption, anti-money laundering (ID are mandatory prior to missions) and in a general way the appropriate behavior to adapt when dealing with a client. Deloitte and EY are firms that have set up a code of ethics and recurrent training for all employees. Deloitte, for example, requires ethics training for each employee (1). However, these trainings remain global. "These are fairly basic rules that are based on common sense," explains Marie. For example, a gift from a person can only be accepted if the amount is less than 50€, if the client wishes to cheat on his activity, you must report it, etc. These trainings are more about awareness and prevention.

Managing ethical issues internally

The issue of ethics is not only with the client but also in the daily interactions of employees. Consulting firms are known to have a strong promoter spirit. The barrier between professional and personal life is not very marked and new types of management are redefining the boundaries between hierarchies.

"Newcomers have a hard time making this distinction between work and personal life, this familiarity that we have with each other outside of work is often found in interactions at work," explains Marie. "I once observed a situation where an assistant insulted a manager." Interpersonal relationships within the firm itself are often challenged.

To deal with these outbursts, many firms have implemented internal solutions. Deloitte has an internal hotline that allows employees to report all types of incidents (1). "In case of ethical problems with a colleague, we address directly to the partner of our department by bringing up the point, there is to my knowledge no independent entity that deals with these subjects", specifies Marie. Conflicts in the workplace are mostly dealt with on a case-by-case basis.

Moral principles influence the work of the consultant

Ethical principles regulate the activity of consultants. The numerous scandals in the consulting world have prompted firms to take important measures.

How consulting firm deal with conflict of interest? To deal with conflicts of interest, firms are implementing an audit process. Within Marie's firm, preventing conflicts of interest upstream is essential. "Everything is done to easily identify the missions on which you can work and those on which you can't", explains Marie. Each employee must declare the shares they own. It is not possible to work on an assignment in which the employee has a financial interest. This point is rather monitored due to all the scandals. At EY, independence alerts are also sent to each employee when the firm acquires a new client (3).

In Marie's firm, an entire department is dedicated to independence.

"If we find ourselves in a conflict of interest, we must immediately send an email to this department, which will remove us from this mission," adds Marie.

Ethical principles tend to regulate the consulting world. But can we really talk about ethical consulting?

Consulting and Ethics, a question of image?

Despite all the efforts made by the various consulting firms to practice their profession in a more ethical manner, doubt remains as to their real intentions. Thus, consulting firms give more the impression of wanting to polish their image than a real will to change and spread ethical values. At the moment, the firms are aware that they must reflect an ethical image, so as Marie indicated, they are setting up online training courses that must be followed by all their employees, and codes of conduct have been introduced. But all this is more like a marketing protection, a justification to be able to prove and highlight to the public opinion "you see we are ethical".

Unfortunately, the reality is quite different and money often comes before ethics. During our exchange with Marie we asked her the following question: "If your firm ever realized during the mission that one of its biggest clients was doing something unethical but that these actions were not made public, would it be able to stop the collaboration? Marie's answer was clear and instantaneous: "no". Ethics remains above all a story of image for consulting firms rather than real values put forward and strictly respected by the latter. However, the picture is not all black. Some branches of consulting firms have ethics at the center of their activities. This is the case of green taxonomy consulting firms that aim to reduce the CO2 emissions of companies by setting a threshold of emissions beyond which the company will be taxed. As Marie confides to us, "firms are tending to become more ethical" but there is still a long way to go before ethics and consulting become one.

1. Deloitte, responsabilité sociale de l’entreprise: https://www2.deloitte.com/fr/fr/pages/en-savoir-plus/articles/notre-responsabilite-sociale-d-entreprise.html

Article by SCHMITT-CHEVALIER Chloé & COUILLAULT Hugo