How Can CFOs Make Business Ethics a Competitive Advantage?

The rise of corporate transparency measures is bringing business ethics into the spotlight. There are three key areas where organisations can demonstrate the company is built on an ethical framework: Risk management, Internal control and Compliance. It starts with financial controls that are structured, automated, documented and auditable. From there, it builds into clear compliance with measures like ECCTA and Provision 29 (in the UK) or Sapin II (in France), and a culture of integrity across the company. Business ethics can become a competitive advantage because this level of best practice impresses investors, partners, clients, prospects, talent and the team.

Internal Control and Compliance Framework measures can be the foundation for this culture of integrity. Rather than being a cost centre, they can bring the same high standards to corporate entities worldwide. It’s about aligning controls by using technology you can rely on. This starts with the finance team because clean and trustable accountancy equals good governance. So a successful risk assessment can become a transformational moment for a company. 

Here’s three ways CFOs can make business ethics a competitive advantage: 

• Set the tone at the top.

Show how Internal Control and Compliance are part of being a successful organisation. It should be incorporated into strategic goals like risk management. A focus on business ethics can benefit the organisation as a whole, attract new talent, build on partner relations and create investor confidence. 

• Embed ethics into financial systems and workflows.

The process of automating and standardising controls means that the company participates in ethical behaviour in its daily work. The financial systems themselves require and enforce integrity, making it the default, not the exception. CFOs can also strengthen norms by communicating clear expectations for high levels of ethical behaviour and ensuring systems support them.

• Leverage data and analytics to proactively spot red flags.

Move beyond manual audits to adopt a continuous, proactive monitoring approach. Use technology and analytics to detect patterns and raise exceptions, such as unusual expense reports, spikes in vendor payments and non-standard transactions across global subsidiaries. Make integrity a structural part of how financial data is used in everyday decisions.

These three actions shift the work of Internal Control and Compliance from a necessary burden to a dynamic driver of business value and trust.

CFOs can position Internal Control and Compliance as adding value to the company, not just enforcing the rules. The finance team can use integrity as a risk management tool that enhances the organisation’s profile, all of which matters to investors and talent. 

Anti-fraud, pro-transparency measures are increasing. In the UK they apply not just to companies headquartered in the country, but also the large, UK subsidiaries of companies registered elsewhere in the world. The Serious Fraud Office (SFO) is baring its teeth over organisations getting their houses in order, which suggests firms need to show their compliance through culture and actions, not just box-ticking. 

Technology is one way to bring a culture of integrity to the whole organisation. It’s not just about controls, but training and raising of expectations throughout the business. Sixthfin is already ahead of the game. Our technology has been tried and tested on Financial Internal Control and Sapin II in France. Now it is ready for ECCTA and Provision 29 (the so-called “UK SOx”) in the UK. It will enable organisations to meet “by design” the requirements of these new measures. Our technology works with your existing systems to give your financial team full oversight. Not only does it offer improved efficiencies, it also makes Internal Control and Compliance work easier, affirming your organisation’s commitment to transparency and ethics. 

CFOs have a huge opportunity to lead their organisations to a culture of integrity via robust financial processes. It’s time to change the perception of Internal Control and Compliance activities. It’s no longer about rule-taking to avoid penalties. With the right stewardship, organisations can build a framework for transparency and long-term success. CFOs and their finance teams can lead the way to making business ethics a competitive advantage.