Capability unlocked: Ethical judgement and integrity

Accounting and finance professionals now operate in an environment defined by accelerated technological change, rising scrutiny, regulatory complexity and shifting workforce expectations. 

Technical expertise remains essential, but it is no longer sufficient on its own.

This six-part series of articles shines a spotlight on the critical capabilities professionals must unlock to remain relevant, trusted and future-ready. 

Unlock ethical judgement and integrity

Accounting is rarely black and white, but current trends are making the grey areas even harder to navigate. As rising regulatory scrutiny, environmental, social and governance (ESG) reporting demands and a growing reliance on artificial intelligence create uncertain territory, ethical judgement and professional integrity are becoming defining capabilities — not just compliance requirements.

Why are ethical judgement and integrity important for the future?

While technical standards work to ensure the consistency, comparability and reliability of financial information, they do not always provide clear answers to ethical quandaries. Ethical judgement ensures accountants apply principles like honesty, fairness and transparency, while professional integrity shows a commitment to upholding those principles consistently.

Pauline Ho FCPA, a professor in the faculty of business at Curtin University Malaysia, says ethics is evolving from a compliance exercise into a judgement-based discipline, requiring professionals to steer through ambiguity and competing pressures.

“In a complex, technology-driven environment, these practices help ensure that professional responsibility remains clear,” she says. “While tools and regulations evolve, the expectation to act with integrity, fairness and accountability remains constant.”

What do ethical judgement and integrity skills look like in practice? 

Accountants apply ethical judgement to everyday decisions — from questioning data integrity, to challenging financial assumptions or flagging potential conflicts of interest. When mistakes are uncovered, do professionals correct them promptly or downplay their impact? If a key client insists on a stretched reading of the rules, do they push back or yield under pressure?

While ethical dilemmas can arise in various forms, factors like rising regulatory scrutiny are creating higher expectations around ethical judgement and professional integrity.

Markets across the Asia-Pacific region are placing growing emphasis on transparency, governance and audit quality. In Indonesia, for example, the first national Sustainability Disclosure Standards will come into effect from 1 January 2027, marking a significant milestone in the country’s transition towards transparent sustainability reporting.

 

"They are core principles and should be consistently reinforced, not only within firms but across the profession. Regulation may tighten expectations, but it does not define them. Ethical behaviour should already be the baseline."

 

In Singapore, the Corporate and Accounting Laws (Amendment) Act 2025, phased in from May this year, represents a significant overhaul to Singapore’s corporate governance framework and promotes greater transparency in the audit profession.

Meanwhile, Australia’s corporate watchdog the Australian Securities and Investments Commission recently increased targeted audit file reviews with the aim of lifting audit quality and improving financial reporting compliance. 

Shariq Barmaky FCPA, country managing partner at Deloitte Singapore, says that increased regulatory scrutiny is appropriate in complex environments. However, he notes that ethical judgement and professional integrity should not be reactive to regulation.

“They are core principles and should be consistently reinforced, not only within firms but across the profession,” Shariq says. “Regulation may tighten expectations, but it does not define them. Ethical behaviour should already be the baseline.” 

ESG reporting demands are also creating nuanced ethical questions for accountants to navigate. For example, estimating Scope 3 emissions or social impact metrics can involve significant judgement, and there is growing stakeholder pressure to improve sustainability scorecards.

“With ESG reporting, the challenge lies in accurately reflecting reality,” Shariq says. “Issues arise when information is presented selectively, whether through inconsistency, omission or outright greenwashing. 

“While evolving standards and expectations create complexity, the underlying requirement is still to act with integrity.”

The importance of ethical judgement in AI use and outputs

As automation, artificial intelligence (AI) and data-driven decision-making reshape accounting and business, data governance is a growing consideration. While accountants must meet legal and professional obligations around record-keeping, reporting standards and data protection requirements, ethical judgement and professional integrity also help to manage risks.

Ho notes that AI outputs are not always explainable. This creates a “black box” problem if accountants rely on outputs they do not fully understand.

 

"In a complex, technology-driven environment, these practices help ensure that professional responsibility remains clear. While tools and regulations evolve, the expectation to act with integrity, fairness and accountability remains constant."

 

“In practice, AI can generate complex reports quickly, but underlying data may be incomplete,” she says. “Assumptions may be flawed and outputs may not fit the specific business context. Accepting outputs at face value risks overlooking errors and shifting responsibility away from where it belongs.”

Shariq describes AI as a powerful tool for accountants but notes that ethical judgement must be applied to any use. “Using AI as a tool is entirely appropriate for accountants, but where content is AI-generated, it must be clearly acknowledged.”  

What can happen if this skill is lacking?

Failing to develop ethical judgement and professional integrity carries significant organisational risks, including reputational damage, regulatory penalties and damaging stakeholder confidence. At an individual level, it can undermine career progression and credibility.

How can you build ethical judgement and integrity skills?

Adhering to the five fundamental principles of ethics outlined in APES 110: Code of Ethics for Professional Accountants — integrity, objectivity, professional competence and due care, confidentiality and professional behaviour — can help guide ethical decisions. 

Ho notes that formal frameworks also play a critical role.

“Applying the reasonable and informed third-party test provides a structured way to evaluate decisions,” she says. “It requires you to consider whether an objective, knowledgeable outsider would view your judgement or action as appropriate in the circumstances.”

For early-career accountants, Shariq also suggests seeking guidance.

“Consult experienced colleagues, and do not rush decisions due to deadlines or external pressure,” he says. “If needed, ask for more time to reach a considered conclusion.

“Not every decision will be straightforward. When faced with close calls, apply reasonable judgement based on the facts and circumstances. If an error occurs, address it, learn from it and move forward. Continuous learning is part of professional growth.”

Shariq adds that as AI becomes more embedded across the profession, ethical judgement will increasingly intersect with technology. Accountants who can combine integrity with digital awareness will be best positioned to lead with trust in an evolving business landscape.

“Human oversight remains essential,” he says. “Professionals must verify outputs, ensure accuracy and maintain transparency about how work is produced. Technology may change how work is done, but it does not change what it means to do the right thing.”

Capability-building tip

Pauline Ho FCPA, a professor in the faculty of business at Curtin University Malaysia, shares some helpful tips on building ethical judgement and professional integrity.

1. Pause regularly to evaluate decisions and question assumptions.
2. Consider the broader impact of decisions in technology-driven environments.
3. Assess outcomes from the perspective of others.
4. Ask: Would this decision feel fair, transparent and trustworthy if you were on the receiving end?