The accounting industry plays an important role in the production and implementation of accountability mechanisms surrounding corporate social responsibility practices. Operating as both politicians ...and implementers of knowledge (Gendron, Cooper, & Townley, 2007), the expert activities of accountants are never purely technical. This paper focuses on the mediating role of accounting firms and professional bodies in aligning the socially responsible practices of organizations with the rational morality of the market. I show that the construction of the market as a moral marker of socially responsible action is the result of a major effort of rationalization aimed at justifying the emergence of a social and moral conscience in business, not in the name of subjective feelings or human values, but in the name of an economic and depoliticized logic of profitability. Drawing on the political analysis of Latour (2004) Politics of Nature: How to Bring the Sciences into Democracy and his metaphor of the ‘modern constitution’, I view the economicization of corporate social responsibility as symptomatic of the power imbalance between the world of humans and the world of objects governing the political structure of contemporary society and weakening democratic activity.
Using change theory integrated with Bourdieusian sociology, we re‐theorize a major institutional shift in the field of public accounting. The case we examine involves the consolidation of commercial ...values in the auditing profession. In reinterpreting this shift, we highlight an institutional process structured around a conflict between commercial innovators and guardians of the professional tradition. Our analysis indicates a peculiar kind of institutional work, wherein economic capital is reinforced at the field level while the logic of commercialism is strengthened in accounting firms' structures and practitioners' mindset. From our studying of the field of accountancy, we develop the concept of institutional experimentation in order to offer a view of institutional work as a fragile and unpredictable process. Specifically, the latter is subject to trials and tests by actors involved in a series of more or less connected experiments in trying to extend their professional jurisdiction through institutional innovation, while seeking to consolidate the traditional foundations of their jurisdictional legitimacy through institutional reproduction. Our paper also challenges the notion of organizational archetypes. While a focus on the firms' formal organizational parameters may suggest archetypical stability, the picture is more complex when one takes into account processes of institutional experimentation and the duality of institutional change and stability.
Researchers have examined the socialization of auditors at various stages of their professional development, but they have done little or no work on the continued effects of this socialization after ...auditors leave the firms. Put simply, they have not explored the ways that ex-auditors remember their past. Drawing on the literature in social memory studies and on 37 semi-structured interviews with ex-auditors who used to be employed at large Canadian accounting firms, we perform memory work to examine how ex-auditors transform their audit experience into cultural memory. The narratives of past audit experience elicited during the interviews reveal that ex-auditors develop a complex contemporary representation of this experience. When they solicited their communicative (individual) memories, our participants remembered multiple conflicts between their self-identity and the normative work environment during their time at the firms. However, when they reflected on the impact of their audit experience on their new careers, an alternative and much more collective version of this past emerged. Cultural memories with an elitist and class work dynamic that maintained and justified claims of professional and social superiority began to predominate. We argue that communicative and cultural memory are connected because it is communicative memory that allows cultural memory to take on social forms and exercise cultural domination. Our study makes three important contributions. First, it broadens the socio-temporal perspective of auditing research by highlighting the continued effects of the professional identity of auditors after they change careers. Second, it shows that representations of the past provide ex-auditors with a powerful means to promote their professional interests and structure power relationships within organizations. Third, it introduces the use of reflexive memory work as a rigorous methodological approach in accounting and organizational research.
The present paper investigates financial practitioners’ use and perception of audited financial statements. In-depth interviews, which we conducted with Canadian institutional investors, financial ...analysts and bankers, indicate: (1) a firm tendency to favour the quality of management over the content of financial statements in investment decisions and recommendation processes; and (2) a fundamental scepticism regarding the work of auditors. However, representations of auditor trustworthiness abound in formal texts surrounding the financial analysis domain—as if audited financial statements and the trust they convey towards numbers are indispensable to the work of financial analysts. Based on the work of Roland Barthes, we argue that financial practitioners’ trust in auditors constitutes a mythical representation whose main function is to maintain order and reproduce status quo within the financial system.
Getting Back to Basics Gendron, Yves; Malsch, Bertrand; Tremblay, Marie-Soleil
Innovar : revista de ciencias administrativas y sociales,
10/2021, Letnik:
31, Številka:
82
Journal Article
Recenzirano
Odprti dostop
This paper investigates the dynamics of complexity and expertise in the context of compensation committees (CCs). Drawing on semi-structured interviews, mostly with cc members and consultants, we ...bring to light two axes of subordination that impact the mindset of corporate governance participants, and may ultimately undermine directors’ degree of accountability to shareholders. The first axis involves cc members’ subordination to consultant expertise, which tends to be considered as an indispensable ally in dealing appropriately with the webs of complexity that allegedly characterize executive compensation. Nourished partially by the first axis, the second implies subservience to these webs of complexity, which are widely presumed and naturalized by cc members and the consulting experts they employ. One of our main contributory statements is to question the ascendancy of complexity in the boardroom, casting doubt on one of the key assumptions upon which practices and expertise in contemporary corporate governance institutions are built and promoted. We also question the extent of epistemic dependency in many compensation committees, where much of the knowledge necessary to properly operate the repertoire of practices (deemed necessary to address the problem of executive compensation determination) is not primarily in the hands of cc members, but rather in those of consultants.
este artículo estudia la dinámica de la complejidad y la experiencia en el contexto de los comités de compensación (CC). A partir de entrevistas semiestructuradas, principalmente con miembros y consultores de cc, se revela la existencia de dos ejes de subordinación que impactan la mentalidad de los participantes en instancias de gobierno corporativo y que, en última instancia, podrían llegar a afectar el grado de responsabilidad de los directores ante los accionistas. El primer eje involucra la subordinación de los miembros de un cc ante la experiencia de consultores externos, quienes tienden a ser considerados aliados imprescindibles en el manejo de las redes de complejidad que aparentemente caracterizan la compensación de los ejecutivos. Alimentado en parte por el primer eje, el segundo da cuenta del sometimiento a dichas redes de complejidad, que son ampliamente asumidas y naturalizadas por los miembros de un cc y los consultores que estos contratan. Una de las principales contribuciones de esta investigación tiene que ver con el cuestionamiento al predominio de la complejidad dentro de las juntas directivas, con lo cual se pone en tela de juicio uno de los supuestos clave sobre los que se construyen y promueven las prácticas y la experiencia de las instituciones contemporáneas de gobierno corporativo. También cuestionamos el alcance de la dependencia epistémica en muchos cc, donde gran parte del conocimiento necesario para operar adecuadamente el repertorio de prácticas existentes (consideradas indispensables para establecer la compensación ejecutiva) no está en manos de los miembros del cc de una organización, sino en poder de su equipo de asesores.
o presente trabalho investiga a dinâmica da complexidade e da expertise no contexto dos comitês de remuneração (ccs, na sigla em inglês). A partir de entrevistas semiestruturadas, principalmente com membros e consultores do cc, trazemos à luz dois eixos de subordinação que impactam a mentalidade dos participantes da governança corporativa e podem, em última instância, comprometer o grau de responsabilização dos diretores com os acionistas. O primeiro eixo envolve a subordinação dos membros do cc à expertise de consultores, que tende a ser considerada como uma aliada indispensável para lidar adequadamente com as teias de complexidade que supostamente caracterizam a remuneração executiva. Parcialmente nutrido pelo primeiro eixo, o segundo implica uma subserviência a essas teias de complexidade, que são amplamente presumidas e naturalizadas pelos membros do cc e pelos especialistas em consultoria empregados por eles. Uma de nossas principais contribuições é questionar a ascensão da complexidade na sala de reuniões, levantando dúvidas sobre um dos principais pressupostos sobre o qual as práticas e a expertise em instituições contemporâneas de governança corporativa são construídas e promovidas. Questionamos também a extensão da dependência epistêmica em muitos comitês de remuneração, em que grande parte do conhecimento necessário para operar adequadamente o repertório de práticas (consideradas necessárias para enfrentar o problema da determinação da remuneração executiva) não está principalmente nas mãos dos membros do cc, mas sim nas mãos dos consultores.
Cet article étudie la dynamique de la complexité et de l'expertise dans le contexte des comités de rémunération (CR). À partir d'entretiens semi-directifs, principalement avec des membres des CR et des consultants, nous mettons en lumière deux axes de subordination qui ont un impact sur l'état d'esprit des participants à la gouvernance d'entreprise, et peuvent finalement miner le degré de responsabilité des administrateurs envers les actionnaires. Le premier axe concerne la subordination des membres du CR à l'expertise des consultants, qui tend à être considérée comme un allié indispensable pour faire face de manière appropriée aux réseaux de complexité qui caractériseraient la rémunération des dirigeants. Nourrie en partie par le premier axe, le second implique l'asservissement à ces réseaux de complexité, largement présumés et naturalisés par les membres du CR et les experts conseillers qu'ils emploient. L'un de nos principaux énoncés contributoires est de remettre en question l'emprise de la complexité dans la salle du conseil, en jetant le doute sur l'une des hypothèses clés sur lesquelles les pratiques et l'expertise des institutions contemporaines de gouvernance d'entreprise se construisent et sont promues. Nous remettons également en question l'étendue de la dépendance épistémique dans de nombreux comités de rémunération, où une grande partie des connaissances nécessaires pour exploiter correctement le répertoire de pratiques (jugées nécessaires pour résoudre le problème de la détermination de la rémunération des dirigeants) n'est pas principalement entre les mains des membres du CR, mais plutôt dans celles des consultants.
ABSTRACT
Auditees can play an active role in influencing staff auditors' professional judgment and skepticism. Yet, although it constitutes one of the main threats to auditor independence, very ...little is known about the means and extent of auditees' power during the audit engagement. To address this knowledge gap, our study focuses on a specific category of auditees, namely, auditees who have worked as auditors in large accounting firms. We interviewed 36 of these auditees and triangulated our findings with 11 interviews conducted with auditors. At the theoretical level, we conceptualize auditees' influence over auditors as intentional and active through the notion of “social power.” Overall, our analysis shows that the efficacy of auditees' power during the engagement materializes through the mobilization of two main power resources developed during their time at the firms: (i) expert knowledge of auditing techniques and (ii) social capital. On the one hand, relying on their cognitive authority, auditees' employ three different power strategies to constrain staff auditors' operational independence: stage‐setting, teaching, and questioning. On the other hand, auditees' social capital can support the use of two additional strategies: attracting and monitoring. Our triangulation analysis confirms our findings and suggests that auditors may be aware of the threats to independence that auditee expertise and social capital pose. By focusing on auditees' agentic capabilities—that is, individuals' capabilities to consciously exert influence over the course of events—we reinterpret the pressures exerted by clients on auditors as the product of strategic actions and discuss substantive consequences for independence risk.
RÉSUMÉ
Lorsque le client est un ex‐auditeur : l'expertise et le capital social des audités comme menaces à l'indépendance opérationnelle des auditeurs juniors et seniors
Les audités peuvent intervenir activement dans les missions d'audit en exerçant une influence sur le jugement professionnel et l'esprit critique des auditeurs juniors et seniors (appelés « staff auditors »). Or, bien que cette influence soit l'une des principales menaces à l'indépendance de l'auditeur, on connaît encore très mal les moyens utilisés par les audités pour exercer leur pouvoir durant la mission d'audit et la portée de ce pouvoir. Pour combler cette lacune, les auteurs se penchent sur une catégorie particulière d'audités, soit ceux qui ont exercé les fonctions d'auditeurs dans de grands cabinets comptables. Ils s'entretiennent avec 36 de ces audités et procèdent à la triangulation de leurs constats avec les observations tirées de 11 entrevues réalisées auprès d'auditeurs. Sur le plan théorique, ils conceptualisent l'influence des audités sur les auditeurs comme étant intentionnelle et active à l'aide de la notion de « pouvoir social » Globalement, leur analyse montre que l'efficacité du pouvoir des audités durant la mission se concrétise grâce à la mobilisation de deux principales sources de pouvoir cultivées dans l'exercice de leurs fonctions en cabinet : i) l'expertise des techniques d'audit et ii) le capital social. D'une part, en s'appuyant sur leur autorité cognitive, les audités ont recours à trois différentes stratégies d'exercice de leur pouvoir pour limiter l'indépendance opérationnelle des auditeurs juniors et seniors : la mise en scène, l'enseignement et le questionnement. D'autre part, le capital social des audités peut faciliter l'usage de deux stratégies supplémentaires : l'attraction et la surveillance. L'analyse de triangulation confirme les observations des auteurs et indique que les auditeurs peuvent être conscients des menaces à leur indépendance posées par l'expertise et le capital social des audités. En se concentrant sur les capacités d'agent des audités—c'est‐à‐dire leurs capacités à exercer consciemment une influence sur le cours des événements—les auteurs réinterprètent les pressions exercées par les clients sur les auditeurs comme étant le produit d'actions stratégiques et traitent des répercussions importantes de ces actions sur le risque lié à l'indépendance.
SUMMARY
Drawing on Power’s theorization of the logic of auditability as a multidimensional system (Power 1996), we examine the impact of the COVID-19 pandemic on auditors’ year-end work from January ...to April 2020. Based on 24 semistructured interviews with auditing and accounting professionals located in China, we find that all four dimensions of the logic of auditability were destabilized at once. To restore the conditions of auditability during the pandemic, auditors improvised a deviant system of audit knowledge by rearranging the timeline of audit procedures, altering the substance of audit processes, and designing alternative control mechanisms. As the audit profession continues to evolve and more institutional decomposition (or reconfiguration) of the logic of auditability is expected to occur, this study contributes to our understanding of how auditors improvise in the backstage and produce comfort when they have to operate outside the protective umbrella of legitimate processes during sudden change of circumstances.
In this paper, drawing on autoethnographic material, we document how we have been responding to our school's research incentive policy and its adoption of a new journal ranking process that has ...resulted in the marginalization of most accounting journals. Overall, we contribute to the accounting literature on journal rankings by reflecting on their impact on researchers’ identities. Our personal narratives illustrate how journal rankings, embedded in a research incentive policy, can fragment and politicize junior faculties’ identities, driving them, professionally and intellectually, into contradictory directions and throwing them into academic politics. In terms of sustainability, identity fragmentation and identity politicization are ambivalent processes. They can marginalize junior researchers who do not have the political skills required to play the games of academic politics and discourage those who feel trapped in identity conflicts. On the other hand, identity fragmentation and politicization can also stimulate a deeper form of reflexivity and action. Through increased awareness of self and the political stakes of the field, junior researchers might be able to promote greater diversity and respond actively to the needs of a sustainable accounting research environment.
ABSTRACT
In this study, we examine auditors' claims of professional disempowerment and strategic responses to Canadian Public Accountability Board (CPAB) inspections. Our research is based primarily ...on 27 semistructured interviews with audit partners (23) and managers (4) of large accounting firms. Drawing on key insights from institutional theory, we show that the tensions between inspectors and auditors reflect an intraprofessional tug‐of‐war between two competing but legitimate logics of professionalism. More specifically, our findings indicate that CPAB inspections have given rise to a mechanical logic of audit professionalism that is driven by the efforts of inspectors to promote a generalizable theoretical ideal of auditing that revolves around best practices and attention to technical minutiae. This mechanical logic competes with a clinical logic of audit professionalism that is driven by the efforts of audit partners and managers to promote a more relativistic, applied form of expert knowledge. To manage this dynamic of intra‐institutional complexity, quality experts (QEs) have emerged in firms' organizational structures as ambidextrous third parties—that is, professionals who master both logics and are capable of bridging the institutional divide by influencing the relationships between inspectors and auditors through a variety of brokering strategies. By considering inspectors as insiders rather than outsiders to the profession, we argue that auditors' claims of professional disempowerment should be interpreted carefully and critically. We also suggest that the professional autonomy and judgment of engagement partners and managers has been displaced significantly within firm boundaries into the hands of QEs. Our analysis offers a richer conceptualization of institutional ambidexterity by examining it as a relational process of social influence rather than as a set of individual characteristics.
RÉSUMÉ
Comment les experts en qualité des cabinets d'audit influencent les inspections du CCRC et leurs résultats : une analyse des conflits intraprofessionnels, des influences de tierces parties et des stratégies relationnelles
Dans cette étude, les auteurs examinent les revendications de perte de pouvoir professionnel des auditeurs et leurs réponses stratégiques aux inspections du Conseil canadien sur la reddition de comptes (CCRC). La présente recherche est principalement basée sur 27 entretiens semi‐structurés avec des associés d'audit (23) et des directeurs (4) de grands cabinets comptables. En s'appuyant sur des concepts clés de la théorie institutionnelle, les auteurs montrent que les tensions entre les inspecteurs et les auditeurs reflètent un bras de fer intraprofessionnel entre deux logiques de professionnalisme concurrentes, mais légitimes. Plus précisément, les résultats de l’étude indiquent que les inspections du CCRC sont soutenues par une logique professionnelle mécaniste visant à promouvoir un idéal théorique généralisable de l'audit centré sur la promotion des meilleures pratiques et de l'attention aux détails techniques. Cette logique mécaniste est en concurrence avec un professionnalisme clinique incarné par les associés et les directeurs en audit et centré sur la promotion d'une forme plus relativiste et appliquée de connaissances spécialisées. Pour gérer cette dynamique de complexité intra‐institutionnelle, des experts en qualité (EQ) ont émergé dans les structures organisationnelles des cabinets comme des tierces parties ambidextres — c'est‐à‐dire des professionnels qui maîtrisent les deux logiques et sont capables de combler le fossé institutionnel entre les inspecteurs et les auditeurs par le biais de diverses stratégies relationnelles. En considérant les inspecteurs comme des membres à part entière plutôt que des étrangers à la profession, les auteurs soutiennent que les revendications de perte de pouvoir professionnel des auditeurs doivent être interprétées avec prudence et de manière critique. Ils suggèrent également que l'autonomie professionnelle et le jugement des associés et des directeurs en charge des missions d'audit ont été déplacés de manière significative à l'intérieur des cabinets entre les mains des EQ. La présente analyse offre une conceptualisation plus riche de l'ambidextrie institutionnelle en l'examinant comme un processus relationnel d'influence sociale plutôt que comme un ensemble de caractéristiques individuelles.
► Studies the creation of independent audit regulatory offices. ► Examines how dynamics of power is impacted by the change. ► Shows resistance to logic of arm’s length regulation within offices. ► ...Resistance to arm’s length regulation operates transnationally. ► Private circuit of power aims to preserve tradition of self-regulation.
In the aftermath of Enron and the collapse of Arthur Andersen, new “independent” institutions were created to oversee financial auditing. Based on a modified version of Lukes’ multidimensional model of power, we first investigate how the creation of the Canadian Public Accountability Board (CPAB) has affected the dynamics of power among the main players enlisted in Canada’s regulation of public accounting. Our findings strengthen the view that a “form of allegiance” was, at the time of data collection, developing between CPAB and the largest Canadian accounting firms. Through a second analytical movement, we extend the boundaries of our argument, showing that patterns of resistance against the logic of arm’s length regulation operate in a variety of audit regulatory sites. Our conclusion points, in particular, to the spatial gap – and incidentally the limitations – of any attempt to control and supervise a globalized industry from a national or regional perspective.
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