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Making Use of the CIPFA TICK Scores: Guidance for Departments

5  Are internal controls supported by a suitable “tone at the top”?

The chief executive, the senior management group and management generally should foster an organisational culture that motivates members of the department to act in line with risk management strategy and policies on internal control set to achieve the department's objectives. The tone and action at the top are critical in this respect.

The “tone at the top,” the culture, and the ethical framework of the department are essential to an effective internal control system. The chief executive and the senior management group alike need to lead by example with respect to good governance, risk management, and internal control. For example, if senior management appears unconcerned with risk management and internal control, then employees down the line will be more inclined to feel that appropriate management of risk through effective controls is not a priority.

While a code of conduct can support and enable the desired types of employee behaviour, the principles in such codes need to be continuously reinforced principles in word and deed, with training programs, model behaviour, and by taking actions in response to violations.

Suggested Response

Leadership that is concerned about the CIPFA TICK survey assessment of this principle need to look to ways they can instil a broader culture of responsibility within an organisation. Governance, risk management, and internal control topics will need to be accorded high priority at regular governing body, management, and employee meetings. Other steps may include more positive recognition of a “hands-on” approach in the operation of controls, effective whistle-blowing procedures, and appropriate and diligent follow-up on control weaknesses or failures.

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