Out of the box: use your influence

How can I help my team/function/organisation to be more sustainable?

A: Little steps, big steps, giant leaps – they all make a difference. Participants at COP26 are discussing the high-level issues, but whatever agreements they reach will take time to filter down to corporate and personal level in the form of official targets and regulations.

However, we already know the direction of travel, so there’s no point in delaying setting off just because we don’t yet know our exact destination. Big changes are needed and they need to start now. Some of the largest ones won’t be possible until organisations pave the way with the smaller things – so get started.

We often talk about internal audit’s unique holistic view of the business. This also gives it unique access to multiple departments, global locations, managers and sites. Internal auditors talk to people across the organisation and see what happens on the ground as well as scanning for potential and increasing risks originating outside the walls.

This makes internal auditors real trusted advisers. Every audit and every conversation can be an opportunity to consider sustainability and ask: Could this be done better, with less waste or more bio-diversity? Could we save energy, cut emissions or reduce water consumption? Could the cost of investing in more sustainable technology be offset by reduced risk, lower operating costs or positive customer relations? What can we gain by doing something now, rather than waiting till we are forced to do it by the government or competitive pressure? What are we planning to do about TCFD reporting – is internal audit planning to be involved in providing assurance over the accuracy, completeness and timeliness of the reporting?

When it comes to influencing, the opportunities from change may make a stronger case than the risks. Falling behind more innovative competitors is a business risk that can be hard to quantify – until it’s already happened. And failing to be innovative (either as an internal audit team, or as a business) can cause long-term reputational damage. Forging new relationships with potential allies or collaborators may not give a tangible return immediately, but could put your organisation in a far stronger position if you need to branch into a new business sector or source more sustainable energy or products in future.

All internal audit departments need to be looking beyond their own walls to assess macro risks, and climate change is more macro than most. The proverbial butterfly fluttering its wings in China or South America may already be sending drought, heatwaves, flooding and other natural disasters in your direction – not to mention all the consequent economic, operational and supply chain issues.

No internal audit team can track all the potential risks from this global phenomenon, but all can do what they’re best at; asking questions, fulfilling our trusted adviser role, observing real actions, planning scenarios and identifying data and being assurance providers. They need to tell management and the audit committee what’s really going on, highlight problems that need solutions and, sometimes, suggest solutions for problems management may not yet realise exist.

If every member of every internal audit team used every audit and every piece of assurance work and every conversation to ask “Is this sustainable?” and “How could it be more sustainable?” what results could they achieve? Whether it leads to multiple small steps or a few big leaps, they will at least be going in the right direction. 

This article was published in November 2021.

Bias and barriers

Over the past few years, we have all become more aware of the ways in which our brains are inherently biased and the effects that this bias can have on our working lives – in particular, in the areas of diversity and inclusion, culture and recruitment. You can now be trained to recognise bias and to think about how to implement processes to reduce it.

Fewer people, however, focus on the effect of bias on creativity. Thought habits and the stultifying effects of a dominant accepted wisdom are common in all professions and workplaces – and internal audit is not immune. Internal auditors are told to exercise professional scepticism, but this is far easier to do when you are viewing another person’s working practices than when you consider your own, and your close colleagues’, thoughts.

Professional training teaches you how to think like an internal auditor. But how do you spot when this becomes a problem, rather than a solution? As a society, we applaud the idea of people who think freely and off the accepted tracks, but generally sideline them as, at best, amusingly provocative, and, at worst, dangerous.

When someone comes up with a genuinely counter-cultural idea, we try to pigeonhole it – is it left or right wing, repressive or progressive? The answer often tells you more about the person listening than it does about the idea itself.

It is risky asking people to be creative. No one wants to throw good practices out with bad on an ideological whim. Many whacky ideas are just whacky. There is safety and sense in much received wisdom. If you want to be more creative yourself, and inspire more imagination from others around you, you need to create a space where these ideas can be discussed and biases recognised alongside well-grounded reservations or caveats.

However, you must also convince people that there is a chance their ideas will be acted upon. There must be an incentive to encourage people to put their thoughts out for general criticism.

Many people have got to their current position by being good at fitting in, doing the “right” thing and behaving the way their parents, teachers and employers tell them to. If you ask them to think differently you need to listen to their thoughts – and you need to convince them that their reputations won’t suffer.

Furthermore, the ones who shout loudest when encouraged to do so are not necessarily the ones with the best ideas. Once you have created space and opportunities to express ideas, you need to help people to come up with productive ideas that are genuinely useful and mechanisms to sort the wheat from the chaff – it may be useful to refer to our technical guidance on psychological safety.

Seek help

One crucial element of productive creativity is information. Creative ideas often involve asking people to do things differently or with unfamiliar tools.  This is a barrier. It’s easier to do lots of things that you are familiar with and where you clearly understand your role than to enter new territory. Admitting that you don’t fully understand the details is tough and lack of comprehension tends to increase suspicion – is the information correct and does someone have an agenda that you are unaware of?

This is particularly true when it comes to technology, which is surrounded by technical jargon and where there are a host of providers competing to sell you something when what you really want is simple, neutral advice.

One solution could be to attend a course or a session at one of the Chartered IIA’s conferences, forums or working groups (for example, the Data Analytics Working Group) to help you explore the basics or more advanced ideas in a safe, supportive setting. It could also introduce you to people who can talk through options and share experiences with no further agenda.

Another tactic is to test the information you have by asking someone to play the child in the room and question everything the team does and is planning to do: “Why do we do it this way?” “Why do you say that?” “Why is this important?” If you can’t find an adequate answer, you could try brainstorming for alternatives.

Foresight and insight

To think creatively and productively, you need to stay up to date with global events and use a wide range of sources. Some may not seem to be directly relevant to your business, but the geopolitical tensions and volatile risks we are seeing at the moment can mean that things change fast. Foresight saves time in the long run.

There are limits to what any organisation can do to prevent an emerging risk escalating into a crisis, but thinking creatively about a wide range of “what ifs” could at least prevent people from panicking and ensure that you have responses in place. A crisis involving an energy black-out or a collapsed supply chain may need an instant response when it is too late to think about the options.

Helping other people in your team and organisation also to read widely and look further afield for inspiration isn’t easy when everyone is busy. However, many eyes are better than a single pair and many imaginations are likely to spot more potential threats or opportunities.

One solution is to provide people with relevant links or documents (and time to read them), but you can’t assume they have thought deeply about these. It’s therefore important to find ways to encourage others to engage and think – for example, by allocating documents to specific people and asking them to present their thoughts, or by asking people to become “experts” in particular regions or business areas and bring this knowledge to meetings or brainstorming sessions. Rotating the information sources you send to different members of the team can also help to broaden perspectives.

In the right conditions, most people can be creative and imaginative. “Teaching” creativity should be less important than removing the barriers to it. If you find ways to stimulate curiosity, access a broader range of information and, vitally, share ideas constructively, you may be surprised by the results. And then please share your successes with the rest of us. 

This article was published in January 2023.