Ethics and Integrity: The Foundation of Public Trust and Professional Excellence

A Chartered Accountant is entrusted with responsibilities that extend far beyond numbers. Businesses rely on audited financial statements to raise capital, governments depend on tax compliance to support public welfare, and investors make informed decisions based on reliable financial information. At the heart of this trust lies the ethical conduct of the professional that certifies, assures, and advises. By upholding the highest standards of ethics, Chartered Accountants reinforce confidence in the financial system and contribute meaningfully to its strength and stability.

The Institute of Chartered Accountants of India (ICAI) has continuously strengthened its ethical framework since publishing its first Code of Ethics in 1963. Effective from April 1, 2026, the 13th Edition of the Code of Ethics marks a significant milestone, reflecting contemporary professional requirements while reinforcing the enduring values that define the Chartered Accountancy profession.

Integrity as the Anchor: The Principles That Never Go Out of Style

For a Chartered Accountant, the most valuable professional asset is not merely technical expertise, it is the trust earned through integrity and ethical conduct. Knowledge and skill build competence, but it is a reputation for trustworthiness that truly defines a professional over a lifetime.

The Code of Ethics reinforces this through five fundamental principles that continue to anchor every Chartered Accountant's conduct:

1. Integrity: being straightforward and honest in all professional and business relationships.
2. Objectivity: exercising professional or business judgement free from bias, conflict of interest, or undue influence, whether from individuals, organisations or technology.
3. Professional Competence and Due Care: attaining and maintaining the knowledge and skill needed to serve clients and employers competently and acting diligently.
4. Confidentiality: respecting the confidentiality of information gained through professional and business relationships.
5. Professional Behaviour: complying with relevant laws and regulations and upholding the standing of the profession.

Integrity has always meant being straightforward and honest, but the revised Code goes a step further by giving honesty its own dedicated place within this principle. It is a small addition with a large implication: a Chartered Accountant shall comply with the principle of honesty, which requires being honest and upright not only in professional dealings but as a citizen, and in one's personal affairs as well. The revised Code also draws on the ideal of Satyameva Jayate (सत्यमेव जयते) i.e., "Truth alone triumphs," a phrase drawn from the Mundaka Upanishad and adopted as the national motto of India, asking every Chartered Accountant to imbibe it as a guiding principle.

The Code of Ethics, 2026

The Code of Ethics, 2026 marks a significant step forward in reinforcing ethical standards within the accountancy profession. Effective from 1 April 2026, the Code has been published in three volumes:

• Volume I comprises the relevant provisions of the Chartered Accountants Act, 1949, the Chartered Accountants Regulations, Council Guidelines, and Council Decisions.
• Volume II converges with the 2024 edition of the IESBA Code of Ethics.
• Volume III incorporates the Ethics Standards for Sustainability Assurance, including the Independence Standards, underscoring the profession's expanding responsibility in the sustainability assurance domain.

Significant Changes in Code of Ethics, 2026

Widening the Scope of Service

The revised Code expands the services Chartered Accountants are recognised to offer. Under Section 2(2)(iv) of the Chartered Accountants Act, 1949, the list of recognised Management Consultancy and Other Services has grown from 28 to 32, now including Forensic Accounting and Investigation, work as a Research Analyst recognised by a regulator, the assessment and evaluation of Social Impact, CSR Impact, and Business Responsibility and Sustainability Reporting, and notably, Artificial Intelligence Consultancy in areas that a Chartered Accountant in practice may render. 'Management and operational audits' have also been expanded to include Information System Audit.

Advertisement, Website, Branding & Visibility Relaxations

Beyond its revised structure, a notable area of reform relates to the Advertisement and Website Guidelines, recognising the increasing role of digital communication in professional practice.

Guidelines on Ethical Issues, 2026

Even as it opens new doors, the revised Code strengthens the safeguards that protect public interest, ensuring that excellence and accountability grow together. The Council General Guidelines, 2008 have been comprehensively revised and renamed the Guidelines on Ethical Issues, 2026. Among the most practical of these is a new chapter addressing the timely payment of audit fees in continuing audit engagements, reinforcing fairness in the professional relationship. A member in practice shall not sign the audit report of a Public Interest Entity (PIE) if the undisputed audit fees for the previous year remain unpaid; for non-PIE, the same principle applies where undisputed fees for two consecutive previous years remains unpaid.

The Code has also refreshed some of its numerical thresholds:

• Indebtedness Limit: From 1 Lakh → 5 Lakh for accepting an audit assignment with the added explanation that "auditor" for this purpose does not include an internal auditor, concurrent auditor, or reporting to management.
• Ceiling on Company Audits: From 30 → 40 for Company Audits excluding One Person Companies and Dormant Companies.

Comparative Summary of Changes (12th Edition vs. 13th Edition)

The Guidelines for Practice in Corporate Form have also been widened to include forensic accounting, administrative services, research analysis, social impact and CSR impact assessment, Business Responsibility and Sustainability Reporting, and artificial intelligence services rendered through a company, keeping this route to practice aligned with the profession's expanding scope of work.

In step with the Government of India's push toward a digital economy, the Council has recommended that members and firms accept audit fees only through digital modes or banking channels—a small procedural step with an outsized benefit: greater transparency in every professional transaction, recorded and traceable by design.

Strengthening Independence Provisions

The independence framework, too, has been strengthened, further anchoring public trust.

• NOCLAR Applicability: The provisions on Responding to Non-Compliance with Laws and Regulations (NOCLAR) now extend to all listed entities and their material subsidiaries[cite: 16, 17].
• Expanded Definition of Public Interest Entities (PIEs): The definition of a Public Interest Entity has been broadened to include entities whose primary function is accepting public deposits.

To further reinforce auditor independence, the revised provisions restrict auditors from providing certain non-audit services to Public Interest Entity audit clients where such services may create a self-review threat. The Code also provides additional guidance on advisory services, clarifying that firms may provide only those services that do not impair their independence.

Taken together with the introduction of Ethics Standards for Sustainability Assurance, converged with the corresponding International Standards issued by the IESBA, these changes show a profession thinking ahead with clarity and purpose.

Collectively, these changes demonstrate that the Revised Code of Ethics, 2026 is not merely an update of existing provisions but a comprehensive modernisation of the ethical framework governing the profession. By balancing technological advancements, professional practices and international developments with the profession's enduring ethical values, the Code of Ethics equips Chartered Accountants to discharge their responsibilities with greater confidence while continuing to uphold the public interest.

The Ethical Standards Board

Code of Ethics is only the first step; its true effectiveness lies in ensuring that its principles are understood, applied and embedded in everyday professional practice. In this endeavour, the Ethical Standards Board (ESB) plays a pivotal role by promoting ethical awareness, providing timely guidance and supporting members in addressing ethical issues with confidence and clarity.

This year carries special significance for the Board. Constituted in 1976, the Ethical Standards Board is celebrating its 50th year of excellence in 2026 - five decades of steadfastly upholding the ethical foundations of the Chartered Accountancy profession. It is a fitting coincidence that this golden jubilee year coincides with the release of the 13th Edition of the Code of Ethics, marking a moment where the Board's long legacy and its forward-looking vision meet.

Since the Revised Code of Ethics came into effect on 1 April 2026, the Board has undertaken several initiatives to facilitate its effective implementation. Notably, the Board had responded to various ethical queries from members reflecting both the practical significance of the revised provisions and the profession's active engagement with ethical issues.

• Website of Ethical Standards Board: To strengthen awareness and provide members with easy access to ethical guidance, the Board has developed a dedicated ethics website (https://ethics.icai.org/) with enhanced features. The portal serves as a comprehensive repository of ethical resources, including guidance on the Code of Ethics, summaries of disciplinary cases and an 'Ethics Quiz' designed to promote awareness, encourage continuous learning and recognise members for their participation.
• "Ethics Echo" An AI assistant Chatbot: To provide members with quick and convenient access to guidance on ethical matters, the Ethical Standards Board has developed and launched "Ethics Echo", an interactive AI chatbot on the Code of Ethics. The chatbot enables members to obtain prompt responses to their queries relating to the Code of Ethics and other ethical issues, offering a simple, accessible and user-friendly platform for ethical guidance.
• Case Laws Referencer: Another significant initiative is the publication of the "Case Laws Referencer (2019-2026) First and Second Schedule to the Chartered Accountants Act, 1949", which compiles decided and published cases of the Board of Discipline and the Disciplinary Committee for the period 2019-2026. The publication serves as a valuable reference for members by providing practical insights into disciplinary cases and their ethical implications.
• Compilation of FAQs on Code of Ethics, 2026: To provide practical guidance on the revised Code of Ethics, the booklet on Compilation of FAQs on Code of Ethics, 2026 has been issued[cite: 17, 18]. The objective of this publication is to provide practical guidance and enhance members' understanding of the revised Code through clear and concise responses to commonly raised ethical issues.
• Conversation series on Dharma of the Profession: Recognising the importance of making ethical principles more relatable and accessible, the Board has also initiated a unique series titled "Dharma of the Profession", presented as conversations between Lord Krishna and Arjuna. The series seeks to simplify ethical concepts and enhance members' understanding of the provisions of the Code of Ethics through practical discussions on ethical dilemmas encountered in professional practice. Ten parts of the series have already been published, which will continue to be published in the future.

The Board has also been organising awareness programmes across the country to make the members aware of the provisions of the Revised Code of Ethics.

Faculty Development Programme: The Board organised a Faculty Development Programme on the Code of Ethics, 2026 in June 2026. The programme featured a series of technical sessions including participant presentations and mock disciplinary proceedings, which provided valuable practical insights into professional and ethical standards.

Collectively, these initiatives demonstrate that ethical standards are most effective when they are understood, discussed and consistently applied in professional practice. Through guidance, education and continuous engagement, the Ethical Standards Board seeks to foster a culture in which ethical conduct becomes an integral part of every professional decision.

Building upon these initiatives, the Ethical Standards Board has articulated a forward-looking vision to further strengthen the Ethics of the profession. The Board proposes to periodically review and update the Code of Ethics in line with international developments and emerging professional requirements while continuing knowledge upgradation initiatives through seminars, webinars, webcasts and specialised programmes on professional ethics. The Board will also commemorate Global Ethics Day through a series of awareness initiatives aimed at reinforcing ethical values and fostering a culture of integrity among members and stakeholders.

Conclusion

The Chartered Accountancy profession has been built on the quiet, consistent and often unrecognised efforts of professionals who chose, day after day, to place accuracy above convenience, truth above comfort and public interest above personal gain. The 13th Edition of the Code of Ethics reflects ICAI's commitment to ensuring that this tradition not only continues but becomes even stronger in the years ahead.

Trust is not bestowed automatically; it is earned through transparent conduct, sound judgement and honest communication. Integrity is not something that is merely spoken about; it is reflected in everyday actions, in the choices made when faced with difficult situations, and in the commitment to do what is right even when it is not the easiest course.

The values of ethics and integrity have always been at the heart of the profession. While the nature of professional work may change and new opportunities may emerge, these values remain constant. Technical knowledge and professional expertise are essential, but it is ethical conduct that sustains the respect and confidence that the profession has earned over generations.

In this journey, the Ethical Standards Board continues to play a significant role by assisting members through its guidance, publications, educational initiatives and outreach programmes. The Board provides members with the clarity and support needed to address ethical matters with confidence.

As the Board completes fifty years, its efforts continue to reinforce a simple but enduring message: when ethics remains central to professional conduct, trust follows naturally, strengthening both the profession and the confidence society places in it.