The impact of business ethics on stress, anxiety and depression and the success of auditors

• Date: 14 September 2023
• Pages: 412-435
• DOI: https://doi.org/10.1108/IJOES-07-2022-0150
• Published date: 14 September 2023
• Subject Matter: Economics,Social economics
• Author: Saif Mahdi Muslim Al-Ameedee,Mahdi Moradi,Mahdi Salehi

The impact of business ethics on

stress, anxiety and depression

and the success of auditors

Saif Mahdi Muslim Al-Ameedee,Mahdi Moradi and Mahdi Salehi

Department of Economics and Administrative Sciences,

Ferdowsi University of Mashhad, Mashhad, Iran

Abstract

Purpose –Ethicalconcerns in the f‌ield of trade and business and research efforts in the area of management

and implementationof ethical standards in the organizational chainin the current situation, mainly due to the

impact on the performanceand procedures of organizations, and, f‌inally, the effect on the views and attitudes

of stakeholders and users of corporate information have become critical. Therefore, this study aims to

investigate theimpact of business ethics on stress, anxiety and depression and the successof auditors in Iran

and Iraq.

Design/methodology/approach –The study’s statistical population includes all partners, managers

and auditors working in auditing f‌irms. Threehundred sixty-f‌ive questionnaires were completed by Iranian

respondents and 250 questionnaires by Iraqi respondents in 2021. Also, the analysis of variance and

regressionof ordinary least squares have been used fordata analysis and testing of hypotheses.

Findings –The research results show a negative and signif‌icant relationship between the results of

business ethics and stress, anxiety and depression of auditors in Iran and Iraq and a positive relationship

between businessethics and auditors’success in Iran and Iraq.

Originality/value –As the current research was conducted in emerging f‌inancial markets such as Iran

and Iraq, which are highly competitive,along with special economic conditions, and as the occupation of the

ISIS terrorist group, the civil wars in Iraq, the world’s severeeconomic sanctions against Iran and following

the global crisis of COVID-19,both countries have had special conditions. Therefore, the current researchcan

bring helpfulinformation to the readers and help everyone develop science and knowledgein this f‌ield.

Keywords Business ethics, Stress, Anxiety and depression, Success

Paper type Research paper

1. Introduction

The audit profession is in a position that is strongly inf‌luenced by elements such as trust,

conf‌idence and crediting responsibilities. Therefore, giving importance to moral judgments

in this profession will be very obvious. Because regardless of ethical issues and behaviors,

the position and dignity of this profession will slip; therefore, the most crucial main task of

this profession is the validationof f‌inancial reports (Haeridistia and Fadjarenie, 2019). Also,

according to the agency theory, the auditor is present as a shareholder’s representative in

business units to minimize the conf‌lict of interest between the manager and the owners, so

the audit process mustbe of high quality so that the users can make their decisionsbased on

the resulting report (Jensen and Meckling, 1976).It is clear that when the audit is not of the

required quality, people’s expectations of the auditor’s performance will increase, so it is

essential to know the factors affecting the quality of the audit, which makes the auditors

successful.

The auditor, the audit team and the responsible partner obtain audit evidence from

customer management records,reports and other areas that provide a basis for determining

IJOES

40,2

412

Received4 July 2022

Revised21 November 2022

3 April2023

Accepted26 April 2023

InternationalJournal of Ethics and

Systems

Vol.40 No. 2, 2024

pp. 412-435

© Emerald Publishing Limited

2514-9369

DOI 10.1108/IJOES-07-2022-0150

The current issue and full text archive of this journal is available on Emerald Insight at:

https://www.emerald.com/insight/2514-9369.htm

audit results (Kleinman et al., 2020). The auditor’s interaction with the client or the audited

company and trusting themis one of the basic strategies for gathering appropriate evidence

(PCAOB, 2017). Trust has always been important but it has become even more critical in

today’s complex and changing businessenvironment. Also, the development of information

and communication technology and how businesses are organized have changed the

performance of individuals. In this context, it is diff‌icult to maintain trust and conf‌idence

(Barlaup et al., 2009) because the behaviors of complex people and the detection of immoral

behaviors have also become more complex. Kleinman et al. (2020) argue that ethical

philosophies are behavioral principles that usually inf‌luence decision-making; hence,

auditors are expected to express different behaviors and attitudes in the face of the

environmental conditions of companies and the ethical framework because the auditor’s

decisions and audit results also depend on their feelings, beliefs or knowledge and ethical

and ideological factors that the auditor possesses, which may cause the auditor to fail to

identify signs of fraud (Murphy and Dacin,2011;Trompeter et al.,2013). Also, ethical issues

in the management and scandals of business units in the past few years, which are caused

by their unethical behavior, have never been far from the news headlinesaround the world,

which have a contrarious impactin the short term (Conway and Kotera, 2020) and long term

(Crane and Matten, 2016).

In such a situation, stress, anxiety and even depression increase people. Stress is a

natural and acceptable physicalresponse to a change, demand or threatening situation. The

body’s response to a stressful stimulus can involve a person’s physical, mental and

emotional components (Salehi et al.,2022). Anxiety is normal, like stress; people experience

it in some situations. This mental feelingbrings fear, worry and nervousness. Your anxiety

may arise before a test or an activity and sometimesit may show itself after the event. This

state is somewhat normal,but if it gets out of control, it will have negative effects on people’s

lives (Salehi et al.,2022). But depression is a common but serious disorder in today’ssociety.

This disorder leads to the disruption of a person’snormal life and creates negative feelings

such as sadness, anxiety, despair and anger in a person. Depression affects one’s thoughts,

feelings and actions and disrupts people’s personal and professional lives (Rogol, 2020). In

the case of auditors, if depression increases, it leads to a lack of focus on the audit process

and a decrease in audit quality. Allthese things will affect the auditors’view and attitude of

the company under considerationand the amount of risk they bear. This increase in risk is

one reason that increases stress and anxiety in business units (Vaziri et al., 2020). For

example, Felo (2011) states that managers will make more managerial mistakesif the board

of directors does not monitor the managers suff‌iciently. In addition, Anantharaman et al.

(2016) showed auditors have been facing higher risks of lawsuits recently because the

amount of problems and unethicalbehavior in companies have increased. By examining the

subject literature in the f‌ield of ethics,stress, anxiety, depression and success of auditors,we

found that the study that has been done so far in this f‌ield mainly includes ethics and

depression (Honor et al., 2016;Rogol, 2020); ethical challenges in treating anxiety (Marks

et al.,2021); ethical issues and treatment of anxiety (Altis et al., 2015); and the effect of

professional ethics, independence and experience of the auditor on auditquality (Haeridistia

and Fadjarenie, 2019).

There is no similar research carried out on the impact of ethics on stress, depression,

anxiety and success of auditors in two developing countries such as Iran and Iraq, which

have their own political-economic conditions (for example, the occupation of Iraq by the

terrorist group ISIS and civil wars in recent years) (Ali Ahmedet al.,2019) and Iran’s severe

economic sanctions by America and Europe. Therefore, the present research seeks to solve

the research gap and contribute to this f‌ield’s development and science of knowledge by

Business

ethics

413