Report on
Management Consultancy Sector in Hong Kong

HKCSI Code of Ethics

The Hong Kong Coalition of Service Industries (HKCSI) in conjunction with a group of Hong Kong management consultancies has promulgated a code of ethics that governs members professional conduct. The HKCSI code for management consultants covers essentially the same ground as the “mainstream codes”, such as those from the Association of Management Consulting Firms (ACMF), a North American and European group, and the International Council of Management Consulting Institutes (ICMCI) (See Codes of Conduct Appendix).

There are, however, a number of differences between the HKCSI code and others. Overall, the HKCSI code is rather longer and more detailed than the codes promulgated by associations of professionals or industry associations elsewhere. The HKCSI code tends toward more detail in defining prescribed and proscribed practices than other codes. It has a number of clauses that others do not have and lacks some clauses that others do have.

In some specific areas, such as requiring consultants only to take on jobs they are competent to complete, the HKCSI code is essentially the same as codes found elsewhere. In others areas, (conflict of interest, confidentiality of client information, and in dealing with contractors), the HKCSI code is more detailed and more specific. In addition, there are some areas (such as following laws and regulations, keeping in mind the good of the community, keeping in mind the dignity of others, not approaching staff of other firms, not supplanting other firms from efforts they have undertaken, maintaining tight professional secrecy, guidelines on the use of new techniques and processes, not shifting responsibilities without permission, and not charging too low or too high prices) that are covered in the HKCSI code, but not in most of the other codes we examined.

The extra clauses fell into three basic categories, those which looked beyond the scope of the industry (to the community and the dignity of others), those which attempt to govern the nature of competition in the industry (no poaching of staff or supplanting others), and those that address issues that are narrower than those addressed in other codes (on the development and use of intellectual property).

There also is some mixing in the HKCSI Management Consultants Professional Practice Guidelines of ethical issues and membership issues. The clause on firms needing a self-governing constitution and having the greater part of their work in the provision of consulting services, for example, reads much more like a requirement for membership in an association or professional institute rather than part of a code of professional practice per se.

There are some areas covered by other codes that are not covered in the HKCSI code. Most other codes we have examined require a member to report any member that might not be abiding by the appropriate code. The HKCSI code has no such clause, perhaps because it is not clear to whom any infractions would be reported. Nor does the HKCSI code have a clause that prohibits members from hiring or approaching people from client organisations. It might be necessary to include clauses on these issues if an association or institute of Hong Kong management consultants were to try to obtain recognition from international umbrella organisations for consulting bodies. Otherwise the HKCSI code should pass muster with these organisations.

We see no particular need to change the HKCSI code at the present time. It is a bit more cumbersome than others, but it covers most of the ground that other codes cover and is clear enough. If an association of firms or a professional institute were to develop in Hong Kong, the present code might have to be modified a little to satisfy the requirements of any international bodies the association or institute would wish to join, but the modification would be relatively minor.

There are a few questions that the CSI might consider with respect to the code. One wonders if the term should be “Code of Ethics” or “Code of Professional Conduct”. Some organisations, like the Institute of Management Consultants in the United States, use the word “ethics”, whereas most other codes refer to “professional practice” or “professional conduct”. Using the word “ethics” might create something of a negative impression of the industry. After all, if firms need to sign up that they are ethical in a non-medical sense, it would seem to suggest others are not, although there is no market perception in the first place that this might be the case. Another question is whether there should be an affirmative responsibility for those who have signed onto the code to report others who have transgressed. Follow on questions are to whom and what would the result be.

We surveyed management consultancies in Hong Kong about the uses of a code of practice. Hong Kong headquartered firms are far more convinced that such a code is useful than their non-Hong Kong headquartered counterparts. The latter indicate that they see little actual benefit in the existence of such a code in terms of the reputation of their firms. Hong Kong headquartered firms indicate that such a code is a good way to improve the professionalism and image of the management consulting profession. Presumably this means they would be positively disposed to sign onto such a code, while their counterparts in non-Hong Kong headquartered firms would not be.

A well publicised voluntary code of practice for management consultancy in Hong Kong by itself:

1= strongly disagree, 2 = disagree, 3 = neutral, 4 = agree, 5 = strongly agree

From the responses, it appears that relatively few management consultants in Hong Kong are aware of the existence of the HKCSI code. There were far fewer responses to this particular item than to the other questions in the table (60 versus 89 to 91), indicating that many did not know if a code existed or not and most that answered got it wrong.

Neither group, in fact, thinks that a well publicised voluntary code exists. Obviously, given the prior items, the wording of this particular item is necessarily ambiguous. So it could be that those answering the question know of the code of practice, but do not think it well publicised. If it is to be useful in promoting greater professionalism in the profession, the code will need to be much more widely publicised, and adopted. It would be reasonable to assume that if many consultancies here do not know of a code directly relating to their own business, there is little likelihood users/non users will know much about it either.

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