Well, at first glance, very little. Elections are, however, complex events and have a number of lessons to be drawn from them. Take, for example, the post-election arguments about the fairness of the system. In the UK we use the first past the post system. This means that the UK is divided into roughly equal geographic portions (constituencies) containing a similar number of voters, and that at each election, the candidate from the party with the most votes in each constituency wins. This means a margin can be as little as one vote. The fewest I understand was Glenda Jackson in London for Labour (54 votes). For the system’s detractors this is manifestly unfair. It means that many votes are wasted (i.e. voting for those not likely to win the election in a particular constituency); parties that don’t have geographically concentrated support are unlikely to win; and most challenging, that the system magnifies support for big parties creating the increased likelihood of stronger government.
The lesson for internal audit here is that I see the electoral system as being a bit like audit reports. Any electoral system is attempting to simplify the complex will of the electorate. Just as political parties do. They attempt to boil down a complex set of issues, challenges and choices, into a single vote for a single party. If I’m honest I could have made an argument to myself to vote for at least three of the main UK political parties.
Also electoral systems and resulting electoral campaigns promote two dimensional arguments, analysis and discourse. We as humans like to know the right from the wrong and innately struggle with the idea that there is a range of choices. We also like to personify difference and different opinions and give them meaning and social currency. So I don’t agree with politician X, or I would never agree or vote with politician Y. I have found this with internal audit. Internal audit is wrong. We are right. This project must continue because it is right. We as humans (internal auditors included) find those with alternative views difficult and challenging. This means it is difficult for us to really focus on what is going on. To consider the grey, to consider the nuanced and difficult choices we face in our professional and personal lives. Internal audit is at the organisational nexus of this.
Any electoral system simplifies reality. So the big criticism of the UK system is that it does this too much. How can 4.1m UKIP (a UK political party) votes result in 1 seat in the house of commons, and yet 1.5m Scottish National Party votes result in 54 seats? Yet this is to miss the point about how the system was designed. It was designed for a two or three party system. It was designed to provide a strong government. The UK system is adversarial, not collaborative and coalition based like the European systems. It requires parties to establish a broad base of support across a significant geographic swathe of the country and locks out small and marginal parties. This to me seems no bad thing. It also misses the point that coalition politics in the UK is intra-party. That is to say that coalition politics is live and well in the UK, it just exists intra party. The major political parties, Liberal (well until last week), Conservative and Labour are all coalitions themselves. They work to simplify choices, messages and proposals into their manifestos and campaigns, to make the electoral system itself do less work. Most European coalition systems take weeks or months to form stable government. The UK system does this ‘pre storming’ so that, post election, a government can get on with it.
So what does this tell me about internal audit? Well internal audit nomenclature is like the electoral system. It should provide the top management structures and the audit committee with a clear and unambiguous readout of the results of audit. Yet it should be understood as a simplification of reality and those using the top-level messages should understand this.
Second, internal audit leadership is much like being a politician. You share the analysis with your publics and point of view and are just as likely to be personified as either ‘good’ ‘bad’ or something in-between. The message is personalised in the CAE. This is not necessarily right or fair, but it is true.
Third leading an internal audit team is like being the leader of a political party. It is to be head of a coalition. It is to make a set of messaging and delivery choices following strong internal debate and discussion. It is to head up a group of ambitious, bright, challenging and people with the need to both listen and lead in equal measure.
The final lesson from politics I want to draw is that colours matter. We as a profession use colour in our reports to indicate concerns, messages, focus etc. Just as colour and image matter in politics, they matter in internal audit. So in the wake of the euphoria or depression following the UK general election result, note that the UK has accepted the result, win or lose. Whatever we think about politics in the UK, we have had a smooth transition of power. This requires some maturity. Are your client organisations mature enough to accept your next audit result?