Which component of the COSO framework focuses on ethics and integrity?

The component of the COSO framework that focuses on ethics and integrity is the Control Environment. This foundational element establishes the tone for the organization, influencing how control processes are viewed and how they operate. The Control Environment encompasses the organization’s ethical values, commitment to integrity, governance structure, and the overall atmosphere in which employees conduct their activities.

An effective Control Environment promotes a culture of accountability, integrity, and compliance with laws and regulations. It includes the organization’s mission, values, standards of conduct, and management's approach to ethical issues. By ensuring that ethical behavior is expected and modelled by leadership, it creates a framework within which the rest of the components of internal control can be effectively implemented.

In contrast, the other components, such as Risk Assessment, Information and Communication, and Monitoring, contribute to the internal control effectiveness but do not specifically emphasize the role of ethics and integrity in the same direct manner as the Control Environment does.