10.2. HISTORY

The CSA concept was originated in the late 1980s by Bruce McCuaig, then at Gulf Canada Resources, a subsidiary of Gulf Corporation. Another CSA pioneer at Gulf, Paul Makosz, assisted McCuaig in developing CSA into a process that could be used to measure soft controls, which traditional audit techniques could not measure. These soft controls include things like management's integrity, honesty, trust, willingness to circumvent controls, and overall employee morale. Collectively, these attributes comprise an organization's corporate culture, which is often derived from the tone at the top. This phrase refers to the fact that unwritten accepted corporate standards of conduct take their cue from the behavior and actions of the leaders of an organization; key officers such as the chairman, chief executive office (CEO), president, and other senior executives. The reason for wanting to measure soft controls is that soft control failure has often been attributed to the demise of many failed organizations. In fact, soft control failure coupled with a rapidly increasing interest rate environment were almost entirely responsible for the near extinction of the savings and loan industry in the United States. Because of his early experimentation and continuing enhancements to CSA approaches, as well as his efforts to promote CSA, Makosz is now considered by many to be "the father of CSA."[] Both McCuaig and Makosz have left Gulf Canada Resources and established successful consulting ...

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