The internal auditing profession has been urged to lift its game and weed out unethical or unlawful practices.

ASX Corporate Governance Council chair Elizabeth Johnstone says internal auditors need to be more courageous in raising “red flags”.

“They need to step up. They need to learn from some of the professions like medicine and aviation in doing root cause analysis. They've got to follow through and make sure that action is followed. When they've done their report, that's not where it ends,” Ms Johnstone told the ABC.

She also said some company boards are not paying enough attention to warnings and auditor advice.

“In my research, I've certainly discovered instances where internal auditors have had their work diluted, they haven't escalated appropriately and they haven't followed through,” Ms Johnstone said.

“Sometimes I think it's pressure exerted and sometimes I think they are not as bold as they need to be, making sure they maintain an independence of judgement and not be swayed by long-standing relationships with colleagues or fear of those senior to them.”

Ms Johnstone said the scandals emerging before and during the royal commission should encourage auditors to be more proactive in identifying risks.

“I am giving a bit of a rallying cry. There are things that I think could be done better,” Ms Johnstone said.

“Internal auditors should be more carefully chosen in some instances. I think they need to understand organisational psychology better or behavioural sciences broadly.”