Bank job casts doubt over Zalm's future
Gerrit Zalm, chairman of the International Accounting Standards Committee, accepts job as chairman of Dutch bank Fortis and ABN Amro, raising fears of a conflict of interest
Gerrit Zalm
The most senior trustee overseeing the work of the
International Accounting
Standards Board has been accused of facing a conflict of interest after he
was recently appointed deputy chairman of Dutch bank
Fortis and
ABN Amro.
Gerrit Zalm, chairman of the International Accounting Standards Committee
the non executive body overseeing the IASB, the key standard setter for business
last week accepted the job at Fortis and ABN after it was offered by the Dutch
ministry of finance, which is organising the merger.
There is now speculation that Zalm will not be able to continue in his IASC
post because of potential conflicts of interests.
One senior UK financial regulator said he thought it was ‘highly likely’ that
Zalm would have to step aside while others believe that the two jobs would be
difficult to ‘reconcile’.
Nicolas Véron, a research fellow of the Bruegel Institute in Brussels, said:
‘Zalm does not seem to have left a huge mark on the IASB/IASCF so far; and given
the role played by Continental European banks in the recent discussions and
controversies about fair value, it would be awkward that the chairman of the
trustees would simultaneously be head of a large European bank.
‘This would be perceived by most market participants as difficult to
reconcile with the IASB’s full independence from specific interests.’
However, the IASC said the bank appointment would not interfere with IASC
duties.
IASC operations director Tom Seidenstein, said: ‘It should not affect his
ability to under take his duties. However, we will have to assess it once he
gets into the job.’
Zalm’s departure would come at a bad time for the IASB, which is under
pressure from leading politicians and bankers to reform the use of fair value
accounting in the wake of the credit crisis and the huge writedowns reported by
many financial institutions.
Last month, Zalm wrote directly to all heads of state at the Washington G20
meeting amid fears that the independence of the international standard setter
could be compromised throwing doubt on the future of international standards and
the standard setter.