I’m not the only one who’s worried. Adecco seemed to pay the price when just the possibility of compliance failure sent market players into a spin.
But at the same time, this is a real opportunity for finance professionals. There has been a fundamental change in the external perception of what counts in companies. Higher up the agenda are good corporate governance, accounting and reporting transparency, integrity of the information given to investors, and the question of corporate ethics.
The business consequences of reporting failures have become apparent. There is far more at stake than simply the numbers.
The headline-hitting crises appear to be in public companies where the pressure to ‘perform’ is at times almost intolerable and the rewards for keeping ‘in’ with the markets is enough to tempt anyone.
Fortunately the bulk of finance professionals work outside this hothouse, but they still have an important role to play in re-establishing financial integrity.
Talking to finance directors, it is clear that in many companies the executive teams will ‘get away with’ as much as the FD allows them to.
This is not a criticism. It is part of the dynamics of the creative business process. People need to feel free to develop business with a safety net that will ring the alarm bells when they go too far. For many companies, this is one of the finance director’s most important roles.
I can fully appreciate the frustration of the finance director who cries: ‘But why should I always be the one to say no?’
Perhaps it’s because, as trained finance professionals, we are often in a better position than anyone else to decide. It doesn’t mean we have to say ‘no’ to everything, but it does mean that we know where the lines should be drawn. It’s time to fully accept this vital part of our role.
- Pat Scott, partner and executive coach with Woodbridge Partners.