The Account

Raising standards

“Accountants will save the world,” Peter Bakker, CEO of the World Business Council for Sustainable Development, famously said in 2013. For that statement ever to come to fruition it needs finance professionals from across the globe to get up to speed on the new disclosure requirements introduced last year by sustainability standard setter, the ISSB.

To help address this, the Foreign Office is working in partnership with the Pan African Federation of Accountants (Pafa). Speaking to CA magazine at the ICAS Sustainability Summit, Ravi Abeywardana, Director of Strategic Affairs and Capacity Building at the IFRS Foundation, explained that the UK government is “providing seed funding to capacity build 125,000 accountants on ISSB standards”.

Abeywardana added: “The IFRS Foundation provides a role as a knowledge partner for the Pafa in its output… This partnership is designed to ensure those accountants are not left behind and can operate at a similar level to accountants elsewhere.

“The beauty of partnerships is bringing together people who are very much vested in the ISSB, to collaborate and address some of the capacity-building challenges that are required to turn these [reporting] standards into a reality.”

CAs in the news

Jonny Jacobs CA

Jonny Jacobs CA has become Holland & Barrett’s new Group Finance Director, joining the high-street wellness brand from Starbucks. “It will be a busy agenda ahead, shaping our future while leading our digital-first finance transformation across the CFO function,” he wrote on LinkedIn. Jacobs is also a member of the ICAS Council.

Carol Adams CA

In a new interview with Blue Sky Thinking, Carol Adams CA, Chair of the ICAS Sustainability Panel, reflects on her life at the forefront of global sustainability reporting. “When I started this about 30 years ago those of us researching social and environmental accounting and reporting were almost seen as a bit of a pariah, doing something weird and wacky,” she says.

Bill Cleghorn CA

Bill Cleghorn CA appeared on the BBC current affairs show, Disclosure. As a forensic accountant advising two sub-postmasters, he calculated they were due £1.2m compensation for the loss of their post office business, only for the pair to agree to pay the PO £10,000 instead, after it withheld the reasons behind its collapsed prosecution of the duo. Watch the whole episode here.

That shrinking feeling

Is “degrowth” set to be the next significant trend in sustainable business? A May report from Thomson Reuters explains that degrowth “involves cutting down on consumption by becoming more efficient – using fewer resources to produce more – and changing societal behaviours to prioritise sustainability and less materialistic lifestyles”.

Put simply, it involves people buying less stuff they don’t really need. Although the concept itself is nothing new, dating back to the 1970s, advocates hope that the combination of Covid and the cost of living crisis has caused consumers to rethink their spending habits and priorities.

Critics associate degrowth and the idea of deliberately trying to reduce GDP with socialism or even Marxism. But, as the report warns: “While the underlying viewpoint of a steady-state economy or degrowth may be in conflict with the traditional definition of progress in Western capitalist economics, in truth the global economy cannot sustain perpetual growth indefinitely on a planet with finite limits.”

CA magazine will be delving into the arguments for and against degrowth in a future issue.

Time out from the vicious circle

KPMG recently made headlines when the global accounting giant announced it would become the first white-collar British company to hire people with criminal records as part of a new scheme, run in conjunction with the Ministry of Justice.

Prison should be a deterrent, and, as the old saying goes, “you do the crime, you do the time”. If only it were that simple, though. Declaring a criminal record in a job application means, for many jobs, someone’s chances of being employed are all but over.

Yet the circumstances behind a conviction can often be complex. And condemning ex-offenders to a future of unemployment or minimum wage jobs makes them more likely to reoffend, and more likely to return behind bars. It’s a vicious circle that amounts to a huge drain on the public purse.

It is estimated that the economic and social cost of reoffending across England, Scotland and Wales comes to £22bn a year, which is more than a third of the annual budget for the Scottish government. And then there’s the incalculable emotional cost to the victims of crime.

It is worth stressing that the process of hiring an ex-offender is extremely thorough. There is too much at stake for all parties for it to be anything else. But there’s also the stark reality that companies of all sizes in the UK have a lot of vacancies to fill, while the prison population continues to grow. And one of the key reasons for that growth is fraud, which is now the most common form of crime in the UK.

KPMG should be applauded for taking positive action, and one hopes it will prove a test case for other big companies. While this is the first time a Big Four firm has joined a scheme to hire people with criminal records, others have worked on projects to reduce reoffending.

Some years ago I spoke to Judah Armani, an academic who, with the support of EY, worked on several initiatives around ex-offenders. Armani said many of them had a brilliant head for business, with a solid grasp of profit and loss, supply and demand, and so forth. Had circumstances been different, he said, they could have been successful, legitimate entrepreneurs. If that knowledge could be channelled in the right way into a corporate environment, then everyone wins.

RYAN HERMAN

THE ACCOUNT