Public confidence in business has taken a hit this year. Scandals such as the collapse of Carillion have led to a nine per cent fall in the number of people who think that UK business has a good reputation. The accounting sector has not been immune to this, with the accountants who audited the bakery chain Patisserie Valerie being investigated, and the audit market being probed by the government. It’s vital for accountants to help ensure that they and their businesses are working responsibly, and that their activities do not affect their communities negatively.
AAT has released a white paper to encourage more businesses to behave responsibly, created as a result of a roundtable event featuring representatives from organisations such as the Federation of Small Businesses, the Organisation for Responsible Business, and Work for Good. The paper includes ideas of how accountants can do their part to help create a responsible business culture.
One recommendation made is that there needs to be better protections for whistle-blowers, including those who work in the accountancy profession. This is a reflection of the fact that in scenarios such as Patisserie Valerie, accounting professionals involved could have spoken out earlier if they had seen wrong-doing and were confident they would be protected. This also tallies with a recent survey which found that nearly two thirds (65%) of accountants believe that businesses do not do enough to protect an employee against victimisation or dismissal should they report the misconduct of a colleague.
In extreme circumstances, accountants can face pressure from clients or managers to carry out their work in a dishonest way. The amount of money many firms are dealing with, and the relationships they have with large companies they work with are so valuable that it can be hard for accountants to flag concerns around responsible business. However, knowing that you could become a whistle-blower and speak up without fear of damage to your career or reputation could give more professionals the strength to push back.
Helping prevent late payments
Another aspect of responsible business which the white paper focuses on is late payments. This is a huge problem, especially for small businesses, who can struggle financially if they get paid late; in some situations it can even lead to them going out of business. The white paper suggests that increasing use of automation and technology in the accountancy profession could help businesses avoid being paid late, by increasing their ability to automatically create invoices and send automated reminders to creditors to help them gain payment.
Technology is said to be changing the role of accountants, and this is one way it can make sure accountants are a force for good for the UK’s business culture.
In addition to helping their clients be successful, accountants can also guide them towards working responsibly – especially smaller businesses who may lack in certain internal resources. If you are an accountant with several clients, not all of them may share your responsible business values. If that is the case, you could attempt to change the client’s mind-set and point out where they can make changes.
Accountants should also be wary of falling into a trap where they are only concerned about the bottom line; businesses may try to do something responsible, but accountants who aren’t conscious of working responsibly might be reluctant to support them in doing so, because they are not able to see how it will immediately help the business’ profit. This is where it helps for accountants to have a responsible business mindset too, so that they can recognise the value of working responsibly separately from the monetary value. Teaching young accounting professionals about the importance of being responsible in business at the beginning of their careers could be effective, creating a ‘positive’ cohort and ensuring the next generation of leaders have the right qualities and training.
AAT has committed to being a more responsible business. With our actions such as gaining accreditation from the Living Wage Foundation, signing up to the Women in Finance Charter and the Prompt Payment Code, and becoming a member of Accounting for Sustainability we hope to lead by example. We aim to inspire our members and students to do the same as finance professionals with their organisations and clients.
Adam Williamson is Head of Professional Standards at AAT (The Association of Accounting Technicians)