While the world of PR might seem a long way from accountancy, we should all take notice of the fate of a company that seemed to be riding high only a few weeks ago.
While Wikipedia is not an infallible source, I was still saddened to read the following paragraph: “Bell Pottinger Private (legally BPP Communications Ltd.; informally Bell Pottinger) was a British multinational public relations, reputation management and marketing company headquartered in London, United Kingdom. On 12 September 2017 it went into administration (bankruptcy)”.
I find it ironic that one of Bell Pottinger’s talents was reputation management. For those that have not followed the story, the company backed the wrong horse by taking on a wealthy client in South Africa and running a campaign that caused deep offence.
As a result, the Bell Pottinger found its name splashed all over the media for the wrong reasons, its trade body withdrew support and, within weeks, the liquidators moved in.
On the surface, most of us are probably shaking our heads and saying “it could never happen to an accountancy practice and certainly not my firm”. It could.
While we may not run PR campaigns across the globe, almost all established firms of accountants rely on a strong reputation in their specific market for ongoing success.
For example, if you specialise in a market and have the full support of its heavily influential trade body, getting a bad name by doing a single piece of substandard work could be fatal. The same would happen if you are a bigwig in the local Chamber of Commerce and lost their faith.
More likely in this day and age is involvement in an overly aggressive tax planning arrangement that falls foul of HMRC. In such a situation, your firm could now be named and shamed and, from 30 September, you might even find yourself heading for the courts, a hefty fine and potentially prison.
None of these scenarios is likely to be good for trade and while we all take great care to ensure that partners and staff are cautious, it is easy to see how something could go wrong thanks to a small misjudgement.
I wonder how many of those reading this article work in or run practices that have a person or people designated to oversee reputation and any potential risk? My guess is that unless you are at a Top 50 practice, this isn’t even on the radar yet.
While we may denigrate the influence of the media and more specifically social media, reputational risk is a fact of life in 2017. This means that if you annoy or antagonise a client or possibly a staff member, they can easily take vicious revenge in a way which could, in an extreme situation, lead to the demise of your practice.
You have been warned. Please take action before it is too late.
About The Imprudent Accountant
Someone who should know better, but can't resist the occasional rant about the more exasperating aspects of the accountancy profession.