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Green is the new black

Earlier this month, global leaders extended their carbon footprints further by gathering en masse in Copenhagen to discuss climate change and how to build a greener planet. Hopefully, this is a small, necessary step backwards to drive progress forwards; progress that is desperately needed after a decade of deference from the world’s largest polluters.

In my opinion, the link between global warming and the unabated growth of the world’s population is clear and total. In 1909 there were less than 2 billion people on earth, most without electricity (let alone TVs, computers, consoles and all the other gadgets plugged into my living room sockets). Our fragile eco-system simply isn’t able to handle the sheer volume of C02 that is being extracted from the ground, recycled in the air and sitting in our cupboards. Fewer plants + more humans + releasing hidden carbon doesn’t equal a sustainable planet. Anyone who fails to compute this simple formula may as well still believe that the world is flat.

For those wondering why a blog on climate change is relevant to accountants, there are several, simple answers. Climate change impacts everything around us: our families, our homes, our finances and our careers. We all need to play our part – whether through direct action, votes or simply through raising awareness. If you are still sceptical, here is some food for thought:

Our climate is changing your family’s future

You probably are, or hope to be, a parent. This presumably means that you want future generations to have the quality of life that you’ve been fortunate enough to enjoy. Over the past hundred years, every generation has been afforded more opportunities than the last due to technological advances driven by electricity. It’s quite possible that without creative solutions and a change in attitude our grandchildren will face shortages of everything we take for granted today. Put very simply, wasting electricity by leaving lights on overnight means less energy for your children’s children in the future.

Our climate is changing your finances

Anyone who has been looking at their household bills recently will have noticed a continuing rise in the costs of shopping baskets. It’s easy for the media to blame Tesco for strangling suppliers or oil companies for profiteering, but the combination of drought and farmers shifting from food to industrial production are the real causes of higher prices. Even if official figures claim that the inflation rate is close to zero, the cost of living for households IS rising (these days the RPI basket is loaded with products that are more or less intangible – for example, CDs, whereby no-one is really buying a little plastic disc, thereby distorting the measure). This erosion of ‘disposable’ income means that the frugal have less to save or contribute to pensions and face shorter retirements than their hard work deserves. Consider this: choosing to cycle rather than drive this weekend will save some extra pennies and take a small step to reducing drought in far away lands.  

Our climate is changing your career

Accountancy by its very definition is a function of commerce and economics. Our skills are needed by businesses, whether they are starting, growing or surviving. But, is our world economy (and, by association, our careers) sustainable? It’s unlikely to happen immediately, but current energy resources are finite and will one day run dry. The oils and gases that have taken centuries to form are being used to build major corporations. But what happens when these resources run out? You don’t need accountants if there are no beans to count. We need to be selfish; get our companies to cut costs by reducing energy consumptions which will help sustain the business and the need for accountants.

The choice to meet in Copenhagen is poignant. If the seas continue to rise unabated, the little boy with his fingers in the dyke could soon be floating down the streets of the Danish capital and our hopes and dreams could be following him.

By the time Barack Obama flies into Denmark tomorrow, hopefully a lot of big changes will have already been agreed upon. Global policy, guidelines and regulation will help slow down the warming and drive a greener planet. As one in seven billion, all each of us can do is our ‘little bit’. That’s a lot of little bits.

Colin qualified with Arthur Andersen in 2000, eventually leaving in 2002. After a brief stay at Centrica, he joined Carphone Warehouse and worked in assorted roles with Talk Talk and Geek Squad as Finance Director. After working with friends at Mint Digital, a social media agency, Colin is now looking for a new challenge.

Bah Humbug

The nights are drawing in, Starbucks have turned their cups red and the shops have dusted off their seasonal music collections. It can only mean one thing: Christmas is on its way.

Christmas is, first and foremost, a religious festival. However, both socially and economically, if Christmas didn’t already exist it would be a fantastic invention. For a Victorian factory owner producing textiles for the masses, Christmas would have made a huge difference. There would’ve been increased demand for his products as consumers bought or made presents for their families. His tired workforce would have had the opportunity to get some rest on the bank holidays and build up their energy stores by overeating. The times spent with family and friends would erase memories of the hard slog in the workhouses. Christmas would have been the perfect antidote to the effects of cold, dark winter nights and a perfect tonic for economies in hibernation.

Admittedly, it’s almost impossible to imagine a world without Christmas. That’s why it’s incredible to believe that, in workplaces up and down the country, it’s like The Grinch has stolen Christmas. Conversations with friends suggest that there are a number of British companies who have chosen to dispense with a Christmas institution, the Office Party. But why?

There are usually polar opinions on the value of the Christmas Party: those who think it’s a waste of money that could be better spent elsewhere, and those who think it’s critical to rewarding the workforce. Often these views follow Jungian patterns: the logical and un-emotive can live without the parties, but those who are more intuitive and feeling value opportunities for bonding. One could probably stereotype these as the ‘Accountants’ View’ and the ‘HR View’. Imagine the following board room scene:

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It’s the November board meeting at Marley Corp and the board has come to the final agenda item: the Christmas Party.

Mr. Scrooge, the FD of Marley Corp, thinks that the Christmas Party is a waste of money. The company employs 10,000 people in the UK and to spend £50 a head on a party is £500k down the drain. Scrooge (being an accountant) will also tell you that it’s not just the direct costs that matter. Marley Corp has a big Christmas order to complete and he knows that the-morning-after-the-night-before is going to be pretty unproductive … and that’s the staff who appear for work at all. Scrooge has estimated that there’s at least another £500k of costs the following day. Profits are tight at Marley Corp and Scrooge sees cancellation of the Christmas Party as a quick win to cut costs. There wasn’t a party last year and the company seems to be holding steady despite the recession. He’s strongly suggesting that they cancel the party again this year.

Mrs. Cratchett has a different view. She’s the Director of People and has been fighting retention and morale issues all year. Absence rates have gone from 2% to 3% since last Christmas, in part due to the late cancellation of the big annual party. Annual employee attrition has also increased, from 20% to 25%, despite Marley Corp holding sales and employee levels constant. As far as Mrs. Cratchett is concerned, Christmas provides an opportunity to boost morale by giving something back to the workforce, not taking it away. She has asked one of the finance team to do some analysis on the costs of the additional recruitment and impact of absence but they’ve been working on Mr. Scrooge’s presentation instead. She thinks that the savings from improving employee satisfaction could be in the millions next year.

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Who will the board side with?

It seems that in a lot of boardrooms across the UK, the Scrooges are winning. During a recession, jam today seems to be more valuable than a bit more jam tomorrow. This may well prove to be a sensible rather than selfish decision, but before directors and managers make the stereotypical choice about celebrating Christmas with colleagues, maybe it’s time to brush up on their Dickens and give in to the Spirit of Christmas.

Colin qualified with Arthur Andersen in 2000, eventually leaving in 2002. After a brief stay at Centrica, he joined Carphone Warehouse and worked in assorted roles with Talk Talk and Geek Squad as Finance Director. After working with friends at Mint Digital, a social media agency, Colin is now looking for a new challenge.

Is it time to run the United Kingdom like a business?

Even the most politically apathetic will have noticed that something has changed in the media recently. Politics has become headline news, and not just over the behaviour of our MPs. You can’t tune in to a radio talk show without debate over whether Gordon Brown’s days are numbered. David Cameron has even knocked Katie Price on to page 7. Why? Because a General Election has to take place in 2010 and the major parties are looking to impress us to win our vote. Political PR companies are in overdrive, party volunteers will be canvassing on your doorstep and national newspapers with be flying their red or blue flags.

For the first time in almost a generation, the General Election will take place on a backdrop of recession. Unemployment has risen significantly in the last two years, house prices have fallen and as a country we have a ‘structural deficit’ of £175bn. All is not rosy and we, as voters, have to decide which is the best horse to back in order to improve the situation. This seems a daunting proposition; do you believe that we should spending more on public services to keep our economic wheels turning, or do you think that we should reduce the wastage of interest payments by cutting expenditure to shrink the national debt?

Governing 61 million people is no easy task, but is it really that much different from managing the massive companies that provide essential services to our country? Politicians and their bag carriers would have you believe it’s the hardest job in the world.

Many senior managers (many of them trained accountants) in various businesses across the UK have had to face the recession full on. They’ve also had to make huge decisions affecting the same people who get to cast their votes next May. It’s interesting that our rationale as corporate managers is often very different from our rationale behind our voting principles. But are these two issues really that different? Surely the Chancellor is the country’s Finance Director – shouldn’t he or she apply the same principles?

Like any finance team in the country, sometime in the next year the new Chancellor will need to:

• Work out how much revenue will be generated from tax;
• Assess the expenditure from central spending plans;
• Calculate the difference between the two, and if it’s not a positive number one of the two above has to change;
• Understand how much money the Government owes its creditors, and ensure a plan is in place to balance the books over a sensible timeframe.

Maybe it’s a gross oversimplification, but it’s still a fairly straightforward process that every accountant has undertaken at some point.

As Finance Director of the country, the Chancellor will need to influence the assorted Operations Directors who want to spend, spend, spend in their areas of responsibility to remain popular with staff and customers. The Sales and Marketing Directors (whoever they are in Westminster!) will have to justify how they will protect the UK’s global brand, while generating the revenues needed to keep home and foreign services going. Ultimately, those plans will need to be realistic and Messrs Brown, Cameron or Clegg (as CEO of UK Inc) will then pledge these plans and strategic objectives to his stakeholders. Is that so far removed from the corporate planning processes we know?

I’m sure most of you have never had to fill a £175bn budget gap or had to squeeze a few billion pounds of savings from your plans, but surely it’s just a matter of extra zeros. Spending cuts in companies and public services have the same results; a loss of jobs that will probably impact on future sales (or taxes) in the longer term. That’s the balance that boards everywhere will need to find. It just so happens that the public gets a chance to vote on which board they want for the next 5-year plan, which might be an option you wished you had this budget season.

When I eventually get my time in the polling booth I’m going to dismiss the zeros and spin and think, “Which Finance Director do I back for the next 5 years?” Are you?

Colin qualified with Arthur Andersen in 2000, eventually leaving in 2002. After a brief stay at Centrica, he joined Carphone Warehouse and worked in assorted roles with Talk Talk and Geek Squad as Finance Director. After working with friends at Mint Digital, a social media agency, Colin is now looking for a new challenge.

@roughanc has a new status update and is now connected to 4 people…

Stephen Fry does it. Barack Obama does it. Even @educatedbees does it. The Twitterati are everywhere these days, but does ‘social media’ have any use in a professional context other to while away hours of boredom?

I know a lot of people who refuse to use Facebook and Twitter. They often “don’t get it” (a frequent quote), are too busy or prefer old-fashioned ‘media’ like the telephone or meeting for a coffee. Personally, I think there is a place for all of these tools to stimulate social interaction and emotional development as well as to maintain and strengthen our professional networks. A beer on a Thursday evening is great, but so is a chuckle at a witty observation on the state of the rail network at 8am.

I’m not going to preach to you about social media. I’m sure that the last thing anyone wants to read is a sermon on 'Web 2.0'. Despite the hype from the cool guys in your marketing departments, social media isn’t quite the next Industrial Revolution but to dismiss it as a fad is short-sighted. These new online tools can be of use throughout your professional career and even more so when you searching for a new role. How? Why? Here are some reasons:

Research – At its most extreme, Twitter is a glut of banal comments about very little, but imagine you are considering a new job at large corporate. Using Twitter search allows you to very quickly mine the Twitter universe for the opinions of its stakeholders and customers in the rawest of forms. I’ve searched the name of a 250 year-old drinks group to find that they’ve launched a new whisky brand, are moving from ‘advertising campaigns’ to ‘movements’, got a $2bn tax break recently and are about to buy a Tanzanian beer. Google would have given me links to the staple stories via trusted news-sites, and probably a lot less memorable things to say in an interview!

Benchmarking – Finance professionals are of course human; we need to benchmark our professional progress. Aside from reading impersonal salary surveys, we often compare ourselves to our peers, both consciously and unconsciously, when measuring our career successes. Within our own organisations and ‘offline’ social network this is relatively easy, but online social media tools such as LinkedIn can, amongst other things, help to feed our curiosity about past colleagues success. Used in the right way, objectively and rationally, it can be both heartening and motivating to see how others who made similar choices have fared since. Seeing a former colleague who has started his own consultancy might just spur you to think about the same possibility, make contact and take some advice that will change your career direction.

Networking – Finding a new role or challenge is hugely dependent on how many people you know and how active you are within that network. That’s not to say that having 750 Facebook friends means you are one of life’s winners, but it maximises your chances of reaching that charity donation target, finding a home for an unwanted sofa or getting a response to “Colin is looking for a new job. Can you help?”. LinkedIn, Facebook and Twitter all expand the reach of your network and, when managed sensibly, can create new opportunities from the most unlikely places. Almost all good companies to work for spend a lot of time and effort encouraging their staff to act as advocates and ambassadors, often rewarding employees handsomely for recommending friends to join the company. Facebook acts as great platform for spreading these messages in a trusted environment, and every so often I’ve sent or received an email suggesting a possible opportunity at Company X to people I know might be interested. It doesn’t stop me posting pictures of funny things or bizarre status updates, but it does have some professional benefits too.

In addition to the above, more recruiters are starting to use LinkedIn and Twitter in particular, providing yet another route to market for your CV or to the job grapevine.

And of course, there are still those boring teleconference calls that you can liven up.

If you haven’t tried any of these tools before, I hope this short piece has given you a reason or two to give it a go. I guess I’ll wait to see how many new followers I get on Twitter (@roughanc).

Colin qualified with Arthur Andersen in 2000, eventually leaving in 2002. After a brief stay at Centrica, he joined Carphone Warehouse and worked in assorted roles with Talk Talk and Geek Squad as Finance Director. After working with friends at Mint Digital, a social media agency, Colin is now looking for a new challenge.

Money for nothing? That’s your opinion…

The latest target for the G20 finance ministers who have been meeting in London has been tax loopholes, and how to close them. But it’s 2009, and as ever the subject of bankers bonuses was never too far from the agenda. To be honest, since the Thatcher years we British have always had an obsession with City ‘excess’, whether it was The Flaming Lamborghinis, TV’s Capital City or pantomime villain Fred the Shred. Even as far back as Shakespeare’s time, the role of bankers has been under scrutiny; when I read The Merchant of Venice at A-Level I didn’t aspire to be like Shylock.

Today it seems that everyone has an opinion on banking bonuses, from the woman on the street to Barack Obama. Many commentators feel that the involvement of governments and regulators in setting the rewards for a small number of banking employees is unnecessary, if not overkill. Others think that the only way to resolve the matter is a salary cap like in Rugby League or American Football. Some simply think that a £1m bonus for doing a desk job is vulgar, irrespective of their personal voting preference.

Economic principles are partially responsible for the different viewpoints on reward. Laissez-faire believers think that the market will ultimately drive pay and bonuses into the right place, but it will simply take time. Interventionists on the other hand believe that the ‘market’ for top banking talent is ineffective or non-existent and therefore different rules are needed. But it’s not only economics that are at play.

Politics and public opinion are also muddying the water, and Labour are desperate to show their detractors that that they can be decisive. Obama must be seen to support ‘America’s Big Business’, and the flow of capital to fund it. Nicolas Sarkozy knows that France lag behind in the banking sector so has nothing to lose by being more radical in his views. The editors of tabloid newspapers need to raise circulation and a few vintage jeroboams always make for a good banker-bashing story.

The FSA’s response to bonuses highlights some of the problems that even the most objective (in theory) can face in coming to a conclusion. On one hand they have accused politicians of “passing the buck” to regulators, but on the other have issued a code of practice to banks. This has resulted in a somewhat half-pregnant position borne out of a combination of responsibility, obligation and frustration.

Very simply, there is no magic bullet, and the continual meddling by governments, quangos, media and other parties will simply serve to draw the debate out longer (I suspect until the upswing becomes a boom, the FTSE hits 5,000 points and England win the World Cup).

If there is a message to take from this macroeconomic melee to apply to our own spheres of influence, it would be to look at how we approach our own process of target setting and the resulting bonus debates in our companies. Finance professionals often have to set targets for peers whilst also trying to overachieve on their own bonus objectives. We need to do this with integrity and fairness but also to keep focus on the commercial objectives of our organisation, both in the short and long term. We need to ensure that our team is constantly motivated, but not only through monetary reward. The glass half empty view is that even for a handful of bankers, the collective brainpower of the world is finding it hard. The glass half full view is that we can probably do better ourselves.

Colin qualified with Arthur Andersen in 2000, eventually leaving in 2002. After a brief stay at Centrica, he joined Carphone Warehouse and worked in assorted roles with Talk Talk and Geek Squad as Finance Director. After working with friends at Mint Digital, a social media agency, Colin is now looking for a new challenge.

Self-dedication

World-class performance requires a lot of hard work and dedication, not just a tick in a box.

This week has been a huge week for sport. A man has run 100 metres in less time than it takes to name the Big 4 accounting firms, the credit crunch-proof Premiership season has kicked off, and we’ve still got a hope against the Australians in the cricket. On top of that, the unbeatable ‘Sunday Tiger’ was tamed in the USPGA Championship.

Watching all these dedicated professionals competing in their fields made me realise the practice, sacrifices and dedication it takes to win a World Championship heptathlon, a Grand Prix or Golf Major. Just because it’s ‘sport’, it’s all too easy to forget that these men and women are excelling in their fields. For anyone, accountants included, to be as successful in our chosen careers, we need to look at how much effort we are putting into our abilities and skills to compete in the modern workplace.

Even a snooker or darts player competes or practices every day of the week. Top footballers are lucky to get a three week break every two years. But most accountants, myself included, get a reminder to complete their Continuous Professional Development (CPD) self-certification and then rush to tick a few boxes online. How much effort have I really put into keeping my ‘fitness’ in the last 12 months? Very little, compared to a top athlete. I had to be reminded to fill in my CPD submission this week – that’s how much effort I’ve invested.

I appreciate that most finance professionals have very heavy workloads and regularly put in long hours which makes the parallels to sports stars a little disingenuous. But, if you ask most accountants if they really feel that they’ve stretched their abilities and skills as much as they wished that they could, the answer would probably be “ummm … no”.

On a recent holiday I took the opportunity to catch up on some essential business reading. It’s reignited my thirst for knowledge that will further my career. The books weren’t strictly accounting- related (‘Free – The Future of a Radical Price’ by Chris Anderson, ‘What they teach you at Harvard Business School’ by Philip Delves Broughton, ‘The Accidental Billionaires ...’ Ben Mezrich), but did involve a heady mix of finance and economics.

My personal challenge for the next CPD year ahead is to keep up this brain-training regime, whilst flicking between various sports programmes of course.

Colin qualified with Arthur Andersen in 2000, eventually leaving in 2002. After a brief stay at Centrica, he joined Carphone Warehouse and worked in assorted roles with Talk Talk and as Finance Director. He’s now working with Mint Digital, a social media development agency based in Vauxhall.

Preparation, passion and competition

Before I start I feel obliged to set this post in context; this week has been the first in my working life where I’ve not had a full-time job. Fortunately it’s through choice (of sorts) but nonetheless, as a finance professional searching for the next big thing I have a lot of empathy with the 2.4 million people who are officially unemployed and the numerous others who are under the government’s statistical radar.

Being flexible, I decided to try something different and, as a result, this has been a pretty interesting week. A week that has taught me a lot of lessons that I thought it might help to share if you’re looking for work or a change of direction.

I’ve only had one interview this week so far. A very brief one. The shortest I’ve ever had. Or ever will (I hope). Legally I’m not allowed to discuss the details but suffice to say that it wasn’t a tête-à-tête with a Group CFO on an industrial estate in Berkshire. Instead, I crashed and burned in front of other ‘hopefuls’ whilst trying to win a place on a business-based, reality TV programme. Crash is probably an understatement, think 13 car pile-up.

I’m not seeking sympathy, but instead I’d like to highlight the reasons for my abject failure despite a pretty smart suit and well-shined shoes. Common mistakes that can happen in all interviews. Mistakes that the way I felt as I trudged home, deflated, will mean I don’t repeat.

It seems so obvious now but I was woefully under-prepared. A combination of arrogance (“I’m good enough for this”) and a failure to walk the process through resulted in my ‘rabbit in a headlight’ moment. Preparation, preparation, preparation. Those words get repeated over and over. But they are so true. It doesn’t matter if it’s 30 seconds or 30 days that you’re planning for. Be prepared. I was a cub scout myself but I didn’t heed Baden Powell’s advice. I should have. Maybe Bear Grylls will have more success.

There’s no such thing as being ‘over-prepared’ if you’re trying to achieve something like a new job. In my mind, I thought that people who were keen were being sad or swot-like. They were actually being smart because they gave themselves a chance of making the cut. My failure to prepare was like signing my own death warrant. I was the golfer who didn’t bother with the putting green before the final round.

The second lesson is that you have to be passionate about what you are trying to achieve. I’ve noticed, when conducting interviews, that the poor candidates appear to be less than enthusiastic and the interview feels flat. This can be overcome by practice and personality, but it’s hard to disguise a lack of passion. My own experience demonstrated that my competitors simply wanted the prize more than I did, and I struggled.

A third lesson is that, like it or not, almost everything you will ever strive for is a competition. Even if it’s an interview for an internal promotion, you’re competing against any or all of the following: your peers, your past, your boss’s ego or a perception of the external competition. You need to put your game head on and think through what it would take to win the prize. It might be counter-intuitive for many meek accountants, but without a bit of competitive fire you’re almost always going to get out-gunned.

With a combination of preparation, passion and competitive spirit I’m confident I won’t have an experience like I did again (certainly one that I could control). Hopefully by sharing this, you too can avoid the pitfalls of the interview from hell!

Colin qualified with Arthur Andersen in 2000, eventually leaving in 2002. After a brief stay at Centrica, he joined Carphone Warehouse and worked in assorted roles with Talk Talk and as Finance Director. He’s now working with Mint Digital, a social media development agency based in Vauxhall.

Newly qualified and lacking direction? You’re not alone…

Ten years is a long time, but it’s almost that since I qualified with a ‘Big 6’ firm (the number of firms used in this description is inversely proportional to your age!) and I was recently reflecting on how little support there really is out there for a 24 year old who is coming to the end of their accounting contract.

At sixth form there’s a guide that tells you everything there is to know about your preferred university (down to female-to-male ratio) and in your third year you’re bombarded with career fairs and guides. But after three years of study, play and a bit of work as an auditor, where do you go?

You’re caught between a rock, a hard place and some other stony ground. Who do you approach:

1. You give in and eventually return that call to John at Best Jobs in the World and Partners. He’s got the best job ever. Great opportunity, loads of promotion prospects. £5k more. A car allowance! But it’s on an industrial park on the outside of the M25. two trains, one minibus and you’re there in less time than it takes to play a Premiership football match.
2. Do you talk to Henry who joined in your intake but left after a couple of years to join a start-up. Audit is boring, right? The real world is much more fun. Or maybe Susan, your audit senior, who went to work in M&A? No ticking and bashing for her. Ok, so they may (or may not) have done well for themselves but there’s always a tendency to rubbish those who stay. It’s often not an objective viewpoint.
3. You’ve got a Partner Mentor. No chance, she’s devoted her life to controls testing and audit opinions. Maybe that manager who’s always taking his team out for drinks. He’s cool. So he gives it straight. The grass is always greener. Ah, sadly he’s been brainwashed too, you think.

Hmmm. Maybe you’re lucky and you’ve got a big brother who’s got the t-shirt. But, if you are like me, you’ve got to try and see the woods for the trees and take a punt. 

My punt was a mistake. I ended up taking Option 1. I should probably have listened to Option 3 but I suppose I wouldn’t change things. You can’t have regrets.

Ten years on I’d give the same advice to anyone in my shoes. Use the internet, use your network, keep an open mind and think “what would make me really happy”. Don’t get rushed into any decision by your peers, your managers, or someone who calls you that you’ve never met! But, what I have learned is to make a decision because there’s very rarely a wrong answer, just different outcomes…

Colin qualified with Arthur Andersen in 2000, eventually leaving in 2002. After a brief stay at Centrica, he joined Carphone Warehouse and worked in assorted roles with Talk Talk and as Finance Director or Geek Squad. He’s now working with Mint Digital, a social media development agency based in Vauxhall.