Audit-is-cool presents an excerpt from
the Interview of Simon Collins (Chairman & Senior Partner KPMG UK).
Lane Mean: Hi, I am Lane Mean, I am content
director of local world newspapers and I am introducing this evening Simon Collins.
Simon is the chairman of the KPMG group, one of the big four. The debate tonight
is actually being sponsored by the Bristol Post.
Simon you are seen as
something of an inspirational leader in accountancy terms in the big four. How
have you achieved this do you think? Because you were actually voted in as
chairman by your peers, were not you?
Simon: Yes we had a pretty full
blooded election, so it‘s a real democracy. 600 partners chose who they wanted
to lead the firm for the next five years.
Lane Mean: So why do you think you
won that?
Simon: I think you would have to
ask the 600 truthfully but I think you the sort of messages I think were
important to the partners were about a clear sense of purpose and direction
about where the business goes, where it fits in society and a very big theme
for me was how we put trust and respect back into business and the accountancy
profession and KPMG.
Lane mean: And how do we because, I
mean I am not bracketing you in the same way as bankers, but a lot of mistrust
in the financial area is not there?
Simon: I think there is a huge
amount of mistrust, I think broken is the only way to put it between business
generally and society and I think there is a number of reasons for that .We have got in almost every
industry there is an example of behaviors that you cannot hold up and say that‘s
what good business is. So whether it’s pharmaceuticals and rivalry, whether
it’s horse meat, whether it’s liable miss–selling, whether its tax, every
industry has got something that damages trust. So I think we have got a long
slow journey to claw that back through good behavior and actually concentrating
on doing the right.
Lane Mean: But how can you hope to
do that because you have got loads and loads of partners have not you?
Simon: I don’t think that in a
sense is the difficult bit, I mean certainly for us as a firm we have integrity
and responsibility really close to our hearts and frankly the partnership model
is really good. I don’t think I have got a single partner who does not care
passionately about leaving the business in better shape than they find it and
so doing the right thing, I think comes naturally.
Lane Mean: Yeah I mean the right thing,
so what is right thing for a member of the “big four” like KPMG?
Simon: The right thing is to
advise clients responsibly, to behave with integrity, to be a true commercial
animal. I make no apology for profit being a big part of what we are trying to
achieve to be sustainable business you have to make profit you have to be
successful, but to be sustainable and to pass on a better business you also
have to have at least a benign footprint in society, better still if business
can actually contribute to society and leave good behind.
Lane Mean: Is it ethical to advise
people to dodge tax do you think?
Simon: No if you ask question
like that, no. Is it ethical to take advantage of legislation that specifically encourages companies to locate
in the UK and to take advantage of tax breaks yes. So I think where we get into
trouble in part of that trust equation is when there is a lack of clarity about
what we‘re talking about. Genuinely agree just bad behavior in tax planning is
immoral, just outright wrong and we
condemn it, the big accounting firms
will have nothing to do with it , utilizing
tax breaks that are specifically put in place by government to compete internationally, to encourage investment and
people to come here and do business is a really good thing to do. Good things to do for society at large
and we get mixed up with that.
Lane Mean: But when we see companies
going before select parliamentary committees as we have done and being frankly
terribly embarrassed, I am not saying that you are involved with any of those
people ,but it’s not good is it when the public sees that?
Simon: No it’s really bad for
trust but I think what we have got to look at is several things , you have got to look at whether companies have been lawful and
then whether politicians and society like the outcome of them being lawful, so
if you look at some of big companies in the news for paying low headline rates
of corporation tax ,that looks on the face of it something that doesn’t work for
society, but they have got there
without a breach of law at all, and in fact
in many cases they have got
there specifically taking advantage
of things the government, successive governments have intended them to do. If society and
government does not like the result of
that , which is that company X only pay 5p in the pound corporation tax, for me
and for the profession. I think that’s a problem for legislators and not a
problem to parcel out to tax advisers.
Lane Mean: No, now the day after the
election, the budget rather, not the election, we are talking, I mean if you
were in number 11.What would you do in terms of your first budget if it was
yesterday? Have you got some thoughts on that?
Simon: I think that I wake up
many days grateful. I am not in number 11 or politics generally, and I think
one of big problem on number 11 anytime. NOW or recently is being not a great
deal of money or flexibility to do things. it seems to me what the chancellor
was looking to do, was to encourage growth in the economy to make the cake
bigger and actually to get Britain exporting again, manufacturing again, and to
the extent the limited money available was directed in those directions,
actually I think it was a pretty decent budget for business.
Lane Mean: what about the grey vote,
now lots there wasn’t there? Lots to encourage people retired people, to vote
for the coalition in a year’s time?
Simon: I don’t know about voting,
I think there was a lot for savers and there probability is, I think you’re
right ,there’s probably a correlation between savers and the grey pound and so
on .I think there was a lot there to actually encourage saving and actually
investment indirectly as well and I think again you know that goes around in a virtuous
circle for me with encouraging investment in industry and growth in manufacturing
and so on ,so I don’t know ,I am sure, you’d have to ask the chancellor what
his political ambitions were around those things, but from an economics point
of view I think they made perfect sense.
Lane Mean: So what are you advising
your clients from today on about how they see the next couple of years? Because
you know we are going into election in a year’s time you will have a view about
that?
Simon: Well it’s not so much
political thought what we have got .we have got 24 offices up and down the
country ,we look after companies from relatively small companies right through
to the multinationals what we are seeing is a definite uptick in sentiment
.definitely a more positive feel from our clients up and down the country
.manufacturing, export, every, one feeling a little bit brighter .The growth figures
support that ,job creation support s that ,so I think for the first time in
quite a few years we have got what I would describe as a “benign back cloth
“for business to plan .now we have also got some uncertainties we have still
got very topical things around the Ukraine and political uncertainty, geo-political
uncertainty if you like, Scottish independence is worrying people it’s not much
that business should have or does have an outright view of right or wrong it’s
simply uncertainty .So we have got, now we are in march, we have got general
election next may. Business does not like uncertainty. On the other hand it’s
learnt to cope with it, and I think overall watch for uncertainty, but invest
into that “benign back cloth”.
Lane Mean: And what about you? You
have got a five year plan. I guess in
your head? You are an accountant, accountant plan, so what’s the five years
plan?
Simon: The five year plan, if
you start at what I think of as sort of 70,000 feet, the five year plan is to
leave behind a better business after my period of leadership than I inherited,
and I think all leaders should have that in mind. I want to leave the business
prouder, financially stronger and with a better footprint in the communities
what you referred to earlier, than I found it.
Source
Complete Interview can be watched at
the following link.
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