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Thinking ain’t what it used to be

22 Apr 08

Some thoughts on what we know as "thought leadership"

A great ICAS discussion event in London last week brought together a broad spectrum of people involved in the profession. It focused on how well developments in accountancy and financial reporting are shaped by so-called “thought leadership” – research and policy recommendations made by firms, professional bodies and others. It was a topic I take a keen interest in – I believe ICAS can be very proud of the contribution it makes through its research and proactive projects.

The excuse for having the event was the 20th anniversary of the ICAS Making Corporate Reports Valuable (MCRV) report, which was one of the first proactive reports of its kind by any professional body. It was radical, well researched and influential. It was also highly relevant. Many of its recommendations are reflected in contemporary financial reporting. Last week’s panel comprised several of the committee behind the report – Sir David Tweedie, chairman of the IASB, Paul Boyle, FRC chief executive and Norman Murray, chairman of Cairn Energy. Immediate Past President Isobel Sharp steered much of the project as then ICAS technical director.

The discussion about the impact of current “thought leadership” compared to MCRV was revealing. The audience felt that the proliferation of research in the past 20 years has not gone hand-in-hand with a rise in quality. Quite the opposite. It was also felt that the aim of advancing the profession was being poorly served because many of the proactive projects are at best piecemeal and at worst, self-serving.

Most significantly for me, the overwhelming view was that there is a disconnection between the needs of users of financial information – investors, analysts and the wider public – and the people who are shaping the research and recommendations. In other words, current “thought leadership” pays very little heed to what may actually be the big issues that require solutions and development. When a lot of effort is being put into work that is doing little to serve the needs of the market and the public interest, maybe it’s time to ask – what’s the point? MCRV showed the profession the fundamentals of developing influential thinking. Time to go back to the future.

PS – I’d welcome views on an alternative phrase to “thought leadership”. All suggestions gratefully received!

 

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