PUBLIC AFFAIRS AND MEDIA RELATIONS BLOG - Clive Booth

Does the World Economic Forum really matter?

This year's World Economic Forum in Davos begins this week with the theme of 'Rethink, Redesign, Rebuild'. The last time someone called Dav[r]os attempted to rebuild anything, we ended up with the Daleks, but with the disjointed and discursive nature of the forum I don't think we can expect anything so ruthless this time.

Even though the forum won't achieve anything concrete, there's plenty ACCA would like to consider as the gathered dignitaries mull over the rebuilding of the world economy.

Perhaps the issue where we may see some actual action at Davos is the separation of retail and investment banking. Following President Obama's proposals last week on this very topic, the president of the European Central Bank, Jean-Claude Trichet offered some support for Obama's position. President Sarkozy will be opening the forum with a major speech on banking reforms.

The nature of the conference prompts some further thoughts for change. To begin with, it is this kind of meeting of leaders from all over the world to discuss globally co-ordinated change that is necessary. Davos, being rather unfocused, is not necessarily the most appropriate place to achieve real change, which is why we need a permanent secretariat for the G20 by 2020 to properly organise effective global action. Besides this, despite the sheer size of the forum and the energy required to run it, I hope the gathered leaders don't forget the needs of the multitude of small businesses or the importance of low carbon economies.

For more on what changes in the global economy ACCA wants by 2020, check out our paper on the topic here. In the meantime, keep up with our coverage of Davos on Twitter at www.Twitter.com/accanews.

How can we help more women succeed as entrepreneurs?

A new all-party group of MPs has today been launched in order to examine the obstacles that currently stand in the way of more women becoming entrepreneurs. The group will consult with experts from business, academia, government and think tanks and will bring forward concrete recommendations for progress.

ACCA will act as the secretariat to the group.

Lorely Burt MP is the chair of the Women and Enterprise Group: 'Women make up 51% of the UK population and 47% of those active in the labour market, but they are seriously under represented in setting up small businesses. Only 15% of UK businesses are owned by women. This is something that needs to change.'

Meg Munn MP, vice chair, added: 'This group aims to highlight the issues that prevent more women from becoming entrepreneurs and to start proposing solutions. We’ll also be looking at best practice from other countries around the world - for example, if the UK matched US levels of female entrepreneurship, there would be 900,000 more businesses in the UK.'

Helen Brand, ACCA chief executive, said: 'ACCA is proud to be acting as secretariat for this group. Its aims are very much in line with our core values of opportunity and access, and we look forward to supporting the group in its future work programme,  which will be examining key issues including access to finance for women and the importance of diversity of supply.”

To be added to the circulation list, or for more information on the group, please contact: Veena Hudson, Secretariat to the Women in Enterprise Group, ACCA, Head of Public Affairs.
Email: Veena.Hudson@accaglobal.com
Telephone: 020 7059 5615

Will we see the first web election?

There's an interesting article in PR Week, 'Will we see the first web election?', with opinion divided on the importance of social media to the main political parties.
 
I'm intrigued by this because having run for Parliament myself in 2005, when the good people of York simply weren't ready for my DVD and email-based campaign. I didn't do badly, but there are no prizes for coming second in British politics.
 
While ACCA continues to respond, develop and invest in the dialogue members, students and the media are having with us on Twitter, LinkedIn and Facebook, the UK is not prepared for an Obama-style social media campaign.
 
For a start it is too late to begin a thorough campaign. Obama's team started two year's out. The UK election is less than four months away. Most of those registered to vote, and motivated to vote – I'm thinking mostly silver surfers – are unlikely to be swayed in their voting intentions by the kind of techniques social media is best at.
 
Generation X electors probably won't vote. One only has to look at the Facebook pages of the Parliamentary candidates to realise that no 18+ year old is going to look them up on Facebook first to see whether their local candidate is worth going to the polling station for.
 
In 2005 I had thought email canvassing would be the way I replaced door knocking – which I detest – as a way of making myself known to the York electorate. It didn't work then and it won't work now, because in order for social media to work both parties already have to be on the same wavelength. Twitter, Facebook or LinkedIn are excellent platforms to communicate specific messages to segmented audiences. That's narrowcasting.
 
The British electorate still favour their election campaigns being broadcast to them. Which is why come 7 May, TV and the newspapers will still be the primary media that the political parties use to try and drag us to the polling station.

Nice investment fund… What’s it do?

Since 2000, the Department for Business, Innovation & Skills (BIS) has been running a series of Venture Capital Funds for small businesses. On 13 January, the Public Accounts Committee took evidence on the performance of these funds, and it would be fair to say that the Committee members were not entirely happy campers.
 
High up on the list of complaints directed at the witnesses (Simon Fraser, permanent secretary to BIS, and Rory Earley, CEO of the company that manages the funds for the government), was the proportion of investments that ended up in the pockets of individual fund managers.
 
Figures produced by the National Audit Office show that of the money invested in the Regional Venture Capital Funds (the Committee were somewhat loose with their terminology; the actual funds under fire required some checking), 36% ended up as fund manager fees (although only 25% of this came from the taxpayer). According to Richard Bacon (Conservative, the MP, not the DJ), this use of funds was 'unconscionable'; Austin Mitchell (Labour, the MP, not the car) settled on calling the fund managers 'jokers'.
 
Further ire from the Committee was drawn by the report's criticism of the initial set-up of the funds. In 2000, early funds lacked clear aims, transparency, and rate-of-return figures, said the Committee. These failings prompted Committee chair Edward Leigh to accuse the funds of being business 'slush funds' rather than proper venture capital funds. It seems the EU may have had similar concerns over some of the funds, as some funds, but not others, fell foul of state aid laws and required capping at £0.5m
 
As far as the Committee was concerned, things went from bad to… well, also bad, when the performance of the funds was considered. Bacon noted that the average amount invested in each business – £373,000 – was essentially of 'piddling size' and offered little useful help to any growing business. He was also unimpressed that so many investments had been made (a total of 356), which he argued were impossible to oversee properly. Worse, the fact that the Regional Venture Capital Funds (not all the funds, mind) had managed to turn a £74m investment into £5.9m elicited much displeasure from the gathered MPs.
 
On their part, the witnesses had some perfectly valid points. This review, they argued, was taking place after 'only' eight years, when investments of this kind could be expected to mature after around 12 years. Secondly, they noted that the performance of the state funds was not entirely dissimilar to that achieved in the private sector. Responding to the capping of funds by the EU, Fraser and Earley noted that the EU had 'generously' lifted the state contribution cap to £2m.
 
The most important thing though, maintained Fraser and Earley, was that the Department had 'learnt lessons'. They 'fully accept[ed]' that early funds were 'not a total success', but since then transparency, targets, accountability, and taxpayer protection had all improved, they said.
 
As the Committee said however, lessons may have been learnt, but did the Department have to spend so much money to learn them?

Unmistaken natural brilliance

My attention was particularly drawn this morning to the feel-good press coverage report for ACCA Zambia. I confess to always carefully looking out for ACCA Zambia's media coverage as it always appears at the end of our morning news update, and unless one is very careful can easily be overlooked by the more urgent news items that demand immediate attention.
 
However, the words 'Unmistaken natural brilliance' in today's ACCA in the News of course drew my eye instantly. And who would have thought it? An accountancy student, 19-year-old Akamandisa Inambao - and an ACCA student to boot - walks off with the Zambia's Super Model 2009 contest.
 
To quote the Zambia Post: 'Unmistakable natural brilliance coupled with a majestic walk is all that 19-year-old Akamandisa Inambao needed to win the Zambia's Super Model 2009 contest. Akamandisa, an ACCA student at Zambia Centre for Accountancy Studies (ZCAS), hopes to take up accountancy permanently after she hands over the crown.
 
'Akamandisa observes that the ACCA qualification is diverse and globally recognised, saying students upon graduating are guaranteed with employment. She further says that "ACCA is better than other accountancy qualifications in that one can diversify in finance, management or accountancy."'
 
Quite right. Happy Monday, everyone.

Heart and sole

'Sexy' isn't usually a word you would associate with accountants, but this is how Dunkley & Co, a Bristol-based accountancy practice, described themselves in their successful entry for Accountancy Age's 'Sole Practitioner of the Year' award earlier this year.

2009 was the first year that Accountancy Age handed out the 'Sole Practitioner' award, recognition that is a long time in coming.

The accountancy profession's headlines are often dominated by the 'Big Four' firms, but even these famous firms aren't big enough to employ all the 131,500 ACCA members or 362,000 ACCA students.Instead, the vast majority of qualified accountants work in very small firms or, more often, operate as sole practitioners. Sole practitioners, then, lie at the heart of the accountancy profession.

Sole practitioners may be consistently out-gunned by bigger firms in terms of fees they generate, but the work they do is no less important. When it comes to small businesses for example, sole practitioners are often more useful than their larger cousins.

According to the Department for Business, Innovation, and Skills (BIS), small businesses in the UK comprise 99.9% of all UK businesses and 59% of private sector employment, and while there is plenty of business advice available from the Government, the first port of call for small businesses for advice is often their accountant (as found by both BIS and the FSB annual member surveys).

Sole practitioners are uniquely suited to the needs of small businesses. Being a small business themselves, they can completely empathise with the needs and concerns with the businesses that seek their help, while a sole practitioner will have an in-depth knowledge of the local economy that larger firms are unable to provide. Importantly, sole practitioners can develop a closer personal relationship with their clients than larger firms could ever hope to achieve.

Even when sole practitioners don't have the capacity to continue to serve a growing small business, the sole practitioner can be invaluable in referring clients to the most appropriate multi-partner firm.

New sole practitioners are starting out all the time, such as ACCA member Karen Butler, who set up Norfolk based Online Accountancy Services at the end of last year. The site offers a wide range of services, tailored to small businesses, and also demonstrates how the internet can make self-practicing an easier proposition (although self-practicing remains a challenge; help and advice can be found here).

Here's hoping that sole practitioners continue to receive recognition for their hard and important work throughout 2010 and beyond.
 
Happy New Year!