Damian Wild

‘The far end of a fart’ was where Sir John Harvey-Jones once said accountants were prepared to go in their efforts to make the accounting system measurable.

He was speaking in the wake of Enron et al, but, as with so much of what he had to say about business, he was on they money when it came to identifying the shortcomings of many senior finance people.

‘They go to extreme lengths on what is easily measurable, but make no
efforts on things that are absolutely crucial to the future of the company ­ for example, valuing the opinion your customers have of you,’ he said.

‘The accountant really has to give a full and fair view of every position. Otherwise he’s failing in his duty.’

I had met Sir John a few years earlier and even then he clearly wasn’t a man to suffer fools ­ or finance directors for that matter ­ gladly. But he had foresight, that’s for sure.

‘I guess that within a couple of years’ time, at the present rate of progress, everyone will know the financial position of the company at every level in real time,’ he said. He didn’t quite get the timing right, but that remains the direction of travel.

And he may have blamed FDs for not making it happen sooner. After all, he had warned: ‘FDs could be the key gatekeepers making that happen or they could be the abominable snowman preventing that from happening.’

A good FD, said Sir John, must be able to measure innovation, reinforce everything that is working well within a company and be willing and able to cut out all that is not. And quickly. But, again he warned, FDs who were going to have a lasting impact on their business must do more.

They must, he said, be visionaries and persuasive ones at that. ‘In the finance function it’s all about risk. And if you don’t take risks, that’s the most dangerous position of all. It almost doesn’t matter what you do as long as you are constantly trying something new.’

The next generation, he said, would have to change. ‘They have got to have a dream of where they might be in future. It’s not that they might have a 20% chance of becoming chief executive, it’s that they have a 60-70% chance of
being the main agent for change in the business in which they work.
That ought to be the ambition of the young accountant.’

Damian Wild is editor in chief of
Accountancy Age