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Is it sensible to be nice in business?

Posted on 12th October 2018 by Chris Makin

Attitude to business has changed quite a bit since I first became an accountant.  For the first 20 years or so of my career I was a general practitioner, acting for all sorts of clients: lots of tax return clients, lots of market traders and small family companies, up to some quite large organisations including a couple of PLCs – and at the time I was a sole practitioner!  In those days, whilst most of my clients were pleasant – even loyal – the general attitude in business was that to be successful one needed to take advantage of others.

I suppose this attitude is encapsulated in the spiv Private Walker from Dad’s Army, or Del Boy from Only Fools and Horses.  And look where it got them! Yet it persists; look at the despicable treatment of patients at Mid-Staffordshire Hospital or Winterbourne View.  The NHS is interesting; its care of my elderly mother during a series of heart attacks has been truly inspiring, yet there are still some in the NHS who think the “service” is run for their benefit, and that we patients are mere supplicants.  It will change; it has to.

How about us, in a service industry such as law or accountancy?  We have to impress and please our clients, particularly in one-off activities such as litigation, since the next new client may be our last.  Going the extra mile has to be second nature; we have to give excellent service, and give the client (your client, or in my case as forensic expert, you the instructing solicitor) more than they have paid for.  And if we do that, not only do we have a happy client, but our clients become advocates; happy clients tell their friends, leading to more work.

So it’s good business to be generous to our paying clients, but I believe we should go further; we should be help people as an end in itself.  And I know that you solicitors agree; look at Law Works the free mediation service for those who can’t pay; look at all the pro bono work you do, and your numerous other activities for the public good.  Such volunteering is very satisfying, but it can also be good business.

To give one example, I am a support member, or ethical counsellor, for chartered accountants facing difficulties.  It may be bereavement, overwork, stress, negligence claims, insolvency, and particularly disciplinary problems.  We support members give free, confidential advice, and because I am the only forensic accountant on the national team, I get the “mucky” stuff: negligence, partnership disputes, regulatory offences and the like.

One such concerned a lady member who had two companies, one replete with cash and the other insolvent.  Through very pressing family commitments – she had a seriously disabled son – she couldn’t go on, so she backed up the computers, locked up the place and wrote to the bank asking them to put in a receiver.  She then took a huge amount of cash out of one of the companies and fled abroad with her son, living in France until the money ran out.  The trouble was that, whilst her director’s loan account was well in credit, that was in the insolvent company, and her loan account in the other company went seriously overdrawn.

Both companies were put into insolvent liquidation by the bank, the liquidator reported matters to BIS, and she faced director disqualification proceedings.  She signed an admission under Carecraft Construction and was disqualified for three years, but was reported to ICAEW, and she faced our Institute’s disciplinary committee.

With ICAEW, the sentencing guideline for CDDA disqualification is exclusion from membership and costs.  I worked at length with the lady, and we compiled a very long letter of mitigation.  The outcome was that she received only a reprimand with no costs.

Job done; end of story.

But it wasn’t.  A few months later, I received instructions from a solicitor in Taunton on an asset recovery defence.  Why did a solicitor in Taunton instruct me, a forensic accountant in Leeds?  Because the lady had recommended me; this was her big thank you.  And it couldn’t have been a better one.

I could think of many other examples of kindnesses being rewarded, and I’m sure you could, too.  I know I’m preaching to the converted, but isn’t it reassuring to know that when we do others a favour, the reward can be more than just a warm feeling that we have done the right thing?

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Chris Makin

By Chris Makin

Chris is a chartered accountant with over 30 years experience as a forensic accountant and expert witness, and 20 years as a mediator and expert determiner.

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