“[W]e have really everything in common with America nowadays, except, of course, language,” Oscar Wilde wrote in The Canterville Ghost.
Of course, that was in 1887, way before Enron, WorldCom, and “Chainsaw” Al Dunlap were around. These days, Americans and Brits differ in more than just the way they talk.
The latest proof: a new survey by transatlantic business group BritishAmerican Business Inc. (BABi) and communications company Peppercom Inc., which reveals some sharply differing viewpoints on business by U.S. and U.K. executives. The BABI questioned 300 of its members — on both sides of the Atlantic — on business issues, including corporate governance.
One finding claims that even after the scandals of 2002, American managers still rate the bottom line higher than a sense of corporate social responsibility. When asked what the main business benefit of good corporate citizenship is, the most common response from U.S. respondents was: “improving brand image.” Another 33 percent or so cited “increase sales.”
This is not to say that the British respondents in the survey don’t think those issues are important. But apparently, they’re happier just to be able to do business. In fact, U.K. executives said the number-one benefit of corporate responsibility was “license to operate.” By contrast, increasing sales came in seventh.
Another difference between U.S. and U.K. respondents was the perception of how clean British books are. U.K. respondents were generally confident that their corporations are not open to scandal; Americans disagreed.
The study also shows a sizeable disconnect (on both sides of the pond) between attitudes and action when it comes to financial integrity. On one hand, respondents in both the U.K. and U.S. showed overwhelming agreement that “ensuring trustworthy financial reporting,” “business ethics,” and “ensuring good governance” are most important for their company.
Nevertheless, the executives don’t seem to be too proactive about advancing those goals. Almost one-fifth of the entire group of respondents said their companies have taken no steps at all to ensure corporate integrity and preparedness for potential exposure.
Only 27 percent claim their corporations are conducting any research to ferret out vulnerable areas; 16 percent have conducted workshops to simulate real crisis scenarios.
The most prevalent step taken? Meetings. “Periodic meeting with senior management,” at 57 percent of responses, is the main way both American and British companies try to make sure their accounting is accurate and forthright.
And, asked whether any company can be really sure that its financial stability is protected, almost 62 percent of the 300 total respondents said “No.”
Edward Moed, managing partner of Peppercom, calls these findings “shocking.” After the havoc financial scandals wrought on U.S. stock markets, he says, “you would think most companies would be really digging deep to understand what vulnerabilities exist and then prepare [for financial crisis] as effectively as possible.”
You’d think so. And apparently, you’d be wrong.
CFOs on the Move
Dan Hale was elected SVP and CFO of The Allstate Corp. He replaces John Carl, who retired in mid 2002 as a result of health-related concerns.
“Dan’s wide experience across a variety of financial services will provide us with a valuable perspective on the successful implementation of our strategy to expand Allstate to become a more broadly based financial services firm,” said Edward Liddy, Allstate’s chairman, president and chief executive officer.
Hale spent more than 20 years with General Electric after joining its corporate finance group in 1966. During this period he spent eight years with GE Capital Corp. before being appointed a managing director with GE’s brokerage company Kidder Peabody Group.