Business conduct   MBAs will hold responsible positions in many businesses of various size and complexity.  They will be applying their specialist skills and knowledge to an ever changing set of challenges.   Yet MBA qualifications have not always had a good PR recognition, and indeed the worst excesses of MBA behaviour have led to accusations of being a main contributory factor in the demise of large companies ( e.g Enron)  Entrepreneurial MBAs who have started companies from scratch do begrudgingly get a better recognition for their hard work.   Is this general suspicion of MBA qualifications are own fault, or is this a criticism of business generally and MBA criticism is collateral damage?  For me there are several areas in which MBAs can help.  Corporate Social responsibility should be more than doing the minimum that business can get away with and, indeed , MBAs have been taught that there is a moral duty to expect higher standards of business than this. Even small businesses with perhaps fewer resources can ‘ behave ‘ better in the wider environment . We at AMBA like to stress that sustainability and ethical behaviour extends throughout core curriculum and expect these concepts to remain within the MBA mindset throughout the working life.  Philosophically, a ‘good’ citizen is not just compliant with local statutes and there is no law that says ‘corporate citizens’ are exempt from this idea.  When we get to corporate citizens we get into areas like taxation , and taxation is not merely a legal or technical issue and a ‘cost’ to the business but rather a moral issue about that business position in the wider economic and national/international environment in which it operates.  This is an example of ultimately pursuing shareholder value to its extreme without recognising the ‘cost ‘ to society at large and the contribution that taxation revenues make to the wider community. Nowadays society is recognising that tax avoidance can cause reputational damage, so again we come back to sustainability and the issue regarding loss of business through behaviour.  Going back to the larger corporate collapses and MBA involvement, there is no excuse for ‘collaborative silence’ on these matters which are ultimately moral and are concerned with our wider society. I would hope that, if this resonates with current MBA teaching, these issue become agenda items which drive behaviour.     When you are sitting through a finance lecture of following up a CPD course on finance then you may look a different holistic approach to finance and cost/benefit analyses that this sort of thinking brings.  If you realise that the planet is a zero sum profitability model then we may avoid worst excesses of corporate capitalism. 

ntroductionAs a Franchisor , branding is important to us, not so much as a logo or trademark, but at an SMElevel it is more about having a certain standard of franchisee that won’t bring the Franchise intodisrepute, so we are more aware of ‘brand’protection than most. Our Franchise agreement hasterms which incorporate standards of behaviour and doing business in a certain way with sanctionsin place if a Franchisee misbehaves. Therefore , whilst we cannot attempt to have the brandrecognition ofsay Uber, Google or Coca Cola, we do have our own reputation and that of ourindividual Franchisees to protectHow much of a brand’s value can be captured on the balance sheet?This is mainly an intangible asset and from an SME perspective it is moreto do with Brandmanagement than valuation. The value of the Brand to us is about service delivery and havingprocesses and people in place to deliver what we say we deliver as a Franchisor .The human side of the relations with our Franchisees cannot beunderestimated and we spend a lotof time energy and cost in keeping in regular contact with our Franchisees both digitally and face toface. Therefore we can have some valuation in our assets such as websites and digital interfacecosts, but the true value is in our people which we can’t put a price on.Larger organisations and better known brands maybe able to put a value on them using lifetimeincome generation ( NPV models) oramount spent on marketing , but it is a brave organisation thatwants to capitalise these costs onto the balance sheet , especially with the advent of social mediaand the commoditisation of opinion that means a brand’s value can be wiped out overnight.My own personal view is reliance on asset valuations of a brand can only mean too much emphasison shareholder value and dubious accounting concepts rather than a hard nosed approach to thetrue worth of the brand, especially when there are charismatic founders involved .The growth of Unicorn companies is a case in point with noreal tangible assets but rather a digitalplatform that has created shareholder value more out of hope and hype than anything solid. ( e.gUber)What are the accounting and reporting rules associated with brand valuations?The principlesdepend on whatvaluation method is used either cost based, income based or marketvalue. Either way I personally am not comfortable about any of these methods at an SME level. ,especially when we have covenants for balance sheet values which support substantial borrowings,My one thought is who are you trying to kid, and why would you want to value the brand in the firstplace?Do finance directors of smaller firms understand brand value and how it can be leveraged?yes, , from aFinance perspective it would be a verybrave FD who tried to borrow against a brandvalue ( see above) . However, FD’s recognise the importance of a marketing and sales perspectiveon brand recognition and there will have been infrastructures put in place which support thestrategic intent andbrand protection. Boards of Directors will manage risk from a brand orreputation perspective whilst also concerned about the sustainability of the business which is relianton it’s tacit knowledge, brand management and , in short., the way things are done.If an FD wants to leverage the Brand and help the business grow then placing a value on the brand isbetter done by getting the stakeholder ( e.g. a bank or funds provider) in front of thesales/marketing team and understanding the message and understanding how vital the logo,mission statement and brand awareness is in comparison to the actual service/product delivery. An FD may also want to ensure that there are surveys or focus group feedback studies which may ‘ add value’ to the brand but not in atangible sense. At an SME level the brand and the Board are muchmore in tune with each other.How can smaller firms protect their brand equity?Apart from the usual IP issues and registering trademarks etc, the acid test is to dowhat it says onthe tin, period.How do firms determine whether they should use income-based, market-based or cost-basedevaluations?I personally think all these issues are flawed and a firm must have a good reason to want to valuethe Brand. In olden days this was called ‘Goodwill’and only really manifested itself in a sale of thebusiness which is the ultimate test of what someone is prepared to buy the business for, so the truevalue of a brand is only what the marketis prepared topay. I can’t think of a really good valuationmethod that would stack up and be enduring knowing the uncertaintywe face in the market placeand the threat of new entrants and the disruption of business models via technology which wouldmean Ipersonallywould havelittleconfidence in puttinga brand value on the balance sheet.If you look at surveys of business confidence the new normal appears to be that we are dealing withmore uncertainty than ever, the pace of business and the pace of change is faster than ever, sobrand valuations are probably too subjective to mean anything.You might as well try and put a value on ‘sustainability’ which , if you were a BHS director, mayactually be negative.

Agendas are generally about information, which is in turn driven by expectation,  growth, innovation and notions of sustainability   Agendas are also influenced by the externalities to the Business such as how they are perceived to be governed and the regulatory constraints on them as well as responding to Stakeholder expectations  Other drivers of Agenda are  managerial desires to control the  internal business processes rather than report the externalities.  So who is driving the Accountancy agenda?, is this a classic example of the dichotomy between top down and bottom up approaches, or are we talking about different levels of Accounting information and that there may be information at Board level which philosophically is different from information at operational, level and is there a mis- match in the organisation that highlights this dual process, or in fact are is this information perfectly consistent?  Is the underlying assumption that the leaders of the business are the ones that are determining the business aims and objectives at every level and have we taken an unbiased view of these and ensured that they best serve the business in pursuit of the vision? And if the vision changes, how swiftly can we introduce new Accountancy based information to support the vision?   Does this all depend on what Accounting systems we have in place and that measures like staff wellbeing or institutional well being actually are aligned with the overall purpose of shareholder value creation?  As we all come under increasing pressure to change due to economic circumstances, globalisation or indeed technological changes , are we keeping tabs on the reports we produce and  why we want to measure performance and the fact that we are in a continual dynamic state which means continual revision of accounting output and keeping a weather eye on the externalities.  In view of this, what accounting systems do we have that  puts in review processes that ensures the  current information is fit for purpose and that the Agenda is properly accounted (for)? 

The issue here is that people appreciate beauty and respond more positively when things ‘look right’  Without exposure to beauty, people don’t feel right, information doesn’t feel right and so therefore decisions made or conclusions drawn leave the user with a sense of unease. If things don’t look right there is a depression of spirit and an unnecessary compromise by the receiver of the information that means they have to work harder to accept ugly truth.  This can manifest itself in all kinds of strange reactions to the information produced ranging from destructive criticism of the author – they can’t produce a ‘decent report’ to straightforward denial of the information that is put in front of them- that number is wrong.  An experience of beauty is a two way process, firstly there is the objective reality of the author- an underlying desire to ‘tell the truth’, however unpalatable that may be, and a subjective receptivity of only wanting to hear good news or indeed only interested in a small part of the information to suit their own needs or reinforce existing beliefs   As in most forms of accounting there is a balance to be struck and an attempt made to find the balance in the accounting information that appeals to a universal truth of the author and the user.   What the accountant wants to produce should be the result of a perfectly formed and well trusted process by which numbers are assimilated. What the user sees in the accounting information is a view of the world and, hopefully, an aesthetically pleasing set of numbers that make sense. What is then required is a more active interaction with these numbers that is equally pleasing.  So again we are faced with a trade- off, on the one hand to get an aesthetically ‘right’ document may take time which the occasion may not have, the report may have been wanted by yesterday and so there is no luxury time available to dot  and cross the document. Nevertheless the information, although imperfect, may be fit for purpose.  This is what Soccer managers say when they say ‘winning ugly’ the performance of the team may not be great but the overall result was a win (desired outcome), it is the same with accounting information. Provided the desired outcome is achieved, the style, content and layout may have to be compromised for a variety of reasons.   Aesthetic accounting is about hitting the right balance with the resources available to get the perfect message across, even if it means imperfect information, again it is part of the accountants ability to compromise his own view of aesthetic beauty and maybe not get too involved in the aesthetics of process, provided that the end result is good enough not to spread dis-ease in the eyes of the beholder.   Accountants will recognise this dilemma if they have read many CEOs reports in support of financial information and may have taken exception to the way the information has been interpreted by the CEO. What is happening here is the CEO living in another aesthetic existence and wanting everything to be perfect, so the issue here is not to get too upset about perceived and subjective use of information provided the end result is aesthetically pleasing. This doesn’t mean the form , layout and content of accounting information has to be a work of Art, it means that the ultimate decision of action on which the information is based is a ‘universal truth’ ( in the sense that the immediate stakeholders involved in the action/decision have a consistent view on what constitutes ‘ truth and or beauty’ )  I suppose the message here is to find the balance between getting the message across and a communication style that works for everyone. So somewhere along the line compromises have to be made and that notions of beauty or ugliness are subjective issues based on circumstance. A beautiful football game may not produce a beautiful result, so winning ugly is always an alternative, but the beauty of winning the league in that year may compensate for ugliness along the way.