No accounting for people is a victory for the accountants

‘I would like to take this opportunity to thank the staff for all their hard work’. This is all we’ll still find in an average company report about that most important asset: people.

The inclusion of simple data, such as how many people are employed, how many joined, how many left, profit per employee and so on, would all have been straightforward measures giving a better insight into the quality of an organisation’s people and their management. But it is not to be.

In the draft of the forthcoming company reporting regulations, the only requirements to report on human capital will be where people represent a risk and liability – nowhere will they be recognised as an asset. Which points to where, I think, the battle was lost.

Although last week’s headline -‘HR sidelined as Government ignores importance of people measurement’ – is true, my slant is that this has nothing to do with government. That’s because the new regulations (issued by the Accounting Standards Board) represent a victory for the accountants, and a defeat for HR.

The accountants are represented by several bodies with, most significantly, the technicians and public sector separately represented. But the amorphous CIPD claims to represent all HR people – in both public and private sectors – and its 120,000 membership is dominated by the equivalent of accounting technicians.

So, rather than seeing an ever-enlarging CIPD, is it time that we looked to a separation of the genuinely senior and genuinely strategic HR practitioners from the day-to-day, process-orientated administrative ranks instead?

It’s all a question of clout, and you can’t help being surprised that the accountants won the day, again.

By Simon Howard, chairman, Work Communications, and columnist, Sunday Times

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