RSS feeds‘IFRS is not a dead issue, quite the opposite, it will be more exciting this year than last,’ says Jon Symonds, CFO of pharmaceutical giant AstraZeneca, as he settles back on to the large green leather sofa in exactly the centre of his office.
The issue of international financial reporting standards has been top of Symonds’ to-do list ever since he took the helm of the influential Hundred Group of Finance Directors two years ago, a post he recently gave up.
The first sign of his strong backing of the new rules came in October 2004 when, in a groundbreaking move, vital to the successful introduction of the new regime, he revealed AstraZeneca’s restated accounts for 2003 and the first half of 2004 under IFRS.
Ever since then he has been an ambassador for the new standards and responded to any calls that undermine the importance of the biggest change accounting has seen in decades.
‘My biggest achievement was putting the Hundred Group firmly on the map as an organisation of influence. Not one you see on the front pages of the papers, but one that is constructive and that wants to work with the government, standard setters, whoever, to influence sensible outcomes. Whether it’s IFRS or tax, we’ve been supportive and vocal on the whole process.’
Thanks to Symonds, IFRS has been successfully pushed to the top of many UK boardroom agendas – an issue that has been challenging but also one that he has doggedly pursued over the past two years.
‘The challenge we’ve had is the recognition of something like IFRS. No matter how well organised the UK is, it’s just one of 70 countries applying IFRS so how does it carry the message on? The preparers are now organised, the International Accounting Standards Board has seized that and has regular sessions on IFRS, so we’ve managed to introduce a robust discussion about the issues and where to go next.’
The UK’s first-ever restatement of figures under IFRS marked the beginning of a series of highs and one particular high-profile low for Symonds. As well as influencing the debate on pensions and accounting, the high point, he says, came at the tail end of 2005 when the Hundred Group stepped out of the shadows and announced it had signed a £5m cheque to fund the long-planned Oxford University business tax research centre.
The plans for the centre were hatched by Symonds and his close friend Christopher Wales, managing director of the financing group at Goldman Sachs, with the launch last November. Symonds has high hopes for it, with the main aim to look at taxation policies and policy options and carry out some heavyweight academic research to improve Britain’s global competitiveness.
‘Whether it’s IFRS where we’ve been supportive of the whole process, tax competitiveness, the establishment of the Oxford tax research centre, the engagement we’ve had on pensions and the influence we’ve brought to bear on the pensions proposals 18 months ago, we’ve done a lot.’
However, he adds that the way the group has carried out its work has retained its air of subtlety, only acting and commenting when necessary. ‘We’ve done it in a constructive way without dramatic headlines. There have been one or two, but they haven’t been deliberate and most have been positive.’
The low, although Symonds refuses to accept it as such, came last July when it was thought he might leave his position at AstraZeneca after failing to land the company’s top job as CEO to replace Tom McKillop. Symonds admits he went for the job, but was pipped to the post by the ‘better man’, David Brennan, who took over on 1 January 2006.
‘Whatever happened is clear and that’s the outcome. David started on 1 January and he’s a good guy. It’s not like you have to fill in an application form,’ says Symonds visibly defensive in responding to the question.
‘The board has an obligation to manage succession and clearly knows all the internal candidates and talks to us all about future career prospects. They had a structured process, considered internal and external candidates and David was appointed.
‘Six months on, the wheres and what fors don’t matter, the fact is David is the CEO. It’s our responsibility to back him. AstraZeneca has got to be bigger than any individual and we’ve got a great team here.’
When asked whether he would consider leaving because he didn’t manage to secure the top spot, Symonds is more vague but says that his continuing mission is to back the company that he has served so well, although his disliking of negative media attention within the pharmaceutical sector is clear.
‘No one talks about their future career choices. I want AstraZeneca to succeed, I’ve put my heart and soul into this company for eight years and I’m as passionate about it today as I’ve ever been.
‘I want to play as big a part as I can. We’re the fifth largest company in the UK in a fantastic industry that, despite some of the press, is geared towards improving the quality of human health. That is about as good a reason to get up in the morning and come to work as you’ll find.’
He says he will greatly miss McKillop, an executive who has often reaped praise from his peers. ‘Working with Tom has been fantastic, he’s one of the best CEO’s in Europe and we’ve been through a lot together. The company is probably three times bigger than when I joined it.’
But what he’ll miss most is chairing the Hundred Group, although he admits that two years ‘is enough’ and that running AstraZeneca’s finances will now take up most of his time. ‘I’ve enjoyed it a lot more than I thought I would. It’s been a pretty exciting period to lead the group through more challenges than there has been at any other time.
‘There have been so many issues, but the biggest challenge has been prioritising. The Hundred group relies on CFOs, not on a secretariat, and we haven’t got an administrative function so none of us has a great deal of free time to spend on anything outside of our companies, so the important thing has really been prioritising among a number of issues. I have to say, having done so, the support we get from CFOs has been tremendous.’
Symonds has brought the group from relative obscurity to a well-known force that is able to firmly voice its feelings on the core issues that matter to the heart of British big business – and to make other key business leaders and organisations stand up, take notice and react.
‘Over the past year I’ve had more CFOs turning up for quarterly events than ever,’ he says proudly. ‘We have a completely reconstituted committee and from our surveys we’re getting between half and two thirds of companies responding so our impact has been significant. This is because we’re focusing on issues that are on CFOs’ day-to-day agendas.’
After standing down from the chairmanship at the end of November and passing the mantle to the CFO of insurance company Prudential, Philip Broadley, Symonds is confident that he has left the body in good hands.
‘The organisation is being left in pretty good heart. Philip has been on the main committee for almost as long as I have, and he’s been deputy for a year so he won’t need any specific advice. It should be a fairly seamless transition where he will be able to make his mark.’
Despite Symonds’ departure from the limelight, the business world will continue to benefit from his opinions on issues that concern not just AstraZeneca, but UK plc as a whole. Symonds is a bit like IFRS – he is far from over.
SPEAKING OUT
Symonds on international financial reporting standards: ‘I don’t want a technical and theoretical approachto undermine communication between business and owners.’
Symonds on the growing pensions crisis: ‘Pensions will dominate the headlines thisyear. Corporates have shifted their position because most of the big schemes have changed. I don’t see why companies should take the full burden. There’s a role for government, and there’s a role for individuals and companies.’
Symonds on Gordon Brown’s decision to scrap the operating and financial review: ‘I was very surprised as I thought the OFR was largely regarded as a sensible way to improve the quality of communication between a company and its stakeholders. I’m not quite sure I understand what the rationale behind this is.’
Symonds on publishing the UK’s and AstraZeneca’s first set of restated IFRS results for 2003 and 2004: ‘I have always wanted to inform the market of things that are important. My views on that are the same no matter which hat I have on.’
Symonds on the launch of the Oxford University business tax research centre: ‘In an increasingly competitive international environment, it is essential to explore new policy options and carry out a rigorous analysis of their implications for business, the tax yield andthe economy.’
Symonds on Charlie McCreevy, EC internal market commissioner: ‘I’d be interested in finding out where he is now because his views have tended to shift a bit.’
