As M&A booms, Jon Moulton says now is the time for the Corporate Finance Faculty to extend its influence and reach even further

Regular readers of my output – a tiny but much appreciated group – as well as even occasional readers, will be fully aware of my willingness to criticise things. But, for once, I am just going to remind all of us of some of the good things we have.

Perhaps, above all, we should be grateful for a system of government that generates an ever-greater mass of regulation and legislation. That ensures an ever-greater knowledge of ever-more material, meaning we can command good compensation for our wits and our endless education and re-education, as we help clients to navigate the pitfalls that constantly spring into existence.

A collective voice

This ever-growing collection of knowledge and experience resulted in a need for a professional body that provides a centre of excellence and a voice for the industry. This grew from the development in the accounting profession of specialists in M&A, starting in the late 1970s and growing stronger ever since. I was a manager in one of the earliest units in corporate finance in 1979 – the technical base was tiny compared with the world today, but the job was rewarding. Blessedly, it remains interesting and testing for those in the industry.

The Corporate Finance Faculty provides strong representation for its members, many of whom come from outside the accounting world, which adds very welcome specialist skills. There is strong membership momentum, with more than 30,000 chartered accountants working in our field. For the big accountancy firms, transactional work is their third biggest fee generator behind audit and tax.

The faculty has a board of exceptional quality, with a great deal of the industry represented at CEO level. Meetings are effective and well attended – I know because I join them and you know I would say otherwise were it not true.

Our highly capable and hard-working executive team is kept busy responding to (regrettably endless) governmental proposals, which requires the rapid marshalling of members with the necessary expertise to respond sensibly and quickly. Much rubbish never gets to the statute book because of our interventions and lobbying. Typically, some form of consultation needs a response every month, often more. You genuinely would be startled at the volumes.

Politically positive

In the past year, examples include a huge effort on the National Security and Investment Act, where intense interventions at ministerial and parliamentary levels succeeded in making the proposals much more practical in their scope and application.

The faculty has built strong and constructive links with the Houses of Parliament, as well as government departments. This is a continuous effort given the routine changes in ministers and civil servants. We also clearly influenced Lord Hill’s review on listed companies. The work on access to finance impressed, too, where huge efforts produced very useful material, affecting the design and operation of government schemes, which multiplied during the pandemic.

The Business Finance Guide publication is widely acclaimed. The Corporate Finance qualification is valuable and well run. The faculty provides excellent and up-to-date technical guidelines of very high quality. For example, the imminent release of a comprehensive guide on public-to-privates comes at a very opportune moment. It also produces this magazine, which, in my view, is a far better and more useful read than other specialist publications. Its printed format remains popular and was especially welcomed during the lockdowns.

As business gets back to some normality, and M&A demonstrates its ability to drive growth and innovation, proposed restructuring at ICAEW is both a threat and an opportunity for the faculty, which richly deserves an important seat at the top table. At the time of writing, it appears the faculty is being de-emphasised. This is totally in the wrong direction. It deserves to be given greater access to funding and higher priority to keep pace with the needs of members – many of whom are not accountants – throughout the world. We have, and should want to keep, a great organisation.

About the author

Jon Moulton is a CF and a Fellow of the Institute for Turnaround Professionals. Jon has long experience of turnarounds, having invested in them for 30 years and with considerable success. Jon is currently Chairman of FinnCap, the major AIM broker, The International Stock Exchange and Anti-Microbial Research Limited. He also chairs the Better Capital funds and Greensphere, an alternative energy infrastructure fund.

He regularly writes, broadcasts and speaks on corporate finance and financial matters. Jon is also a Director of the think tank The Centre for Policy Studies and an Honorary Fellow of University College London.