The United Kingdom requires all Limited Companies to file annual accounts which are subject to public record. Anyone can access this information. A huge benefit to customers, it provides credentials that can help trade. Most countries do not require this level of accounting transparency.
Despite this visibility, there are continuity issues. Over a multi decade period there are challenges tracking individual company filings. Companies have a few reasonable reasons for not disclosing all their transaction details. They move things off shore. They sometimes spin out valuable entities prior to dissolving their businesses, and they internationalise their transactions, sometimes to avoid tax; in some infamous cases some just ‘off-shore’ their spouses to Monaco to hide their assets. Nominee companies and legal firms often migrate businesses from one set of owners to another.
Companies House does not require proof of identity or name and this can add some confusion to records. Traceability and governance would be markedly improved by linking every business to Director identity checks along with a ‘marque of quality’ that could be graded to indicate compliance with anti-slavery, environmental credentials, tax payments in the UK, bank account, key brands and web sites.
We need an authenticity marque or icon that companies could add to websites, products, branding and marketing if their accounts were particularly credible, linked to tax transparency, clearly associated with directors’ identities, tested by the registrar for environmental and anti-slavery credentials, perhaps even recommended by customers. Such an authenticity marque might become desired by international businesses. It is feasible that the value to customers of this marque would attract businesses to file in the UK. Imagine that!
Honesty does have a value. Integrity is a business currency. Perhaps such an ‘integrity marque’ managed by the Companies House registrar might help us all navigate evolving spin and deteriorating business ethics. It might just help to raise standards of behaviour across the board.
Peter Arnold – Northumbria University
“Peter Arnold is visiting professor at Northumbria University with over thirty years experience pursuing innovation and launching new products and start-ups for large and small businesses all over the world, and has created a Nation-wide review of innovation published in 2021 (Innovation of a Nation).”