How the profession won back trust in the Netherlands

“It's rather a long story,” says Berry Wammes, CEO of Nederlandse Beroepsorganisatie van Accountants (NBA), about the seven-year journey the profession has been on to build back public trust after it took a nose-dive in the aftermath of several Carillion-style collapses. 

The Dutch profession has been rather successful in its endeavours to restore trust and implement reform. “We try to cooperate with parties where we didn't necessarily have the same interest and we tried to develop relations,” says Wammes. “It was about collaboration.” 

In spring 2014, as a result of these scandals, the Dutch parliament conducted a debate on accountancy and audit. There was a lot of anger: the view was that the profession was motivated by profits alone, to the detriment of their duties. “It was front-page news. The Minister of Finance at that time said: 'this has to stop'.”

During a public Finance Committee meeting, the Minister of Finance addressed attendees from the profession and told them they had five months to come up with a reform plan. “You reform your profession or we will do it for you.”

The firms and the NBA put together a team of seven people, all young professionals, to come up with a reform plan. They came up with 53 measures and in the Autumn of 2014, they were accepted by the profession and parliament. Some of them were transferred into legislation, with a period of three or four years to implement.

Several monitoring groups were put together to keep track of progress, both inside the profession and from the Dutch regulator. The regulator produced reports that reviewed the progress and identified areas where it wasn’t sufficient. 

“Two years ago, we had about 100 people working on audit reform; representatives of the firms together with people from the professional body, in six or seven project teams working on several issues,” Wammes says. 

The process has been long and is ongoing. Last year, the Dutch parliament held another debate on the profession’s progress. The conclusion was that the profession was making progress but work still needed to be done. No firm measures were taken but instead, the government allocated two people to a special three-year assignment to monitor the efforts of the profession and report frequently to the finance minister. 

“At the moment, we have a steering group made up of responsible people from the firms, their heads of audit, combined with the president of the professional body,” says Wammes. “The steering group is responsible for the work of large project groups, looking at areas like fraud, continuity, culture, the future of the audit.” 

The NBA steering group meets with them at regular intervals, updating them on progress and taking on board their feedback. This is an extensive programme, Wammes explains. On fraud, for example, the NBA has 19 projects running.

“What you see is a new model where we collaborate with all kinds of stakeholders,” he says. “We have different stakeholder groups and we develop the programmes together with them. It’s so different from five or six years ago. At the time, the profession was quite isolated and nobody really understood it. 

“But now we have created a kind of ecosystem where different interest groups and stakeholder groups are working together with the profession. Trust in the profession has improved. It's not quite where it should be, but compared to five or six years ago, it has improved a lot.” 

Further reading:

• Accountancy Europe: toughen the financial reporting ecosystem against fraud
• Tackling corporate fraud in the Middle East
• Business rescue: Hong Kong still waiting for a moratorium mechanism