Philip Nicol-Gent was appointed as lay chair of the IRB in January this year. He is a founder member of the board, and served as its vice-chair from 2017 to 2022. As well as bringing a clear understanding of the role and functioning of the board, he also has a wealth and breadth of experience in the regulatory sphere, and a keen eye for staying at the forefront of change.
“We’re at a pivotal moment, not just for the IRB but for ICAEW itself,” he explains. “We all recognise there’s a changing regulatory landscape, and the direction of travel is towards greater specialisation and independence,” he says. “So it’s particularly important people understand that the board acts independently.”
“We need to ensure people know what we do and how we do it,” he adds. “As a maturing board, we now have to find our voice. We act in the public interest and without a strong voice it is harder to do that, which is partly how misperceptions about how we regulate can arise.”
Continuity and change
A highly experienced lawyer, Nicol-Gent was called to the Bar of England and Wales in 1991, and later the Guernsey Bar in 2003 after a period studying at the University of Caen, Normandy. In Guernsey, he acted for both the government and the Guernsey Financial Services Commission. During the banking crisis of 2008 he was involved in the administration of Landsbanki Guernsey, the first administration anywhere in the world of an Icelandic bank.
In 2011, he moved to work directly for the Guernsey Financial Services Commission, first as Regulatory Director and later as General Counsel. Currently, he works for the Commission on a part-time basis as a Senior Counsel.
“By profession, I’m a barrister,” he explains. “But I have more than 20 years of experience in the regulatory field, and a good 10 plus years’ experience of frontline regulation.” He applied to join the IRB in 2016 when it was first established.
The following year, he was appointed vice-chair, a post he held until becoming chair in January. With the board firmly established, he believes now is the time to take the next steps; not only to counter common misperceptions about the regulatory framework, but also to find out more about how those on the ground view the regulatory system in which they operate and what issues they face.
“To do that, we need to get out there and have conversations,” he says. “I want to be a chair who engages and I believe that’s an important role for the chair. We need to be engaging and talking to people, and listening too, which is arguably even more important.”
One way of doing this, he believes, is to take the IRB out on the road. “We’re planning to get out there and talk to people,” he says. “So, for example, we’re going to hold at least one board meeting a year outside London.”
“I also want to talk to and engage with the district societies,” he explains. “I want to hear from them and find out what they see from the chartered accountant side. I also want to talk to, and hear from, local Chambers of Commerce because their members are probably the largest consumer of accountancy services.”
“We can't do it all in the first year,” he acknowledges, “but we want to try and get around the country, talking to different district societies. When you look at the profile of ICAEW member firms, it isn’t all about the Big Four. Small firms or sole practitioners are equally part of this.”
An improvement regulator
Nicol-Gent is also committed to further promoting ICAEW as an improvement regulator. One of the problems with regulation, he believes, is that most people mainly see the bad practice, because that’s what ends up before the committees and makes the newspapers.
“What we tend to see less of,” he suggests, “is all the saves the regulator is making behind the scenes; the long list of things where the Professional Standards Department (PSD) has helped out, or ensured that an accountancy firm has improved.”
“We need to be even more visible in our role as an improvement regulator,” he argues. ICAEW is already, for example, consulting on proposed changes to its Continuing Professional Development (CPD) Policy. And part of the rationale for this is the increased expectation from oversight regulators that professional bodies require members to provide more tangible evidence that they are staying up-to-date with technical and other issues in their field.
In the past year, ICAEW has been particularly active in educating firms about their anti-money laundering (AML) obligations. As chair of the AML Project Board, a subcommittee of the IRB, this work is close to Nicol-Gent’s heart. With his background at the Guernsey Financial Services Commission, he has significant expertise in AML and countering terrorist financing.
The AML Project Board has asked PSD to focus on enhancing firms’ understanding of AML risk. This has involved significant work to raise awareness and communicate with firms. To complement its quarterly AML Essentials and Risk Bulletins, during 2021/22 PSD developed AML bites (a suite of short format videos focusing on key topics), as well as a series of AML webinars covering issues such as customer due diligence and risk assessments.
A recent highlight was the launch of ICAEW’s educational AML drama All Too Familiar. Produced in tandem with HMRC, the film is the third in a wider series of films covering key issues facing the accountancy sector. “This is an excellent example of our work as an improvement regulator,” says Nicol-Gent. “And it shows how collaboration and partnerships can help amplify the regulator’s message.”
Ahead of the curve
Nicol-Gent is also acutely aware of the need for the IRB to keep ahead of new developments. He has already introduced a “left field” standing item on the agenda for each board meeting. “If there's an issue out there we think is going to have an impact, then we need to discuss it around the table,” he explains.
“It’s about horizon scanning and knowing what the issues are,” he adds. A current example might be pressure on individuals and businesses from the “cost of living” crisis. “We need to be thinking: How's that possibly going to affect professionals’ behaviour?” he says.
“I want us to get to the point where we're ahead of the curve; having the relevant and necessary conversations so that government, policy makers and other regulators stop and say: ‘Let's ask the IRB what they think; what’s their view on that?’.”
Staying with this theme, he believes one the IRB’s key achievements in the past 12 months has been its responses to two crucial government consultations: first, to the Department for Business, Energy and Industrial Strategy’s White Paper on corporate governance and audit reform; and second, to the Insolvency Service’s consultation on the future of insolvency regulation.
“We did these responses independently as the IRB, separate to ICAEW as a membership body,” he stresses, “because the consultations focused on key matters of regulation and it was important that the IRB's perspective was understood. It was also a further step towards developing the board's voice"
Being a professional
One of Nicol-Gent’s personal goals as chair is to do more to promote leadership in all its forms. This isn’t just about the regulator itself providing leadership; it’s also about leadership within the firms that ICAEW regulates.
“ICAEW’s Code of Ethics requires chartered accountants to act in the public interest beyond the needs of individual clients or employers,” he says. “And this takes not just training but also leadership. Firms’ leaders need to remind themselves and their staff of what it means to be a professional, and the fact that the public interest always comes first.”
“There can be a tendency sometimes,” he suggests, “to think: well, it's legal, we can do it. But I want to remind professionals that they need to ask not just is it legal, but is it right and should we be doing it? It's a very important point because that's what makes you a professional, and why we, as a society, hold professionals to a higher standard.”
“It’s not for the IRB to tell firms how to run their commercial businesses,” he emphasises. “But we can encourage them to show leadership: to take responsibility for the actions of junior staff, to ask the difficult questions about the sort of business they want be, and the clients they are prepared to act for.”
The next few months will see four new members join the board. Nicol-Gent is looking forward to working with them and current members to lead the IRB through the next phase of its development.
“Our primary role will continue to be to enforce the good standards under the Disciplinary Bye-laws and Code of Ethics,” he says. “But our evolving role is to inform ourselves about the changing economic and regulatory landscape and to speak knowledgeably about that, so we can make sure the public interest is represented and upheld as changes across the accountancy sector unfold.”
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