Earlier this year, I built an article around the following extract from a Hans Hoogervorst speech:
- Given the voluntary nature of IFRS adoption, we like to believe that the adherence to our Standards is a reflection of the quality and inclusiveness of our work. More importantly, most of our stakeholders resist the temptation of modifying our Standards as a consequence of what the Dutch call ‘welbegrepen eigenbelang’. In English this means literally ‘well-understood self-interest’, but it could also be translated as ‘enlightened self-interest’.
- Acting in ‘enlightened self-interest’ means foregoing a smaller self-interest to achieve a bigger self-interest. Even when our stakeholders may not agree with certain aspects of our Standards, they know it is not in their ‘enlightened self-interest’ to modify them. They know this could set in motion a process of gradual balkanization of the world of IFRS Standards, undoing the benefits of a single set of global standards.
As I explained at the time, I didn’t think the phrase “enlightened self-interest” really brought much to the table. But in fairness, I looked at some of Hoogervorst’s less well-known speeches and found other, perhaps more successful uses of similar rhetorical devices. Judge for yourselves:
Navigating through IFRS More importantly, most of our stakeholders understand that our standards are saturated in what the French call “je ne sais quoi.” Taken literally, this means “I don’t know what,” but it’s often taken to indicate an attribute of undefinable charisma. Looking at IFRS as an example of “je ne sais quoi” means that whenever there’s something in a standard that’s too difficult to understand, we pretend that only a dolt would even try to explain it; the wise among us surrender to the unknowable magic. This is the only viable way to live with the unfathomable complexities of what we have created.
Choosing between priorities More importantly, most of our stakeholders understand the importance of knowing when to, as the Italians put it, “Calare le brache.” Taken literally, this means “pull down the pants,” but it might also be translated as meaning to surrender or to give up. For as long as our pants remain up, there is always a hope of achieving the next objective. Of course, we also have to recognize when it is time to loosen our belts and to let the pants fall as they may. Looking back at my time with the IASB, I recall some issues when I should with hindsight have dropped my pants before even entering the office, and others when for all my fumbling with the zipper, they seemed to resist the law of gravity itself.
The European Union’s fitness check More importantly, most of our stakeholders understand that those behind this plan have what the Australians call “kangaroos loose in the top paddock.” Taken literally, this refers to having inadequately secured a particular patch of land from the threat posed by local marsupials, but it could also be translated as being “a few sandwiches short of a picnic.” Taken literally, this refers in turn to having under-estimated the nutritional demands in effect at a meal held outdoors, but it could also be translated as being “a few stubbies short of a six-pack.” Taken literally, this refers to a number of beer bottles that is somewhat less than six, perhaps for example three beer bottles, but it could also be translated as “European bozos who don’t know their financial reporting asses from their elbows.”
Financial instruments More importantly, most of our stakeholders understand that IFRS 9 appears most rational when in a state that the English call “pissed as a newt.” Taken literally, this poses a comparison to a kind of salamander, but it could also be translated as “very drunk.” Approaching IFRS 9 from the perspective of a pissed newt entails thinking less about the big picture – for example, what will I do with my life – than about the most immediate details – that is, do I have the wherewithal to keep moving one foot before the other without falling into the gutter? Our stakeholders know that such hazy pragmatism generally provides the only plausible means of navigating this vertiginous standard…
A single set of global standards The Inuit like to say that ᐅᖃᐅᓯᖅ ᐊᑕᐅᓯᖅ ᓈᒻᒪᔪᐃᑦᑐᖅ. Translated literally, this means that one language is never enough. Well, if the one language you have is Inuit, it may indeed limit your options a bit. But if your only accounting language is IFRS, it only really means that you may be better off avoiding the US with its silly local GAAP. And as no one wants to go to the US anyway these days, that’s perfect!
And there it is. Perhaps if I reflected more on the concept of what the Dutch call “welbegrepen eigenbelang,” I would let these examples remain in obscurity. But why would I start to exercise enlightened self-interest at this late stage in the game? Again, happy new year!
The opinions expressed are solely those of the author