Swiss-based Adecco, the world’s largest employment agency, has appointed a top executive to the position of compliance and business ethics officer.
The move coincides with the conclusion of an independent investigation into the accounting crisis that hit the company earlier this year.
Tundé Johnson, Adecco’s former senior vice-president for international corporate affairs, will assume responsibility for further development of internal compliance procedures, systems and general business culture.
He will report directly to the board of directors.
Commenting on the appointment, which was announced on Tuesday, Adecco Group CEO Jérôme Caille said: “We remain strongly focused on the installation of best practice across the range of our systems and procedures.
“This reflects not only our wish to learn from… the lessons learnt during our financial reporting issues earlier this year, but to build further a business culture that will secure our world leadership in staffing services into the future.”
Clean bill of health
In a related development, Adecco said an independent investigation into alleged accounting irregularities at the company had now been completed.
It said the investigation, commissioned by Adecco’s audit committee and carried out by Swiss and United States lawyers under independent oversight, did not identify any issues that were “financially material” to the Adecco Group.
The company added that it continued to work to strengthen its internal controls in areas identified during the 2003 audit.
Adecco’s handling of what proved in the end to be minor accounting control problems snowballed into a financial and public relations disaster earlier this year.
Investors lost billions of dollars and the chairman, finance chief and other senior executives all lost their jobs.
“We are happy that, after all the hustle and bustle, there were no further surprises,” said Rudi Buxtorf, fund manager at Coutts Bank Switzerland.
Swings and roundabouts
On Tuesday Adecco published its second-quarter results, which show that auditing costs related to the accounting crisis were partly offset by a one-off financial gain.
The €30 million ($36.2 million) gain on the sale of internet job-search firm Jobpilot partially made up for €41 million in accounting charges and adviser fees caused by the book-keeping problems.
For the first half of 2004, revenues were up three per cent to €8.1 billion.
Operating income before amortisation was down 30 per cent to €174 million, but rose by one per cent excluding the impact of costs associated with the reporting delay.
Net income dropped 17 per cent to €125 million, including the €30 million sale proceeds.
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Adecco’s accounting woes began when auditors Ernst & Young refused to sign off on 2003 figures.
The firm said they were accurate and refused to restate them, but publication was delayed for months and the share price was hammered.
Adecco revamped its board in June, after chairman John Bowmer stepped down in the wake of the accounting scandal.
Adecco has appointed a senior executive to the newly enhanced position of compliance and business ethics officer.
An independent investigation into the accounting scandal that rocked the company earlier this year has concluded that there were no major financial irregularities.
Adecco executives hope they can now draw a line under the affair.