I have written a lot about the new legislation for Human Capital reporting. It is refreshing to be on a topic that stirs some valuable discussion and debate. Wish that there was more of it on issues like design, the L&D organization optimization and such. Had we been a more challenging industry maybe learning styles would have been debunked a long time ago.
For my own learning I did a quite reprise of my thoughts on this topic.
What Is the Securities Exchange Act of 1934?
The Securities Exchange Act of 1934 (SEA) was created to govern securities transactions on the secondary market, after issue, ensuring greater financial transparency and accuracy and less fraud or manipulation. (Investopedia)
Transparency and accuracy. Is L&D ready for this? It doesn’t matter. Here it comes. Tail Will Wag the Dog post
A reading of the final regulation is a celebration of bureaucracy but in addition to adding “principle-based” and “materiality” to the L&D mainstream lexicon it also included some odd issues with words.
Opposed defining the term “human capital.” Well since it is not a critical term we will let that slide. WTF?
In any case I see this as huge opportunity to get our boss’ boss’ boss interested.
But with visibility comes accountability. Are today’s learning leaders ready for that?
I am excited to see how various Learning leaders use this new bit of leverage. This could be a big breakthrough for L&D, repositioning the function (appropriately) as mission critical. Or not.
The Next Frontier
Reporting drives the elevation of L&D from the side of “tell me what you do.” The next big shift will come from the accounting side. By changing the way that companies account for human capital spend the current investment per employee can be dwarfed. By making certain investments in human capital treatable as an asset those costs can be off set by an increase in asset value. Moving learning from a income sheet item (SG&A) to a balance sheet item to be depreciated over the usable life of that asset (average tenure?) is a game changer. It paves the way for huge investments in human capital.
Lots to come on this front for sure but here are some opening thoughts.