Hong Kong’s Noble battles allegations of shades of grey in its accounting

Since February, Noble Group’s stock has lost more than 60 percent as profits slid with commodity prices, its accounting methods came under attack and its credit outlook had gone from stable to negative.

All this has made Asia’s biggest commodities trader a better company, chief executive Yusuf Alireza said yesterday.

"Even the environment that we’ve gone through over the last six months, at the end of it we will be a better firm for it," he said.

While Alireza said Noble faces more scrutiny than rivals that aren’t listed or rated by credit agencies, it wants to continue as a public company because the challenges help it improve.

"As a public company, you have many more stakeholders that are constantly challenging you," Alireza said. "You have an independent board, you have shareholders, you have bond investors, you have rating agencies, you have analysts that are constantly challenging you to become a better firm."

The company, started in 1986 in a small Hong Kong office by former scrap-yard worker Richard Elman, is enduring one of its most difficult years. Attacked by a group calling itself Iceberg Research since February for its accounting methods, the company has attracted further detractors and short-sellers and become the most shorted stock in the Singapore benchmark Straits Times Index.

Noble has rejected the criticism against it, pursued stock buybacks and made numerous statements defending its accounting.