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1、INDEPENDEN T P U B L I C AT I O N BYRACONTEUR.NET27/03/2022#0796Distributed inAlthough this publication is funded through advertising and sponsorship,all editorial is without bias and sponsored features are clearly labelled.For an upcoming schedule,partnership inquiries or feedback,please call+44(0)
2、20 8616 7400 or e-mail .Raconteur is a leading publisher of special-interest content and research.Its pub-lications and articles cover a wide range of topics,including business,finance,sustainability,healthcare,lifestyle and technology.Raconteur special reports are published exclu-sively in The Time
3、s and The Sunday Times as well as online at .The information contained in this publication has been obtained from sources the Proprietors believe to be correct.However,no legal liability can be accepted for any errors.No part of this publication may be reproduced with-out the prior consent of the Pu
4、blisher.Raconteur Media/future-cfo-2022raconteur/raconteur_Contributorsadvances in IT and pandemic-driven commercial pressures have accelerated the evolution of CFOs,transforming them from financial manag-ers into strategic masterminds.While their role historically focused on compliance,reporting an
5、d financial man-agement,CFOs must also serve as consult-ants and communicators.Using real-time data and analytics,they are providing insights into their companies operations,influ encing their strategic direction.“The biggest change in the CFOs role over the past five years is that its gone from tac
6、tical financial manager to strate-gic partner to the CEO,”says Mike Beach,CFO of Chargebee,a revenue management platform.“Since the onset of the pandemic there has been an even greater focus on data.Companies are really drilling down into the different parts of their business,trying to understand th
7、e numbers and identify opportunities and efficiencies.”Handled effectively,this material can give crucial insights into not only the finances of the organisation,but also its ESG credentials,its progress on diversity and inclusion,and its long-term trajectory.The CFO brings a detailed grasp of fig-u
8、res,along with an understanding of the companys strategy and the very latest information about the conditions in its markets.Such factors mean that they are well placed to act as the custodian and interpreter of the wealth of data thats genera ted by their organisation.“CFOs are serving as valued ad
9、visers and consultants to the entire executive team,”perhaps any other person in the organisa-tion,says Will Johnson,CFO at marketing platform Iterable.With such a good overview,theyre in a position to look forward,rather than back,he adds.“Its more important than ever for CFOs to look down the road
10、 and execute lane changes to avoid potholes,rather than staring in the rear-view mirror.”Mohit Daswani is CFO of ThoughtSpot,a unicorn analytics business,and a former CFO of the payments,risk and technology businesses at PayPal.He believes that the new breed of CFO needs to be objective about perfor
11、mance measures,grounded in data and collaborative in their approach.“Data is power,”Daswani explains.“CFOs must be prepared to dive into the detail to understand the real trends at play.Armed with the right data,CFOs help stakeholders throughout the business to collaborate and succeed.”To this end,C
12、FOs should be at the cutting edge of technology.This means making full use of business intelligence,big data analytics and AI advances such as mach-ine learning.These technologies yield far greater insights than the spreadsheets of yesteryear,but they also require human interpretation to use the inf
13、ormation to plan effectively.“CFOs can help to upskill their colleagues so that they become data-led decision-makers,”Daswani says.This will enable the business to weather volatility and take timely actions that will have a real impact.In their new role,CFOs need to take the information gleaned from
14、 AI and interpret CFOs extend their remit to go far beyond the numbersSeveral factors have combined in recent years to allow finance chiefs toenlarge their sphere of influence.So much so,in fact,thattheirrolecould be described as chief collaboration officerBeach says.“They are responsible for plan-n
15、ing years ahead,anticipating markets and building road maps for long-term success.”Chitra Balasubramanian,CFO at soft-ware development platform CircleCI,notes that CFOs are the first to analyse the impli-cations of a particular problem,mitigate risk and determine the best next step.“They offer huge
16、value in bridging teams within a business as well as communicat-ing to external audiences,”she says.“They are vital in fundraising,supporting the company and understanding how custom-ers will react to changing business models.They go beyond the numbers and under-stand all aspects of their enterprise
17、.”Gone are the days of the siloed CFO.The role is shifting from chief accountant to chief insights officer,becoming much more operational in the process.The CFO has a better view across the businesses“and a more holistic lens”than this for the rest of the organisation,pro-viding deeper commercial un
18、derstanding to help other departments make important strategic decisions.It isnt enough to keep those data func-tions solely within the finance depart-ment,argues Susy Roberts,executive coach and founder of Hunter Roberts,a people development consultancy.“CFOs need to be much more aware of trends wi
19、thin their own organisation,their sector and globally,so that they can advise on the reality behind the reports,”she says.“Helping people to understand why decisions need to be made is a skill that every successful leader needs.CFOs with the ability to make finance mean-ingful to those without a fin
20、ancial back-ground are indispensable.”The CFO role isnt shifting so much as expanding,according to Sarah Spoja,CFO at Tipalti,a specialist in accounts payable and procurement automation software.On top of budgeting,forecasting and strategic planning,they are partici-pating in projects that will tran
21、s-form their companies,she says.This means collaborating with departments that were pre viously seen as non-financial responsibilities sales and marketing,for example as well as the wider C suite.CFOs are also grappling with huge chan-ges that have occurred in organisations over the past two years.T
22、hey are having to deal with a more dispersed workforce and incorporate ESG priorities into their busi-nesses,for instance.But time-consuming finan-cial tasks that once had to be performed manually are now being handled by auto-mated systems,which has given CFOs more freedom to operate outside the ac
23、counting silo.As a consequence,they have been able to take more value-adding work.“The role of technology in modernising financial processes is crucial in enabling CFOs to break out of their finance only bubble,”Spoja says.“This enables them to focus on high-impact initiatives and lead on wider busi
24、ness strategy.”The global economy is being driven by technology and digitalisation in particu-lar,putting leaders and their teams under pressure to adapt quickly.The new breed of CFO is in a unique position to aid this process.They can become role models for adopting digital transformations and all
25、the tools that go along with them.“The CFO is a strong,central role.It is critical in both stabilising and accelerat-ing the business,”says Thomas Seifert,CFO at Cloudflare,a cybersecurity special-ist.“Digital transformation is putting a lot of pressure on companies to change and adapt their busines
26、s models and CFOs are at the centre of this.”CFOs are in a unique position,he adds,because they can find a way forward by analysing data to understand corporate and industry trends.They are pivotal in product innovation,for instance,because they can report on purchasing behaviour.“Controlling and re
27、porting numbers isnt all thats important to the CFO anymore,”Seifert says.“The CFO is the guardian of a companys most valuable asset:data.Data science and analytics is as important for the CFO as traditional accounting has always been to finance roles.”THE FUTURE CFOC A R E E RSI N T E RV I E WI N F
28、 L AT I O NCFOs may have the ambition to become CEOs,but do they have all the skills to lead a business?The CFO of Cimpress on how its adoption of remote-first working has saved millions of dollarsAs input costs spiral,finance chiefs are being forced to rethink their pricing strategies050607Marianne
29、 CurpheyAPwC,2022CFOs ARE PRIORITISING COLLABORATION ACROSS THE BUSINESSShare of finance chiefs citing the following as high priorities in 2022Establishing finance as a business partner across the enterprise50%Building predictive models and scenario analysis capabilities for financial planning and f
30、orecasting48%Automating processes using intelligent systems39%Reducing cost as a percentage of total revenue30%Revising enterprise risk management practices23%Enhancing ESG reporting and disclosures,including diversity,equality and inclusion23%Establishing governance and reporting controls on non-fi
31、nancial metrics19%Moving finance to the cloud17%Increasing investment in compliance functions15%Other5%The CFOs role has gone from tactical financial manager to strategic partner to the CEO Armed with the right data,CFOs help stakeholders throughout the business to collaborate and succeedS T R AT E
32、GYLead publisher Helen GlynnDeputy editorFrancesca CassidyHead of productionJustyna OConnellDesign/production assistantLouis NassManaging editorSarah VizardReports editorIan DeeringAlthough this publication is funded through advertising and sponsorship,all editorial is without bias and sponsored fea
33、tures are clearly labelled.For an upcoming schedule,partnership inquiries or feedback,please call+44(0)20 8616 7400 or e-mail .Raconteur is a leading publisher of special-interest content and research.Its pub-lications and articles cover a wide range of topics,including business,finance,sustainabili
34、ty,healthcare,lifestyle and technology.Raconteur special reports are published exclu-sively in The Times and The Sunday Times as well as online at .The information contained in this publication has been obtained from sources the Proprietors believe to be correct.However,no legal liability can be acc
35、epted for any errors.No part of this publication may be reproduced with-out the prior consent of the Publisher.Raconteur MediaSub-editorsNeil Cole Gerrard CowanKate WilliamsonDesignKellie JerrardCelina LuceyColm McDermottSean Wyatt-LivesleyDesign directorTim WhitlockIllustrationSara Gelfgren Samuele
36、 MottaRodrigo AmaralA British/Brazilian journalist covering business and economics from his base in Madrid.MaryLou CostaA writer specialising in sustainability,tech,startups and the future of work.She has had work published by outlets including The Guardian,The Observer and .Morag Cuddeford-JonesA b
37、usiness journalist with more than20 years experience of delvinginto major commercial andtransformation issues.Marianne CurpheyAn award-winning financial writer,blogger and columnist writingfor various publications.Shewas formerly a staffer at TheGuardian and The Times.Ben EdwardsA freelance journali
38、st with more thana decade of experience as an editorial and commercial writer.Hisspecialisms are finance,business,law and technology.Karam FilfilanA business editor and journalist specialising in HR,the future of work and innovation.He was previously deputy editor of Changeboard.Clare GascoigneA for
39、mer FT staffer who is now ajournalist specialising in the City and otherfinance-related matters.Alec MarshAn author,journalist and editor-at-large at Spears magazine,who contributes to titles as diverse as TheSpectator and The Field.Chris Stokel-WalkerA journalist and author specialising in technolo
40、gy and culture,with bylines in The New York Times,TheGuardian and Wired.T H E F U T U R E C F O02Commercial featuref you look at the CFOs at most big companies,youll see a group of people with similar backgrounds,usually built on solid accountancy and finance experience.But the changing nature of th
41、e role has opened the door to a wider range of people.The challenges facing businesses in the future of work are turning the job into an increasingly strategic one.Yes,bookkeep-ing,financial reporting and compliance are still important,but these tasks are being delegated down the chain.Instead,CFOs
42、are focusing on influenc-ing business strategy,leading teams and performing complex data analysis.The era of the pure number-cruncher is coming to an end,with finance chiefs coming from backgrounds ranging from marketing to biomedical science.McKinsey&Cos latest global survey on the role of the CFO
43、shows how its remit is evolving.Between 2016 and 2021,the per-centage of CFOs responsible for investor relations grew from 44%to 64%.It was a similar story in post-merger integrations(32%to 43%),procurement(34%to 42%)and digital operations(9%to 31%).In this context,its unsurprising that the profile
44、of CFOs at forward-looking firms is evolving.But what benefits can such experience bring?Sabrina Castiglione is CFO at informa-tion security software provider Tessian.Her academic background is in chemistry.Despite having spent five years working as an actuary,she believes that a traditional account
45、ancy background isnt the most important preparation for the role.“A modern finance function is split into two arms.One is business as usual,look-ing backwards at compliance and regula-tion,”she explains.“As a CFO,once you have a good team running that,it isnt where your time is spent.Its on the fina
46、n-cial analysis and planning side,where youre optimising for business outcomes.”Castiglione joined Tessian in its infancy in late 2016,becoming the organisations seventh rec ruit.She joined as chief of staff,expanding her role to take responsibility for finance,HR,IT and legal matters.As the busines
47、s developed,her involvement in fundraising and financial modelling increased.Her role was formalised as CFO in 2018.It was only then that she took her accountancy exams.Castiglione believes the challenges faced by startups and scaleups mean that their CFOs need to be more operationally min-ded than
48、those in more established firms.“Startups move so quickly that even quart erly plans can be ripped up,”she says.“Having a CFO who is aware of the big Karam Filfilanpicture is key,especially for businesses backed with venture capital,where the constraint is time,not money.Its about understanding the
49、drivers and the block-ers to making the business go faster.”As with other C-level roles,this requires CFOs to develop effective relationships throughout their organisations.Emotion-al intelligence is important in such work,as is the ability to understand the specific operating model of your company.
50、“If as CFO you are spending all your time on accounting rather than with the sales team,people team and tech team,your focus is wrong.Accounting is important,but its about influencing business out-comes.That requires developing deep relationships with other departments,”Castiglione adds.Catherine Bi
51、rkett is at the other end of the experience scale.She spent 14 years as CFO of Interoute,helping to increase the telcos revenue to 750m and managing the companys eventual acquisition by USfirm GTT Communications in 2018 for1.7bn.She is now CFO at fintech unicorn GoCardless,a specialist in recurring
52、payments.Like Castiglione,she believes that the changing requirements of the CFO role mean that well increasingly see candidates from other areas taking on the job,par-ticularly at high-growth businesses.But she thinks it will take a little while for them to emerge in numbers.“The modern CFOs skill
53、set is about getting a founder or CEO to believe youre not going to inhibit growth;that youre going to sup-port the business in growing its top line;that you get the commercial side;and that youre strategic,all while still having that solid accounting basis,”Birkett says.“The problem is that there a
54、rent masses of candidates like that out there.In 10 years time there will be,but right now theyre still coming through.”Birkett is a pioneering business-minded finance chief,having been promoted at the tender age of 31 to become CFO at Interoute,focusing on strategy and business development.Shed ser
55、ved as the firms head of financial planning and analysis for four years,having spent five years with KPMG in train-ing and transaction services.Birkett admits to lacking experience in aspects such as audit and financial control,but she says that“hiring good people”to deal with that side was crucial
56、in overcoming her early difficulties.“It was quite unusual to come at the role from that side at the time.In retrospect,I had nowhere near enough experience to do the job.I was thrown in at the deep end and my first job was to raise some money to stop us going bankrupt,”she says.By the time she took
57、 on her second CFO role at GoCardless in 2019,Birkett had spent 18 years with Interoute.Shed been there when the dot-com bubble burst in 2000 and when the global financial sys-tem melted down in 2007-08.Such experi-ences have proved invaluable to her in helping the payment provider to navigate its w
58、ay through the Covid crisis.“I went from someone who at 31 was the most inexperienced member of the C suite and continued being so for most of my time there to coming to GoCardless and being the experienced one,”she says.“Ive lived through real step changes in our world,so I know how you need to ada
59、pt to chaos,which has been a massive plus to the business.”Does Birkett think that future finance chiefs will move even further away from the figures,focusing more on organisa-tional design and operational manage-ment?Not with big data on the horizon.“For a CFO of any business,the strategic side is
60、super-important,”she says.“But the ability to deal with data will become mas-sively important too,so I think a numerical background will always be needed.”Its about influencing business outcomes.Thatrequires developing deep relationships with other departments Ive lived through real step changes in
61、our world,so I know how you need to adapt to chaos,which hasbeen a massive plusrom stay-at-home mandates to havoc in supply chains,and rapid inflation growth to war in Europe,todays business leaders have never had to deal with so much volatility on such a global scale.Those who have adapted with the
62、 most agil-ity and resilience share a key asset:a business-minded CFO.Beside every successful CEO is a strategic CFO who is helping to guide the business through change.This marks a stark evolution in the role of the CFO,from back-office bean-counter to trusted business adviser and change agent.Alon
63、gside the CEO,the CFO now has the most critical role in driving sustainable growth and manag-ing the increasingly complex risk land-scape.Yet in a business environment where unprecedented problems need solving,this is not an easy task.Traditional finance functions,which look in the rearview mirror t
64、o evaluate performance,are a thing of the past.To be successful,both in their own right and for the benefit of the wider busi-ness,CFOs must now be forward think-ing,analysing real-time financial and operational data to disseminate the right insights to the right stakeholders at the optimal time.The
65、y also need to act as a conduit for collaboration by aligning departments around key objectives.“Finance has to be ingrained as a proactive business unit,rather than a back-office support function,”says Steven Lockwood,VP UKI at Vena.“Businesses need to be more agile and resilient in the face of dis
66、ruption,and the CFO as a change agent,rather than a change inhibitor,must lead the way that organisations change and adapt to a dynamic environment.“The business partnering paradox has existed for years.Who can enable different parts of the business to work together when fundamentally theyre looking
67、 at different things?The CFO is best positioned to play that collabora-tive role,ensuring everybody is work-ing from the same numbers and in the same direction.Therefore,its impor-tant for the CFO to serve as a facilita-tor across the different business units,steering how they outrun competitors,rat
68、her than just being a hard-nosed numbers person who sits at the back listening to whats going on.”The best CFOs today are not just analytical.They have an acute com-mercial awareness and understanding of risk,combined with more contem-porary,softer skills like self-awareness,empathy and humility.But
69、 there are several issues still holding them back from fulfilling their new strategic busi-ness partnering role.The first is the prevailing percep-tion of finance as more of a back-office inhibitor of change than a change agent helping the business remain relevant.This is not only an outside percept
70、ion but many people within finance also have that perception of themselves.The CFOs collaborative abilities are crucial here;they must communicate the finance functions new role inter-nally and externally.Second,even if the CFO possesses the skills to be a trusted business adviser,there is still a s
71、kills gap in the wider finance function.The leading accounting bodies are seeking to close that gap by offering courses on how finance professionals have to be agile,technically minded,innovative and drivers of business change,as opposed to simply understanding the numbers.Finally,CFOs require the n
72、ecessary tooling and technology to successfully fulfil their new role.This is a mammoth task given that most finance functions are still dominated by archaic,manual processes.As a result,finance teams spend far more time on basic data collection and analysis than crucial forecasting,planning and oth
73、er high-er-value business partnering activities.A high proportion of this analysis is still being undertaken in Excel,due to the requirement for flexibility,agility and commonality across users.To better serve as strategic business partners,CFOs are leveraging tech-nology that connects people,depart
74、-ments,processes,systems and data to more effectively facilitate change across the organisation.This tech-nology must be flexible and,crucially,accessible.Technology will only be embraced pervasively if all users can adopt it with a sufficient degree of cog-nitive comfort.“We all work best with some
75、thing that is comfortable to use,”says Lockwood.“That is why the iPhone was such a success because it was designed in a way that anyone could use with ease.You focus on solving the prob-lem rather than how to operate the tooling.This is evident in cases where CFOs try to implement a technology that
76、people dont like or understand or want to work with.When people dont buy in,you quickly see an emergence of shadow IT which helps no one.“Vena overcomes this issue by pow-ering finance-led business planning and real-time reporting with a tool whose front-end is something every-body can use with cogn
77、itive ease:spreadsheets.Spreadsheets have been around for over 50 years and they arent disappearing in any way.Why?Because people are comfortable with using them.We know Excel and spread-sheets are still dominant through finance,which is why Excel is at the core of our platform.”Venas Complete Plann
78、ing and Analysis platform can be owned and operated by finance with minimal reli-ance on IT.The platform streamlines financial and operational planning,connecting disparate source systems to provide a holistic,up-to-the-minute view of business performance.It also provides accurate reporting and ana-
79、lytics,while automating manual pro-cesses to free up time for value-added analysis.The platforms multi-dimen-sional modelling capabilities power rapid scenario planning and analy-sis,with embedded business intelli-gence delivered through data visual-isations and interactive dashboards.Most important
80、ly,its intuitive interface means anyone can use it,driving rapid adoption across the business with facilitation by finance.One organisation which has embraced the technology is Citizens Advice,a prominent national charity specialising in offering free confiden-tial information and advice for people
81、with benefits,debt,consumer,hous-ing and other issues.Since using Vena,Citizens Advice has been able to signif-icantly enhance how it manages work-force planning,which is a large propor-tion of many of its budgets.“Digital and technological change is a crucial part of finance transfor-mation,but it
82、happens alongside pro-cesses,people and culture.The abil-ity to take our spreadsheets and make them much more powerful in Vena has been integral to our journey,”says Josh Weinberg,head of financial sys-tems and change at Citizens Advice.“We also have to manage high levels of cross-charging and alloc
83、ations at a very detailed level,which is easily sup-ported within Vena.And we have been able to use Venas scenario dimension to improve how we manage in-year changes to funder budgets,which as a charity is important.“The ability to glean insight from raw data is key to strategic finance.A plat-form
84、which can consistently,automat-ically and visually present relevant and timely data enables senior manage-ment,budget holders and their finance business partners to focus their time and skills on analysing the numbers,rather than worrying about the qual-ity or relevance of the datasets.When its easy
85、 to scenario plan,you are in a better place to manage whatever comes at you.”For more information,visit tech empowers the CFO as a strategic business partnerTo thrive in a volatile landscape,organisations need their CFOs to be trusted business advisers.But this can only happen with powerful technolo
86、gy that everyone can use with cognitive comfortCommercial featureF The CFO as a change agent,rather than a change inhibitor,must lead the way that organisations change and adapt to a dynamic environmentConvertible assets:the skills of a thoroughly modern finance chiefThe CFOs role is evolving fast.W
87、hile technical chops remain important,a pure accounting background is no longer seen as a prerequisite for successC A R E E R SIEY,2021AGILITY IS A CFOS MOST IMPORTANT LEADERSHIP QUALITYShare of CFOs citing the following as the most crucial leadership qualities for future CFOsThe agility to adapt to
88、 continuous changeThe willingness to experiment and take calculated risksThe humility to admitto not having all the answersThe courage to try to change entrenched interests and beliefsEmotional intelligence66%51%5%33%46%R A C O N T E U R.N E T03 CFONot a barrierA big barrierCFOS ARE LESS WORRIED THA
89、N THEIR C-LEVEL COLLEAGUES ABOUT HYBRID WORKINGS COMMERCIAL IMPACTC-suite members responses when asked whether hybrid working presents a barrier to business growthPRODUCTIVITY AND INVESTMENT ARE ON THE RISEPercentage of UK CFOs who expect the following to increase,relative to the pre-pandemic trend,
90、over the next three yearsPwC,2021CFO31%9%CMOCIO9%10%10%11%14%26%24%31%29%27%CHROCOOCROThe past two years have been a particularly turbulent period for business.The pandemic has disrupted theeconomy and shifted how we work,possibly forever,while Brexit uncertainties also continue to affect UKplc.Many
91、 finance chiefs have had to focus on keeping their companies afloat during the turmoil,but how are they feeling now as the new challenges of 2022 start to present themselves?Fears about rapid staff turnover top thelist,but there are signs that optimism is growing on both sides of the Atlantic.HOPES
92、AND FEARSWHAT ARE CFOs MOST WORRIED ABOUT?Weighted-average ratings on a scale of 0 to 100,where 100 stands for the highest possible risk to business,as judged by UK CFOsEMPLOYEE CHURN IS A KEY CONCERN FOR CFOs IN THE USPercentage of US finance chiefs who say they are concerned about the impact of hi
93、gh staff turnover and labour shortages on their companies revenue growthPersistent labour shortages58Medium-term supply chain disruption51Effects of Brexit42Long-term effects of climate change55Increasing geopolitical risks worldwide48Weakness and/or volatility in emerging markets32Effects of the pa
94、ndemic56Further interest-rate increases and the tightening of monetary conditions50Economic weakness and/or volatility in US growth 36Higher inflation and/or a bubble in housing and other assets54Poor productivity/weak competitiveness in UK economy45Deflation and economic weakness in the eurozone30T
95、HE BIGGEST THREATS TO THE SUCCESS OF HYBRID WORKINGPercentage of finance chiefs from Fortune 1000 and private companies in the US who say the following are the main challenges Loss of corporate cultureLoss of mentoring opportunitiesLoss of innovation opportunitiesRisk that managers will treat on-sit
96、e and remote workers differentlyPoor utilisation of office spaceRisk of returning to 100%remote working if the Covid crisis deteriorates Determining which groups should be on site,how often and whenNot having the IT tools to support hybrid work effectivelyInsufficient cybersecurity measuresImpact of
97、 hybrid work on revenue growth48%40%29%24%19%18%17%12%11%9%PwC,2021PwC,2021Deloitte,2022Deloitte,2022Not at all concerned (we are not experiencing high staff turnover)Investment in digital technology and assetsBusiness performance and productivityInvestment in skillsCapital expenditureInvestment in
98、technology and other physical assets12%94%84%77%55%39%Very concerned (we think that staff turnover will remain high indefinitely)Somewhat concerned (we think that the rate will soon fall to pre-pandemic levels)Unsure (we dont know how long the rate will remain high)36%45%7%200202021Signif
99、icantly less optimisticSomewhat less optimisticSomewhat more optimisticSignificantly more optimisticBroadly unchangedOPTIMISM AMONG CFOs IS GROWINGPercentage of UK CFOs who say they feel the following levels of optimism about their companies financial prospects(in Q2 of each year)Deloitte,20211%1%1%
100、4%4%6%38%41%18%4%22%40%53%46%28%32%17%21%9%42%52%6%3%11%T H E F U T U R E C F O04Commercial featureThe futures green for CFOs Issues of finance and sustainability are becoming increasingly intertwined,as investors demand ESGmetrics alongside accounting data.How are finance chiefs dealing with this e
101、xpanded remit?ustainability has entered the busi-ness mainstream.Its become an issue that affects how all compa-nies operate and is a strategic priority for the C suite.As a result,CFOs are increas-ingly dealing with sustainability metrics that were once the preserve of the market-ing and investor r
102、elations departments.This is not necessarily an easy transition,reports Dafydd Llewellyn,EMEA general manager at insightsoftware,a provider of financial planning and reporting systems.“It would make sense for sustainability metrics to be aligned with corporate health metrics and discussed using simi
103、lar finan-cial language,”he says.“But this remains a challenge,given the lack of globally recog-nised sustainability reporting standards.”Unlike financial reporting standards,honed over decades by globally recognised forums such as the International Financial Reporting Standards(IFRS)Foundation,sust
104、ainability metrics are often poorly understood by investors.Different firms may prioritise different environmental,social and governance(ESG)goals,or pick and choose between different measures shouting about reductions in electricity usage but staying silent on whats occur-ring in their supply chain
105、s,for instance.But,as investors ask more awkward ques-tions about sustainability,CFOs are start-ing to apply their skills to ESG metrics.The IFRS Foundation has created the Inter-national Sustainability Standards Board to develop a global baseline of disclosure standards that meet investors needs.Th
106、e Financial Stability Board has set up the Task Force on Climate-Related Financial Disclosures.And the United Nations has brought together a CFO task force for its sustainable development goals,arguing that,“as stewards of trillions of dollars in corporate investments,CFOs are uniquely positioned to
107、 reshape the future of corpo-rate finance and investment as a catalyst for growth,value creation and social impact”.All of these developments mean that sus-tainability issues have become a key con-sideration for the finance function.“Sustainability work requires alignment with financial priorities s
108、uch as ESG re-porting,investor relations,capital man-agement,carbon accounting,impact measurement,corporate development and even product development,says Debbie Clifford,CFO at design software company Autodesk.“Sustainability is evolving from a cost centre into a value driver.It isnt yet influencing
109、 top-line growth,but,as the Clare Gascoigne regulatory pressures and costs of carbon emissions rise,we think it soon will be.”Its certainly a factor to be reckoned with for companies seeking significant invest-ment.Thai Union is one of the worlds largest seafood companies,with brands including John
110、West,Parmentier and King Oscar.Having raised more than 600m last year via sustainability-linked bonds and other loans,the firm is aiming to tie three-quarters of its long-term financing to its overall environmental performance,as well as specific metrics such as emis-sions and supply chain traceabil
111、ity.“Risk has always been fundamental to the CFOs role and theres a widespread recognition among the business commun-ity and our investors that the greatest risk is our changing planet,”says Thai Unions group CFO,Ludovic Garnier.“If we fail to halt and then reverse nature loss,a lot of the resources
112、 and services we rely on for business continuity will become increas-ingly scarce and unstable.”ESG considerations are increasingly becoming an integral element of corporate culture,according to Stephen White,CFO of Field,a startup in the renewables infra-structure sector.“The way we act on a day-to
113、-day basis at Field is naturally aligned to the ESG agenda its kind of taken for granted in the decisions we make,”he says.“But,frankly,I think that ESG reporting is a lot harder than reporting,say,profit and loss.”For example,Field has commissioned alife-cycle assessment of lithium-ion bat-teries t
114、o establish their carbon footprint and where their components come from.“Its the most prevalent battery techno-logy available and yet,unbelievable as this sounds,no one has done that assessment,”White says.This highlights how difficult it can be for companies to report effectively on sustaina-bility
115、.But one radical solution could involve embedding sustainability metrics within the finance function.Spanish renewables company Acciona moved sustainability from its marketing department to finance last year,creating the integrated role of chief financial and sustainability officer.The incumbent,Jos
116、 ngel Tejero,says:“Sustainability was our hallmark but it was starting to be perceived by stakeholders as a commodity.”Moving responsibility for it to the finance department gave equal weight to sustaina-bility and financial disclosures.“This entails reporting on our ESG per-formance with the same t
117、horoughness and discipline that is the norm in the case of financial indicators,”Tejero says.“The key per formance indicators in our ESG score-card include the ESG impact with respect to Ebitda,investment,carbon emissions,water and energy use,and our alignment with the EU taxonomy for sustainable ac
118、tivities.The integration of finance and sustainability lends coherence and disci-pline to our business purpose.”The more that sustainability metrics affect finance KPIs,the more crucial it is that CFOs develop a good grasp of how to measure and report on ESG.Sustainability metrics can provide busine
119、ss opportuni-ties,attract and retain long-term investors and so offer a competitive advantage.Garnier says:“The interest weve seen in our shift to sustainability-linked fin ancing at Thai Union shows that investors know that climate,nature and social issues have a significant impact on business perf
120、or-mance.If we hit our sustainability targets,we gain a more favourable interest rate.If we miss,were financially accountable via the opposite process.Our blue finance deals have been oversubscribed more than two times over.Investors wouldnt be show-ing that level of interest unless they knew that g
121、etting our sustainability strategy right directly affects our performance and the security of their long-term returns.”Sustainability is becoming as much a part of corporate culture as it is a part of the society in which we all live.Given that sustain ability is such a big and complex concern,the f
122、inance function cannot be held solely responsible for dealing with it.Nonetheless,it is clear that ESG metrics will become an ever more significant part of the CFOs remit in the future.Risk has always been fundamental to the CFOsrole and theres a widespread recognition that the greatest risk isour c
123、hanging planetWhy do many organisations end up in these fi nance transformation horror stories?From our experience there are always a few common ingredients.The fi rst is a lack of alignment with business ambitions.It comes back to the way traditional fi nance was perceived as being a back-offi ce f
124、unction.This can lead to technology and transformation initiatives not being linked to business objectives and failing to add value to the wider business.The second is the“band aid approach”-the habit of consistently buying tech solutions that solve one small pain point.This results in a series of s
125、ystems linked together in a haphazard fashion.Data integration becomes a problem and most people revert back to their old spreadsheet-based processes.The third is poor communication.Finance folks arent the greatest sales people and this can be challenging when it comes to rallying the business behin
126、d change initiatives.The why and how are not relayed in a compelling manner that allows wider stakeholders to under-stand the difference between“this new budgeting and forecasting system will allow us to move away from Excel”and“this new budgeting and forecasting system will allow us to spend 60%mor
127、e time on value-add work such as sce-nario modelling”.Finally,the day-to-day life of the fi nance function can be incredibly hectic.A new change programme is often the last thing you want to balance with business as usual which can cause delays.How should fi nance try to align more closely with busi
128、ness ambitions?Finance must break away from its former back-offi ce percep-tion.This is done by consulting each business function and understanding where fi nance can add value.The transformation initiatives that you embark upon can be easily linked to fi nance supporting your growth ambitions.It of
129、ten helps to start with a tagline to bring focus.One of our cli-ents said:“Im going on the M&A war-path over the next three years;give us a fi nance function to support this”.This allowed teams to focus on a goal and design the processes and systems needed to reach it.Technology and systems are a ho
130、t topic at the moment.How do we avoid the band-aid approach and get it right?Buy strategic platform solutions.There are so many solutions on the market now that can handle a multitude of cases and dont cost the earth.Moving past the constraints of only looking at two to three large technology vendor
131、s allows us to have many fantastic options.Free online resources can guide you through this buying process or you can leverage an external partner.When it comes to fi nance supporting business ambitions,think about how much easier it is to derive insights from a simplifi ed,connected tech landscape
132、than the complex web of legacy systems and spreadsheets.Finally;think about what the busi-ness will need two to three years from now.One of the biggest mistakes is having an“itll do for now”mindset.The time,energy and expense it takes to“rip and replace”after two years is never worth it.If you see t
133、he business outgrowing the technology within fi ve years theres probably a better option out there.How do we begin to get everyone on board with change?Finance needs to think like a mar-keting department.If we look at the type of large-scale change fi nance is involved in,such as totally overhaul-in
134、g an ERP or changing the way inves-tors will consume reports around key metrics,if the messaging around the why and how this is happening doesnt land,it makes it diffi cult to keep people on board.The fi rst step is to aim for small incre-mental deliverables rather than a“big reveal”.At VantagePoint
135、 we leverage agile methodologies which allow us to regularly play back our results to stake-holders.This might not be for every-one but,due to extended timelines,we fi nd the more traditional consulting approach can lead to a lack of engage-ment from the team.Weve all heard the tales of multi-millio
136、n pound pro-jects getting abandoned.Avoid being another horror story by incrementally delivering value and staying true to business ambitions.How do organisations avoid the trap of“starting after next year end”and begin to make changes,when people are busy?Much of this mentality comes from a time wh
137、en installing any system or embarking on a transforma-tion project with a consulting fi rm was viewed in years rather than months and weeks.Its understandable but no longer the case.Today we can make great strides in a short time by deploy-ing cloud-based technology and work-ing in an agile fashion.
138、With the amount of information avail-able at your fi ngertips there is so much you can do for free without the need for massive external spend.We try to think about our work in blocks.A frequent question is;“what can we do in 8-12 weeks that will provide tangible value and take us one step closer to
139、 our goal of being IPO-ready?”Looking at balancing your everyday work and trying to make these incre-mental changes can be diffi cult and this is where you can lean on exter-nal support.We dont want to pull the fi nance team of a growing acquisitive business completely away from their day to day.Ins
140、tead,think about a part-ner that can allow you to spend 80%of your time on business as usual and allocate 20%to giving quality input to your chosen consultancy.What made you start VantagePoint and how do you help organisations avoid these nightmares?We started VantagePoint to pro-vide an alternative
141、 to traditional consulting and technology options available to CFOs.Its our belief that areas of the market need a differ-ent approach that can take them from ideation all the way through to actually managing successful technology implementations.Its impossible to avoid every fi nance transformation
142、 horror story out there but here are some steps to take away:Firstly,get fi nance aligned with busi-ness ambitions and clearly commu-nicate how this will take the business closer to its goals.Secondly,make strategic decisions around both partners and technology to avoid many common pitfalls.Having 1
143、0 different consulting partners and seven different cheap solutions will eventually become unmanageable.Finally,start today.Finance trans-formation doesnt have to be big and scary.Taking that fi rst step will always be worthwhile no matter how small.For more information please visitvantagepoint.cons
144、ultingCFO Playbook-How to avoid becoming another fi nance transformation horror story!Matt Benaron,director at VantagePoint,shares his practical steps on how your organisation can avoid becoming another fi nance transformation horror story in 2022 Q&Afi nance transformation horror story in 2022 S U
145、S TA I N A B I L I T YS The integration of finance and sustainability lends coherence and discipline to our business purposeAccenture,202244%47%26%2.6Xcite an inability to define/prioritise ESG issues for disclosure as a barrier to measuring/reporting ESG performanceof business leaders have created
146、KPIs and sourced data enabling sustainability value creation to be tracked and managedof CFOs agree that they have reliable data to underpin eachkey performance indicator on ESGhigher shareholder returns were achieved by firms with high ESG performance relative to those with a medium performance fro
147、m 2013 to 2020R A C O N T E U R.N E T05Unnatural selection:dofinance chiefs make great business leaders?here once was a time when the route to the top of an organisation was a well-trodden one.To assume the role of CEO,a candidate would need to work their way through the ranks of their business to b
148、ecome deputy chief executive and then take over when their boss stepped down.The only significant alternative to this approach occurred when a firm opted to parachute in an experienced CEO from another company.But that time was long ago.Over the past two decades,85%of serving CEOs in the S&P 500 hav
149、e either achieved promotions from one of three C-suite roles CFO,COO or divisional CEO or leapfrogged straight into the top job from a position one level below them,according to The Last Mile to the Top,a 2021 research report by manage-ment consultancy Spencer Stuart.Of all the CEOs appointed to the
150、 USs big-gest plcs in 2020,10%previously served as a CFO double the proportion whod taken this route at the turn of the millennium.This trend indicates a growing belief among finance chiefs that their roles are as good a preparation for the top job as any other,if not better.Indeed,a recent survey o
151、f CFOs by accounting software company Sage found that 77%of respondents were harbouring ambitions to become CEOs.The main reason for this trend is clear,says Andrew Kakabadse,professor of gov-ernance and leadership at Henley Business School:over the past 25 to 30 years,the function most crucial to e
152、nsuring the effec-tive operation of a business has changed from product delivery to finance.“Cost consciousness and control of the or-ganisations costs,as a stepping stone to profit,has become a key issue,”he explains.Mark Freebairn is partner and head of the board and financial management practices
153、 at executive recruiter Odgers Berndtson.He believes that the career path from CFO to CEO is becoming increasingly popular because“the CFO is the only other person in the company with same commercial bandwidth and breadth of vision across the whole business.The CFO is also the only person who has th
154、e same level of investor and board relationships as that maintained by the CEO.”The Sage survey supports Freebairns view:95%of the CFOs it polled said that they were deeply involved in nearly every aspect of their firms operations.The logic of promoting a CFO to the top job may be clear,then,but the
155、 jury is out on whether its necessarily the best appoint-ment a firm can make.Spencer Stuarts S&P500 study found that former CFOs were 24%less likely than former COOs to have led their companies into the top quartile of performance as measured by shareholder return and 41%less likely than leaders wh
156、od leapfrogged them into the CEO role.A study covering large US plcs has concluded that former CFOs are significantly less likelythan candidates drawn from other rolesto prove successful as CEOsThis chastening finding is a clear sign that competence in managing a firms finances doesnt necessarily tr
157、ansfer to running the whole organisation.As Kakabadse,who advises businesses on succession planning,stresses,the move up from CFO to CEO is still“a massive jump”.Yet the most visionary CFOs-turned-CEOs know that the data is not always to be trusted.Freebairn argues that“the only perceived conflict w
158、as that CFOs were always seen to be risk-mitigating,which led to the lazy stereotype that they couldnt grow a business.This has since been dis-proved several times over.”Doug Baird,founder and CEO of the New Street Consulting Group,believes that a CFO is most likely to become an effective leader“whe
159、n financial issues are at the heart of the businesss strategy,such as when a turnaround is needed”.He cites Peloton,which has struggled badly in recent months.Its appointment of Barry McCarthy,a former CFO at Netflix and Spotify,to the role of CEO in February was a smart decision under these circum-
160、stances.With his experience,“McCarthy clearly grasps the subscription model”,Baird says.“Peloton needs someone with significant financial acumen to steer the business back to full health and make its investors feel comfortable.”Another sensible choice,according to Baird,has been the appointment of X
161、avier Rossinyol as CEO of Swiss travel retailer Dufry.Hes due to take up the job in June,having previously worked for the group as CFO and,latterly,a regional COO.Rossinyol had left Dufry in 2015 to become CEO of airline caterer Gategroup.“He knows the business,having worked there previously.He has
162、already been a CEO in its sector,so he brings vision and com-mercial skills back to Dufry,”Baird says.The capital markets are less convinced byRossinyols credentials,though:Dufrys share price fell when news of his appoint-ment broke in February.Baird says:“To find the perfect fit,we must look beyond
163、 someones CV and assess what they have achieved,as well as their natural character.Its simply not the case that all CEOs are adventurous and all CFOs are conservative.CFOs often take calcula-ted risks.”While he accepts that its unwise to gener-alise,Anthony Chadwick,founder of the Alpha Vet Internat
164、ional group of compa-nies,believes that the traits that often make CFOs successful are unlikely to work in their favour when they become business leaders in most situations.Last year he stepped aside as CEO of one of his firms,The Webinar Vet,to focus on developing newer units in the group,and appoi
165、nted the COO,Kathryn Bell,as his replacement.“My own feeling is that,while CFOs can be ideal candidates for some companies,they are often conservative,”Chadwick says.“Detail is their strong point and,given their accountancy background,they prefer to save money,not spend it.”Such tendencies make them
166、 a better fit for a larger,well-established business,whereas they might struggle in faster-moving firms that must frequently adapt to disruption in their sector,he suggests.“These younger businesses often need to be more agile and have a high profile in their industry,”Chadwick says.“CEOs must incre
167、asingly be the voice of their company to comment on hot topics and bring a larger employee base along with them as the busi-ness develops.This requires strong commu-nication skills and personal empathy.CFOs will often struggle in these areas.”HOW ARE FORMER CFOs PERFORMING AS BUSINESS LEADERS?Market
168、-adjusted shareholder returns of S&P 500 firms,by their CEOs previous rolesSpencer Stuart,2021Chris Stokel-WalkerWhats the biggest shift youve seen in the use of technology by the fi nance function over the past two years?Arguably the biggest shift is the move to new ways of working around forecasti
169、ng,budgeting and pro-cessing VAT returns.By automating the manual processes,my team has been able to focus on higher-value work,in turn,signifi cantly reducing the amount of manual work required.With that unin-terrupted focus,enhanced data analyt-ics and instant reporting,we can make faster decision
170、s about business opera-tions with the confi dence that our data is accurate.How has your company embraced hybrid working?We want our employees to make hybrid working work for them.Some colleagues will want to be in the offi ce full time,while others will want to blend working from home with com-muti
171、ng.To support the transition,we are launching a Connected Working pro-gramme to encourage team members to return to the offi ce on a more regular basis.We are also empowering our teams to tell us which days they want to be in the offi ce.Several activities have been planned,including live training s
172、essions and team collaboration events to sup-port our employees as we operate in what will be a hybrid working environ-ment in the future.What effect has hybrid working had on productivity and how do you maintain engagement and communications?Adopting a cloud accounting soft-ware system has helped t
173、o bridge the physical gap between colleagues,enabling them to work together more productively on the same server,access the information they need and share documents instantly.Im able to see the outcome of their work wher-ever they are based.To maintain collaboration and engagement,you need a framew
174、ork for scheduling appraisals,feedback ses-sions and team meetings.For those operating a permanent remote-work-ing policy,its important to sched-ule face-to-face meetings with staff throughout the year to boost engage-ment and social interaction.Advanceds annual business trends survey found that 70%
175、of senior fi nance professionals have limitations in their current technology that hold them back when working remotely.How does this impact the fi nance team and the business?Using outdated technology makes it challenging for any fi nance team to meet these new demands while remaining productive an
176、d effi cient.The right technology signifi cantly enhances the integral role of the fi nance function and,importantly,enables the CFO to act as the CEOs sounding board.This strengthens the relationship between the two and the overall performance of the fi nance team,enabling them to provide intellige
177、nce and analysis that improves business decision-making.Technology can also increase automa-tion and reduce manual processes,ena-bling CFOs to reduce the costs of the fi nance function.What advice do you have for organisations wanting to digitally transform their fi nance function?Successful impleme
178、ntation of dig-ital transformation relies on good communication.A CFO needs to invest the time to listen to the team,address their concerns,questions and opinions,and explain the benefi ts of the changes to them and to their work.Building trust in this way reassures employees and helps to secure the
179、ir buy-in for digital transformation.What are the risks for those not prioritising digital adoption?The pandemic has massively accel-erated the speed of digital adoption by businesses,so the most obvious risk is falling behind the competition.With capabilities around automation,data analytics and in
180、stant reporting,digital fi nance solutions increase the speed,accuracy and effi ciency of the fi nance teams work.They make it easier to comply with changes to legislation,as many software solutions are regularly updated with compliance in mind,and offer more protection against malicious security th
181、reats.Digital prioritisation is essential for business.What successful digital transfor-mation projects has your business undertaken?With the global shift to remote and hybrid working,we had to fi nd more effective ways of communicating and collaborating with colleagues,which included the adoption o
182、f Microsoft Teams as our instant messaging service.This enables us to stay connected and conduct virtual meetings via video chat.We are also adopting some of the new digital systems we provide to others.For example,by rolling out our Cloud HR system to the wider business,managers have access to all
183、HR functionality on any device,anywhere-from booking annual leave and logging sickness,to developing a personal development plan and book-ing training.Weve made our new MyWorkplace plat-form available internally,allowing all staff to create their own unique virtual work environment with access to sp
184、ecialised functionality that can assist with their typical daily tasks.This also serves to boost productivity.Many UK businesses have strug-gled to retain top talent.What is your talent retention strategy?Talent acquisition is a major chal-lenge for every organisation.However,with the great resignat
185、ion,retaining talent,particularly in fi nance,isnt just about losing staff to compet-itors,but also losing them to other life choices,such as career breaks and self-employment.To retain valuable talent you need to understand peoples motives for wanting to leave and ensure you offer a working environ
186、ment that refl ects their needs and meets their expectations.Like every business,during the pandemic we had to be agile and make changes that helped our teams feel engaged,fulfi lled and able to produce their best work wherever they were based.How crucial are the best technol-ogies to talent retenti
187、on?Technology can have a huge impact on your ability to attract and retain top talent,with certain expectations around digital tools,particularly among Gen Z employees.Without the right tech-nology,people can become disillusioned and more inclined to head for the door.Providing teams with regular op
188、portu-nities to master new technology gives them the chance to develop and to have a stronger sense of loyalty to a company that is invested in them and their career.For more information please The digital revolution transforming fi nanceThe pandemic radically transformed the way that organisations,
189、especially fi nance teams,work.Richard Kerr,who recently joined software company Advanced as CFO,shares his experiences and reveals his insights into the digital revolution of fi nanceThe right technology signifi cantly enhances the integral role of the fi nance function and,importantly,enables the
190、CFO to act as the CEOs sounding boardof fi nance professionals have increased the amount of software and number of apps they use for their job during the pandemic.76%of fi nance professionals dont have a good user experience when using software at work.77%of fi nance professionals believe their curr
191、ent technology hinders theirproductivity at work.42%of the technology used by fi nance teams supports team collaboration.26%of the apps fi nance teams use do not support mobile working.56%Advanced,2021L E A D E R S H I PCommercial featureT Its not the case that all CEOs are adventurous and all CFOs
192、are conservative.CFOs often take calculated risksCFOCOOBelow C suiteTop quartileMiddle quartilesBottom quartile60%0%10%20%30%40%50%Divisional CEOT H E F U T U R E C F O06The shift has had amassive impactThe CFO of Cimpress,Sean Quinn,has led a remote-first strategy thats resulted in an annual cost s
193、aving of$9m for the Irish-domiciled US company.He explains how finance chiefs can become effective advocates for remote working ean Quinn,CFO and executive vice-president at Cimpress,enjoys what he describes as a“truly holistic view”of his firms operations.With his oversight of HR,legal,communica-ti
194、ons,real estate and procurement across the business,he was the ideal choice to lead the companys remote-first strategy.Given that this strategy had since gener-ated an annual cost saving of$9m(6.8m),other CFOs in a similar position might be motivated to follow his lead.Cimpress,the owner of Vistapri
195、nt,chose to go remote-first in October 2020,after finding that its pandemic-enforced move to remote working earlier in the year had had a positive effect on both the productivity and wellbeing of the affected staff.The transition had covered 1,600 office workers 20%of Cimpresss total workforce.It wa
196、s decided that Quinns broad remit would help to reinforce the remote-first strategy across the whole company,ensur-ing that many teams were united behind the move and that crucial decisions could be made more quickly.And a transforma-tion of this scale ultimately involves signif-icant financial choi
197、ces not least how to spend the money saved making the CFO the most appropriate person to be driving the initiative at strategic level.“The CFO is well placed to lead the deci-sion framework and set the right tone to enable the organisation to push forward faster into the future of work,”says Quinn,w
198、ho is based in Boston,Massachusetts.But he adds that its important not to see a seven-digit cost saving as the end game.Rather,the whole endeavour needs to be contextualised as a chance to rethink and redesign how work works.Then the CFO can reallocate capital to where it can bene-fit the business a
199、nd its people the most.“The shift has had a massive impact on engagement,productivity,recruitment and retention,”Quinn says.“This will ulti-mately be a key ingredient in our delivery of business outcomes.So being able to look at opportunities for cost savings in our real-estate footprint,for instanc
200、e and then thinking through where that capital can be more efficiently redeployed for the benefit of our team members becomes a great opportunity.”Reinvestment decisions have resulted in the establishment of a remote working stipend to enable people to purchase the necessary home office equipment;th
201、e crea-tion of a dedicated eight-person remote-first success team;and the formation of a personalised remote onboarding process to cover new recruits first 100 days in the job.Such measures have been complemented by extra learning and development oppor-tunities,valued at$5,250 per head each year.Emp
202、loyee benefits have also been enhanced.New features include recharge Fridays(in essence,afternoons off on that day)and a regular allowance to spend with any small business.“Managing teams in a remote environ-ment is different,so we need to ensure that were providing the right resources for that,”Qui
203、nn adds.A slide deck explaining the remote-first culture in detail has been sent to all staff.This sets out the logistics of the change,covering elements ranging from asynchro-nous working to non-linear work days.“If we form good habits with respect to documenting information in a place thats commun
204、al,it means that everyone can see it,they can learn from it and they can add to it,”Quinn says.Nearly 60%of the companys remote workers have abandoned the traditional 9-to-5 schedule,with Cimpress encourag-ing them to design their day around their personal commitments and preferences.While there are
205、 some extreme examples of night owls and early birds,Quinn reports that people mostly take pockets of time out for themselves during the day,such as a break for a Peloton workout for which the company provides a subsidised subscription or to attend to their domestic responsibilities.The company is a
206、iming to make a balance of 90%focused solo work and 10%meetings the default,using several IT tools to help people keep meetings to a minimum.These include remote work-space platform Confluence,virtual white-board Miro,project management app Trello and cloud management system Box.“Weve had to ensure
207、that we role-model this from the executive level down,”he says.Meetings were so much of a calen-dar suck,so I think this approach drives much more powerful business results.”The transition to remote working has had a marked impact on gender equality in the business.Cimpress has more than doubled the
208、 number of women it has recruited to MaryLou Costa The CFO is well placed to lead the decision framework and set the right tone to enable the organisation to push forward faster into the future of workCommercial featureCommercial featureCommercial featureThe future of fi nancial operations managemen
209、tWith the economic outlook appearing increasingly uncertain,CFOs need to shift away from manual processes to more automation to free up their time for strategic planningn a volatile economic landscape rocked by an almost constant stream of global confl icts and uncertainties,business continuity and
210、resilience have shot to the top of the CFO agenda.The ability to be agile in the face of disruption is now business critical and the most pressing concern for CFOs over the next fi ve years is ensuring the balance sheet is robust enough to survive future fi nancial downturns,according to research co
211、nducted by BlackLine last year.CFOs and the overall fi nance and account-ing(F&A)function have a critical role to play in providing consultancy,analysis,planning and due diligence to ensure sound busi-ness decision-making.Their efforts will largely be futile,however,if they continue to be bogged dow
212、n by archaic manual pro-cesses and fi nancial data scattered across disparate systems.Many organisations have automated pro-cesses such as accounts payable,but manual processes are still prevalent in accounts receivable.Applying customer payments to customer accounts quickly and accurately is the co
213、rnerstone of this department,how-ever manual processes lead to delays in unlocking crucial cash fl ow.The money owed by customers is one of the largest assets on any balance sheet,with PwC estimating the amount of work-ing capital tied up in this way at a mammoth 1.2tn(1tn)globally.Strong cash fl ow
214、 is central to every companys sustainability and resilience,and releasing cash from receivables is the quickest and cheapest way to more working capital.Yet organisa-tions continue to be held hostage by their own accounts receivable processes.Elsewhere,the myriad of old,open and unsettled intercompa
215、ny transactions is F&As biggest distraction,forcing it to focus on governance rather than guidance and analysis.A study by Deloitte found that intercompany transactions for mul-tinationals can dwarf their external sales by a factor of 10-and sometimes more.Intercompany transactions represent the lio
216、ns share of the global economy some 70%of international trade,according to the Organisation for Economic Co-operation and Development.“With an average enterprise seeing thou-sands of intercompany transactions across different units,geographies and time zones,the fi nance teams time is dominated by d
217、is-putes and digging up information to reconcile counterparty data,”says Marc Huffman,CEO of BlackLine,whose cloud-based solutions automate and streamline key F&A processes.“As they also typically need to access multiple ERP systems,data is not standard-ised.Continuing to fi re-fi ght these issues i
218、s unsustainable as businesses look to be more agile and resilient.Meanwhile the intercompany supply chain just gets longer and more complex.Although accounts receivable and intercompany activities are usually segregated in most organisa-tions,the outcomes of these processes are symbiotic unleashing
219、balance sheet,net income and cash potential.”Automation is the key to streamlining processes for both accounts receivable and intercompany fi nancial management.BlackLines fi nancial operations manage-ment platform integrates,orchestrates and automates F&A processes to fully support this function.It
220、 delivers intelligence and fi nancial insights to the business by uncov-ering risks through analysis,while optimis-ing controls and eliminating manual pro-cesses to generate ongoing,incremental value through continuous improvement.Replacing manual,spreadsheet-driven processes not only allows busines
221、ses to gain unprecedented visibility and valuable intelligence,ensure accountability,foster collaboration and improve decision-mak-ing,it also frees the fi nance team to focus on strategic and value-adding work.Accounts receivable automation unlocks cash fl ow while enabling organisations to save mo
222、ney,be paid earlier and access powerful intelligence to inform stra-tegic decision-making,says Huffman.Automating intercompany accounting processes,meanwhile,boosts effi ciency,reducing days-to-close by an average of 60%while accelerating access to cash and avoiding intercompany balance write-offs t
223、hat impact earnings and investor confi dence.“Switching to BlackLine can help some companies reduce manual processing by as much as 85%,reduce unapplied cash by up to 99%and process 80%of payments without the need for remittances,freeing up vital resources and enabling the rede-ployment of employees
224、.That makes it an investment that will typically pay for itself within a year-and in some cases just 12 weeks.These kinds of gains are central to achieving real business resilience.”For more information,visit IContinuing to fi re-fi ght these issues is unsustainable as businesses look to be more agi
225、le and resilientI N T E R V I E WSkey leadership positions.There has also been a marked improvement in female representation in senior tech roles.And the number of women leaving the business hasfallen by one-third year on year.Only one employee so far has cited the firms remote-first transition as t
226、heir rea-son for quitting.And,taking advantage of their ability to work from anywhere,10%of Cimpresss remote-first workforce in the US have moved to another state.The firm has retained a small number of office spaces,reinventing them for sched-uled learning and collaboration sessions.Employees who w
227、ant to work there more regularly have the option to do so,and those who live in areas where Cimpress didnt have an office before the pandemic are being offered coworking memberships.Quinn admits that he had little apprecia-tion for remote working before the Covid crisis.But now he is one of its bigg
228、est advo-cates,not least because of the extra time it has given him with his family.“My son recently asked me to take him to sharpen his skates before hockey practice,which was at 5pm.If wed still been in an of-fice,Id have gotten home at 7pm,so theres no way Id have been able to do that,”he says.“A
229、nd,whenever my CEO asks if Im around for a catch-up,its totally accept-able for me to say:Im out with my son from 5 to 5.30pm,so lets talk after that.Theres not even a question about it.”REMOTE WORKING HAS GENERALLY WORKED OUT WELL FOR FINANCEReported changes in productivity resulting from the adopt
230、ion of remote working in finance teams worldwideCapgemini,2020IncreasedNo changeNo answer58%20%2%Decreased20%R A C O N T E U R.N E T07lower-quality alternative any more than he can compromise on the materials for his handmade box-sprung mattresses.The dilemma facing Savoir Beds will be familiar to c
231、ompanies across the UK,as finance chiefs confront the realities of rising input costs and squeezed profit margins.Do you swallow the cost increases or put up your own prices?If you do the latter,do you pass on some or all of the increase to customers?Or do you substi-tute things in your service or p
232、roduct for cheaper alternatives?CFOs in many firms are therefore finding themselves at the centre of key discussions about price variation.“The dialogue between finance,the supply chain,marketing and sales is enor-mously important,”says Michael Haupt,a partner at Deloitte Consulting and author of Th
233、e Contemporary CFO.CFOs will be looking at securing prices now,as well as examining all aspects of working capital management.Theyll also be considering what adjustments,if any,can be made to their supply chains.Many will need to make calls on which of their firms customers and suppliers are poten-t
234、ial credit risks too.Most crucially,CFOs must recognise that navigating their busi-ness through this period of uncertainty is their responsibility,according to Haupt.“The times when CFOs were looking only at the financials are long gone,”he says.“In most companies,they are not only the second strong
235、est in the organisation,but a key decision-maker.One of their main emerging roles is not just to take enterprise-wide responsibility,but almost to be the glue of the company an integrator,a change agent in these times.”By virtue of their role,CFOs have“a very strong network in all parts of the busi-
236、ness Its almost the only function that could quickly coordinate the response,”CFOs really earn their stripes when they can differentiate between whats going on now and other shocks weve hador Alistair Hughes,co-owner and MD of Savoir Beds,the price of birch plywood has become a hot topic.From June t
237、o September 2021,he watched the cost of this material used by his firm to make headboards increase from 54.70 to 98.50 a sheet as the UKs post-lockdown economic recovery fuelled a spike in prices.The war between Russia and Ukraine has since added to the infla-tion,given that much of the worlds wood
238、is sourced from the former.Hughes decided to make a bulk order of plywood to protect the firms margins from any further hikes.His usual supplier,which had originally quoted 98.50,then warned him that he could be looking at a further 40%increase.“Theyre thinking that the price will be at least 137 a
239、sheet,but we didnt have a price,which was a pretty crazy situation,”he says.Fortunately,Hughes decided to increase Savoir Beds prices by 10%at his annual pricing review last October.He made this choice in the knowledge it might reduce sales volumes.But there are limited alternatives for a high-end m
240、anu-facturer such as Savoir Beds.Hughes cant switch the birch in his headboards for a Reviewing prices has become a top priority for many finance chiefs as costs rocket.It will take considerable judgement to strike the right balanceHaupt adds.And they must get on top of urgent data-related tasks“lik
241、e the analy-tics how you run that pricing model,how do you do things such as scenario planning understanding whats going to happen to our inventory if I change our prices,say.”This is something that only CFOs can deliver.But then they need to communi-cate it,taking“customers and stakeholders and inv
242、estors along with you”,he says.Sir Andrew Likierman is professor of management practice in accounting at London Business School and a former CFO and government finance chief.He believes that effective CFOs are able to make a clear-sighted assessment of the situation.“CFOs really earn their stripes w
243、hen they can differentiate between whats going on now and other shocks weve had,”he says,pointing to the differing impacts of Covid,Brexit and the financial crisis of 2007-08.This approach will help to inform the response for example,whether its appro-priate to increase the price of a product or red
244、uce its size in the hope that consumers dont howl in protest en masse.“What differentiates a high-quality CFO from someone who simply deals with the num bers is that they can engage in this discussion as a full part of the team,”says Likierman,who adds that simply produc-ing data isnt enough.Its imp
245、ortant to understand how the people making the decisions need to look at the numbers.“CFOs will have to put those numbers into some kind of context,”he says.“They must move from providing data to provid-ing information.”But its about even more than being a good communicator:the CFO must have a strat
246、egic eye on the business,Likierman argues.“Its just not someone who ham-mers out the numbers,sits back and waits for somebody else to make a decision.”So what are CFOs to do?Ultimately,its down to the needs of their company,the market it operates in and the view it takes of the inflationary period:i
247、s it permanent or will things settle back down?If so,when?Haupts view is that no one really knows,“so the best strategy you can have is being prepared for various scenarios”.Hughes,meanwhile,has all but made his bed.He wont be waiting until the next scheduled pricing review in October to make a move
248、.Hes considering the possi-bility of another 10%rise as early as June.“If its less than 5%thats required,I wouldnt do it.We could manage.But,as it creeps above that,things become unman-ageable,because your margins arent so high.Making a bit less money is one thing;losing money is quite another.”THE
249、PRICE IS RIGHT?Share of CFOs citing the following as priorities for maintaining or increasing margins in 2022PwC,2022Alec MarshQTheres a lot of talk about xP&A in the world of finance,but how exactly does it work?SGI think of extended planning and analytics(xP&A)as the next evo-lution of integrated
250、planning,a concept most companies are familiar with.It uses the latest generation of perfor-mance management technology to obtain deeper insights into a companys operations,supporting senior leader-ship and individual departments to improve decision-making.Using xP&A,firms can break down silos and c
251、ombine greater volumes of data across their business than pre-viously possible.The data is linked,cleaned and made useful for reporting purposes using the latest advances in machine learning and big data analytics.OCThe ultimate goal is to help businesses achieve strategic objectives faster growth,g
252、reater efficiency and effectiveness.Firms are often surprised by the richness of operational insights that can be achieved using xP&A and the trends uncovered.Never before have com-panies been offered such a clear,uni-fied view of their operational and financial reporting.ACxP&A is transforming the
253、role of the CFO,whose remit extends beyond reporting,control and compli-ance.Theyre becoming intentionally vital to the creative and strategic direction of the business.QHow far along are CFOs in embracing xP&A?SGxP&A is absolutely a growing trend.They may not necessarily be using the term,but throu
254、gh conver-sations with CFOs across all industries we know they are looking at increasing efficiencies in their planning pro-cesses and improving access to data-driven insights.They want to plan effectively and efficiently to improve profitability and rapidly adapt to unex-pected world events.CEOs an
255、d CFOs need to make bold decisions to remain competitive;to do that,they need the facts and the data.We often hear comments along the lines of I need connected vis-ibility of what is happening across the organisation and I need to know how our decisions affect the bottom line.These are the exact are
256、as where xP&A helps.ACResilience,responsiveness,and predictive and actionable insights are goals made possible by modern finance technology platforms and a will to change how work is done.This is on the CFO agenda.QWhat are the barriers to adoption and how does inlumi help?SGThere is a misconception
257、 that implementing xP&A is a massive,big-bang change.With a clear roadmap,a modular approach can be taken to deploy gradually and itera-tively.There are two important ingredi-ents for success:first,the vision and ability to integrate and connect data across the business with highly scalable technolo
258、gy.Second,executive spon-sorship and leadership to drive change and adoption.OCinlumi is not a technology pro-vider per se,instead we help organisations identify the most effec-tive solutions and support their imple-mentation across the business.One of the challenges is encouraging senior leaders be
259、yond the CFOs office to take ownership of data quality so it can be funnelled into a single,streamlined system to drive user buy-in.That means bridging departments as varied as sales,distribution,engineering and marketing.Here,our extensive experi-ence delivering technology-enabled change programmes
260、 helps as we ensure collective C-Suite sponsorship and adoption within the business.QIs the cost to change a concern?SGTraditionally,the business case for planning solution investment has been a challenge as its difficult to quantify real returns.xP&A is different.It highlights operational inefficie
261、ncies and opportunities think productivity blackspots or areas of waste ulti-mately saving money and improving margins in the near to medium term.The business case is clear.Whats harder is quantifying the longer-term profit gains that come from smarter decision-making and increased responsiveness.Th
262、e more foresight you have on your operations,the easier it is to enhance profitability.QHow has xP&A helped your clients?OCWe are currently helping a global car safety manufacturer with its xP&A journey as it seeks greater insights on its operations and financial planning.As a B2B business,achieving
263、 efficiencies and stopping waste is vital to improving margins.The manufacturer needs to understand the profitability of its busi-ness at a very granular level,from the components and materials it uses through to the plants its operates from globally.inlumi has helped the company gain that understan
264、ding so it can make smarter operational choices.As you can imagine,the moment you start asking questions about the location of plants or sourcing of raw materials,you begin to collaborate with departments beyond the CFOs office.Part of our job has been to help drive that cross-de-partmental collabor
265、ation and break down silos,so strategic decisions can be made based on the facts uncovered in the data.QWhat role do you expect xP&A to play in business in the coming decade?SGThere is an undeniable demand from executives to be able to make strategic decisions based on reli-able,up-to-date enterpris
266、e data.This means that organisations are starting to reassess their legacy reporting solu-tions and are looking at next-genera-tion platform technologies.I see the uptake of xP&A only gaining momen-tum,especially as organisations realise the possibilities and the power of the finance platform techno
267、logy.OCWere at the start of this journey but I expect more companies to adopt xP&A as time goes on.Ultimately,its about improving return on invest-ment by unlocking data at the heart of a business.That feeds back into the wider organisation,driving growth and improving resiliency.ACOrganisations wil
268、l continue to connect and improve their plan-ning processes-xP&A is the next stage of that journey.The goal is to be more agile,efficient and strategic in an increasingly competitive business landscape.For more information please visit or contact +44 7958 524083xP&A-the new frontier in advanced fina
269、ncial planning The relatively new trend of extended planning and analytics(xP&A)is transforming financial planning by giving firms much greater insight into their operations.inlumi consulting director Susan Gittings,executive principal Omer Cander and chief executive Ashley Chapman discuss the incre
270、asingly important role that finance functions play in shaping organisational strategyof finance functions have responded to the data boom by promoting greater use of corporate-approved performance data from a centralised,finance-governed sourceGartner 73%CFOs grapple with pricing dilemmas as inflati
271、on takes holdP R I C I N GCommercial featureFRevisiting pricing53%Re-evaluating investment decisions to focus on margin-improving projects36%Increasing the use of automation to offset increases in labour costs43%Re-evaluating the real-estate footprint26%Accelerating digital transformations to achiev
272、e automation and standardisation48%Evaluating a significant enterprise-wide cost-cutting programme30%Optimising the supply chain37%Other2%T H E F U T U R E C F O08SWOT team the ins and outs of exploring novel markets abroador the boldest companies,periods of high volatility are the perfect time to s
273、eek opportunities in new territories.CFOs will be assessing the risks and costs of many such ventures in 2022.As capital markets turned bearish at theturn of the year,investment bankers reported increasing demand from clients for finance for M&A deals aiming to take advantage of distressed or under
274、valued assets around the world.Take the acquisition of HX Tracker,a producer of solar tracker systems based in China,by its US-based rival,FTC Solar,in March,for instance.(Solar trackers are devices that change the orientation of solar panels to maximise the energy they absorb from the Sun.)FTC Sola
275、r said the deal would help to grow its business not only in China but also in the Middle East,Africa and other foreign markets.Another example from March is the pur-chase of Florida-based wellness company JustCBD,by Canadian cannabis firm Flora Growth.The deal will enable Flora Growth to enter the U
276、S market for cannabis-based packaged goods via 300,000 direct cus-tomers.The acquisition will also give it access to 14,000 stores in the worlds larg-est market for its product.These are just two forward-looking deals in fast-growing areas that are likely to benefit from recent global developments.R
277、enewable energy looks set to grow signif-icantly as the global economy moves away from fossil fuels owing to ESG concerns and the war in Ukraine.Similarly,sales of cannabis-based products are on the rise asa growing number of countries legalise marijuana for medical or recreational use.Further oppor
278、tunities undoubtedly exist in thedeveloped world,although these are perhaps more numerous in emerging markets,where companies and govern-ments alike are making a strong effort to catch up in areas such as digitalisation.That has been creating potential for enter-prises with proven expertise in this
279、field.In such cases,joint ventures with local players could be a better way to enter a new market.Last year,private equity giant KKR joined forces with Telefnica and c reated businesses to deploy fibreoptic networks in Colombia and Chile.The Spanish telco is a seasoned operator in Latin America and
280、its experience will help the new enterprises to navigate markets that can be tricky for new arrivals.Local expertise is essential,especially in emerging markets,where the operational environment is often more challenging than it is in developed economies.Chile and Colombia are widely viewed as two o
281、f the most business-friendly economies in Latin America.Even so,both countries have been shaken by political and social unrest,including riots,over the past couple of years.As CFOs work on the financial arrange-ments to expand into new markets,they need to be aware of not only the commer-cial opport
282、unities but also the social and political circumstances of the terri tories in question.This imperative is more rele-vant today than it was a few years ago,warns Claudine Fry,a partner at intelli-gence provider Control Risks.“Political risk has become a much greater concern for business over the pas
283、t couple of years as the geopolitical environment has become more turbulent,and rising nationalism and populism have fuelled an increase in the risk of exposure to events such as contract violations,non-payment,regime changes and asset seizures,”she says.“But what has been particularly striking is t
284、he emergence of political risk as a key concern in developed markets,as well as in emerging markets.It is a critical threat to business wherever you are.”Control Risks believes that a growing number of sectors will be seen as strategically sensitive by governments as the geopolitical temperature ris
285、es around the world.The threat of sanctions or nationali-sation is also real,as hundreds of western companies realised after the Russian invasion of Ukraine.These are certainly not the out-comes a company expects when deciding to invest in new markets.Its hardly surprising that recent surveys have f
286、ound that CFOs are lukewarm when it comes to expanding their businesses across borders.But achieving growth in new markets may be a matter of looking for the safest opportunities.In a recent note to its clients,credit insurer Atradius pointed to a handful of economies that it thinks present good opp
287、ortunities for investors and exporters.Some arent the types of names youll often see in the financial pages Ivory Coast,Qatar and Uruguay,for example.Others are better known as investment destina-tions,such as Taiwan and Israel.What all five of these economies share,according to Atradius,is the abil
288、ity to recover strongly once the pandemic ends and the potential for solid GDP growth even this year 5.7%in the case of Ivory Coast.Some experts think CFOs should focus on economies that wont keep them awake at night in other words,countries that have institutions in place that ensure the rule of la
289、w and the sanctity of contracts.At a wider level,this includes elements such as a free press,a competitive party-Turbulent times are a trigger for some firms to seek out new territories.Their CFOs must work out where and how to invest across bordersbased political system,an independent judiciary and
290、 other characteristics asso-ciated with mature democracies.“Strong institutions,the rule of law and investor protections set the foundations forgrowth in markets.”So says Perth Tolle,founder of Life+Liberty Indexes,a firm that models equity investment strategies from metrics based on social,politica
291、l and economic freedoms in emerging markets.This approach may provide peace of mind for investors in the long run,but it might also restrict the universe of poten-tial markets for companies.When Tolles own fund started applying its criteria to agroup of 26 emerging markets,only 11 of them scored hig
292、hly enough to receive allo-cations.China and India werent among them and neither were Saudi Arabia and Turkey.Brazil barely made the cut.These are widely considered to be among the most important emerging economies.On the other hand,Tolle managed to stay away from Russia.The fund based on her index
293、returned almost 7%in 2021,while the MSCI Emerging Markets Index closed the year at-2.5%.Perhaps now is the time to pay greater attention to well-managed markets than to large ones.Rodrigo AmaralE X PA N S I O NFBot or not?Get ready forauto-accountingAutomating the finance function is proving valuabl
294、e for CFOs,freeing up resources,boosting efficiency and even improving employee engagementhe CFOs world is changing.Although all companies have their own particular challenges and opportunities,a single technolo-gical development is at the heart of the transition:the rise of automation.For some,auto
295、mation is helping their businesses bootstrap their way to growth.Consider Double,a flexible assistant service for executives and their teams,for instance.The US startup has raised more than$14m(9.9m)in funding so far.According to Quentin Servais Laval,the firms head of finance and strategy,it faces“
296、a lot of heavy finance processes”.Yet,until very recently,the finance team was“30%of one person”.Automating a range of finance tasks has freed up resources,enabling the company to appoint its first full-time recruit to the team.Servais Laval com-pares the set-up with the one he experi-enced in his p
297、revious role as director of finance and operations at the Benefit Cosmetics brand in the LVMH luxury goods group,where the finance depart-ment had a team of 50,of whom 30 were dedicated to routine accounting tasks.There was already some automation sitting inside the enterprise resource planning plat
298、form,such as accounts payable and payment processing.By contrast,thanks to automation,Doubles finance team spends only 20%of its time on typical accounting duties.The other 80%is devoted to financial planning and analysis,nurturing inves-tor relationships and serving as a part-ner to the business.“C
299、omparing my first experience in fin-ance with now,it used to take us a day and a half to gather all the information needed to produce reports.Today,every Monday at 5am the process runs auto-matically and we receive an email.All we need to do is review the metrics,”Servais Laval says.“Were able to ga
300、ther much more information than we could in the past and run it more quickly.If we want to run an ad hoc analysis about atrend,we simply put together an Excel sheet.Were much more responsive.”Stefan Cars is the founder and CEO of Snowfall Travel,atechnology company Morag Cuddeford-Jonesproviding a m
301、ultimodal marketplace to the travel industry,which works with some of the worlds biggest travel brands.Automation has significantly reduced its accounting burden,he reports.“Expenses used to be a cumbersome process.With automation,every expense is automatically taken from a linked Mastercard and upl
302、oaded to the system.Its checked against our policies,so we can focus on the real deal,such as setting the policies,”Cars says.The CFO doesnt usually perform tasks such as checking individual expense submissions,he notes,but automation generates better-quality inputs for the people who do,liberating
303、the whole team to tackle more complex tasks.This has benefits beyond making the department more efficient.IAt improves emp loyee engagement and makes the company a more attractive place to work.This in turn helps it to lure high-quality recruits,who will be able to improve its performance.Its a virt
304、uous circle.Servais Laval says:“To attract the best talent,we need to ensure that people are engaged and focused on where they are adding value and what excites them.A lot of the traditional finance and accounting functions werent very exciting.”None of this means that automation will replace skille
305、d individuals.Finance departments still need to be skilled enough to ensure that automation is working as it should be,Servais Laval stresses,as well as dealing with the edgecases that platforms typically can-not handle.“Having much more accurate cash flow forecasts and forecasting models,access to
306、real-time data and applying machine learning or robotic process automation the automation of largely repetitive tasks has been a game-changer for the finance function and the CFO in parti-cular,”Cars suggests.“They can put more time into analysing the informa-tion and come to all those meetings with
307、 more accurate data.The world is shifting so much;you need to be agile.You cant wait even a month to make decisions.”Allowing technology to take care of the grunt work is obviously liberating,but using automation and AI is about much more than merely getting the numbers crunched more efficiently.As
308、a global travel technology company,Snowfall works across many borders and deals in several currencies.In todays volatile economic climate,getting its currency(FX)hedging strategy right to protect the business against sudden shifts in currency values is more important than ever.If companies choose to
309、 bring their FX hedging in house,it demands a lot of expertise and they expose themselves to a great deal of financial risk.If they out-source,fees tend to be significant.Snowfall works with Bound,a digital hedging provider,to automate its trades and de-risk its FX hedging.Cars says:“What Bound does
310、 is ground-breaking.If you are exposed to foreign exchange risks,its a cumbersome pro-cess.Companies both large and small wont necessarily have someone who is super-savvy about all the risks that they are taking on in this respect.Even if CFOs have some understanding,being on calls with banks takes
311、a lot of time.Using Bound,our FX transactions are automatically de-risked.”Going beyond robotic process auto-mation and exploiting the intelligence part of AI is what excites both Servais Laval and Cars.“Its still early on,but helping on both the internal and external auditing side is a big help for
312、 the CFO,especially in the past couple of years when weve seen a lot of issues from the big four auditors,”Cars says.“Youll see much higher accu-racy in real-time data,finding irregular-ities and knowing where to focus,as well as in delivering data to auditors.”Servais Laval reports that Double has
313、been able to automate on the processing side while it manages most of the edge cases.The firm expects that smart mod-els will be used more for forecasting,which is largely a manual process today.“Teaching our models to use our data and metrics to enable us to predict trends more accurately will also
314、 become more useful to other departments,”he says.“If I could bet on what my finance team will look like in five years,this is what well bemoving towards.”The world is shifting so much;you need to be agile.You cant wait even a month to make decisions What has been particularly striking istheemergenc
315、e of politicalrisk as a key concern in developed markets,as well as in emerging marketsA U T O M AT I O NTWHICH ECONOMIES LOOK LIKE WINNERS IN 2022?CFOs rating the prospects of regional economies as“good”or“very good”in 2022Deloitte,202145%40%37%28%12%North AmericaEuropeAsia (excluding China)ChinaSo
316、uth AmericaGartner,202020/780%3Xthe minimum daily hours and days each week a robotic full-time equivalent will workof finance chiefs have implemented,or are planningto implement,robotic process automationThe cost of an offshore employee relative to a robotic full-time equivalent.Onshore employees co
317、st five times as much as a robotic full-time equivalentR A C O N T E U R.N E T09Commercial featureto better manage a range of emerging challenges from ESG reporting to con-troversy issues.Shifting to this model will allow the tax and finance function to fulfil its role as a value-added business part
318、ner engaging in high-level strategic tax issues.Co-sourcing tax and finance allows CFOs to show their corporate boards that they are getting to grips with three sig-nificant challenges facing every business today creating value,managing risk and reducing cost.No wonder so many busi-nesses large and
319、small are looking for a piece of the action.The views of third parties set out in this publica-tion are not necessarily the views of the global EY organisation or its member firms.Moreover,they should be seen in the context of the time they were made.To find out more,visit companies are transforming
320、 their tax and finance functions to increase value84%are likely to co-source tax and finance in the next two years as 95%of companies seek to reallocate budget from routine to strategic activities81%of respondents say EY is the global market leader for co-sourcing tax and statutory reporting service
321、sof respondents say EY is the global market leader for data and technology tax services49%53%51%47%17%15%15%Competitor 1EYEYCompetitor 2Competitor 319%16%16%Competitor 1Competitor 2Competitor 3EY,2022alent shortages,legislative change,technological transfor-mation and disruption caused by the pandem
322、ic are some of the challenges placing unprecedented pressure on cor-porate tax departments.The world has suddenly become difficult for in-house tax specialists as an growing set of requirements crowd their agenda.These developments are increasing the workload for the same tax and finance functions t
323、hat are facing budget cuts and unparalleled skills shortages.In response to these pressures,many businesses are co-sourcing select tax affairs to tech-enabled tax specialists.The mounting complexity of modern tax systems is leading corporate tax depart-ments to pass at least some of the responsibili
324、ty for routine work to out-side providers.Whether its value-added tax(VAT)filings or statutory accounting,co-sourcing routine tax tasks is a way to improve efficiency and give senior staff the breathing space to help develop answers to some of the big strategic questions facing businesses.“We have n
325、ever seen a time like this in the tax profession,”says Kate Barton,EY global vice chair tax.“All of these issues are converging:talent challenges,the need to address environmental,social and governance(ESG)issues,a desire to drive long term value,unrelenting legislative and regulatory change,and cos
326、t pressures.”Stuart Lang,EY EMEIA tax and finance operate leader,says data and technology are key enablers to help tax departments cope.“You can either automate basic tax tasks internally or undergo a tax transfor-mation by working with an outside pro-vider that has made significant invest-ments in
327、cloud technology,”he says.Dave Helmer,EY global tax and finance operate leader,agrees:“Doing nothing is not a valid option.You might get your ESG wrong,you might over-pay on your tax bill,face a big controversy issue,or you might not understand all of the legislative and regulatory change that is co
328、ming.The stakes are high if you dont transform.”Dealing strategically with these impor-tant issues is difficult because core responsibilities of tax and finance depart-ments have also been made exponentially complicated by an increase in digital tax filing requirements from governments.An increasing
329、 number of jurisdictions are demanding tax information daily,weekly or monthly,with transactions provided directly to the government in digital fil-ings.This has forced businesses to focus on their own data and technology for day-to-day tax management,even as they try Overstretched tax and finance f
330、unctions turn to co-sourcing Digital transformation,talent shortages and regulatory change are putting pressure on already overworked tax and finance functions,forcing them to seek productive partnershipsto respond to increasing demands.As a result,todays tax professional is having to become multisk
331、illed,with the ability to process large amounts of new tax technical information while also mas-tering the technology and data needed to enable efficient and accurate filings with governments.For the tax industry,that means developing a whole new type of renaissance tax professional,as much a data a
332、nalyst and tech specialist as a tax and accounting expert.Hampering this process of profes-sional transformation are the talent shortages that have hit the economy during the pandemic.Many employees have decided to change jobs,leave the job market all together or retrain in new fields.At the same ti
333、me,many older pro-fessionals are reaching retirement age,just as the shift to digital technology has created a shortage of tax specialists with the right skills and qualifications to carry out the significantly more complex range of tasks at hand.Tax was already getting harder for busi-nesses before the pandemic came along.Led by the G20 and the Organisation for Economic Co-operation and Developme