Crisis management brings out the best in CAs
Business resilience will rely in large part on its
finance professionals – tenacity and creativity
are required, says Catherine Burnet CA
Last month’s issue resonated strongly with me. In our cover feature, we examined the challenges faced by the retail sector during the COVID-19 pandemic and how professionals responded with incredible innovation and creative thinking. It was a powerful reminder of how integral finance teams have become to businesses of all kinds.
Sarah Bruce CA, Finance Controller, MENA, at Lush, said it best: “Gone are the days when finance sat in an office, not communicating with the rest of the business. It is now part of the team at the centre of everything.”
It’s a topic that was also discussed by ICAS CEO, Bruce Cartwright CA, in our May issue. The importance of accountancy is magnified in a crisis because finance professionals possess a unique understanding of how businesses operate and how the many moving parts fit together and interact. To borrow a turn of phrase from Bruce, when a decision needs to be made, “accountants understand the business levers that need to be pulled”. It’s this mix of financial literacy and business knowhow that means CAs are well placed to guide firms through tumultuous times. At ICAS, and my work with KPMG, I am fortunate to witness these skills on a daily basis.
The easing of lockdown restrictions has many hoping that the pandemic is consigned to the past – something from which we can simply move on. It is an uncomfortable truth that, whatever the immediate health outcomes, the economic impacts of the crisis have only just begun to reveal themselves. Companies and governments across the world have taken on enormous levels of debt in order to keep businesses and individuals afloat, and, at some point, repayments will loom. This may sound pessimistic, but it is simply a new set of challenges to which, I am certain, professionals will rise. We have already demonstrated enormous resilience since the pandemic escalated – and it wasn’t all that long ago that we tackled another great economic crisis.
During my secondment to Chicago between 2009 and 2011, I gained first-hand experience of the wide-ranging impacts of an economic recession and how quickly professionals can mobilise to speed up the journey of recovery. The United States, and Chicago in particular, was hard hit by the 2008 financial crash.
Businesses were shuttered, jobs were lost, and the economy soon stalled. The impact on society of such a dramatic reversal in fortune cannot be understated. As we’re all keenly aware, the numbers only ever tell a very small part of a broad tapestry. People were badly bruised by the downturn – it felt like forces outside their control had erased years of hard work.
At that time, it may have been tempting to accept defeat. Instead, as I lived and worked in a city shaken by a deep recession, I witnessed the emergence of a fighting spirit and an unshakeable desire to bounce back. When times get tough, people get tougher. It’s the same tenacity that I anticipate will carry us through the repercussions of COVID-19 and act as the keystone of recovery. As highlighted in this magazine, the rapid, creative and thoughtful responses to the escalation of the pandemic have served as a powerful reminder of what we are all capable of achieving in a crisis.
When talking to businesses, I share some common lessons which can be used across sector and scale. Plan across multiple time horizons when setting strategy. Place emphasis on long-term competitiveness when engaging with investors. Consider all stakeholders’ interests in decision-making processes. Align decisions to broader company purpose and values. Finally, regularly assess your firm against the three main pillars of resilience – operational, financial and commercial.
So, as lockdown measures lift – and hopefully stay lifted – and we begin to tackle a new set of challenges, I not only implore you all to keep your spirits and motivation high, but also to ensure that these lessons help to inform your actions. As finance professionals, the difficult economic times ahead offer yet another opportunity to demonstrate your skills and to build businesses that are stronger and more resilient than before.
This article first appeared in the July/August 2020 issue of CA magazine.