the finance professional 2020-acca
TRANSCRIPT
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Insights series
The finance professional in 2020
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Foreword 2
Introduction 3
Executive summary 4
Key drivers 6
Key features and trends 9
Conclusions and final thoughts 16
Acknowledgements and bibliography 18
Contents
Welcome to our Insights series. We recognisethe importance you place on having an
opportunity to explore, reflect and plan
for managing the impacts of current and
anticipated challenges and opportunities.
Our Insights series of reports are intended to provide you with that space
and an insight on the key issues for the profession and employers and how
they are responding to them. Very often our reports will involve a survey of
the profession plus a review of existing research, so as to ensure you aregetting a balanced and comprehensive picture.
Our intention is that the series should reflect your challenges and your issues.
So, we would be pleased to hear from you, either specifically in response to
this report or indeed, on any other key issues of interest. Happy reading and
reflecting!
Best wishes
Stephen HeathcoteDirector of Learning and Development
PAGE
About ACCA
ACCA (the Association
of Chartered Certified
Accountants) is the largest
and fastest-growing
international accountancy
body with 260,000
students and 110,000
members in 170 countries.
We aim to offer the first
choice qualifications to
people of application,ability and ambition
around the world who
seek a rewarding career in
accountancy, finance and
management. ACCA works
to achieve and promote
the highest professional,
ethical and governance
standards and advance the
public interest.
www.accaglobal.com
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Introduction
The finance professional in 2020 is a thought leadership piece
around the future landscape for the finance professional. The research
identifies the drivers and future trends which are likely to shape the
profession, the individuals within it and their employers.
The research is relevant to the profession in that it will
support the change process required to respond to the
trends identified.
The objectives of this thought piece are to:
Identify key global trends that will shape the finance
profession
Understand the skills and knowledge likely to be
required of the finance professional of the future
Identify likely career structures of the future
Stimulate debate around trends and responses.
In order to obtain a comprehensive understanding of
the trends and issues the research was conducted
through:
Qualitative telephone interviews with 20
professionals from a range of sectors and roles (see
profiles below)
A review of existing literature, including existing
global surveys from ACCA and other sources,
academic papers, thought leadership papers and
other reference material
Excerpts from a recent ACCA survey on Talent
Management (Oct 2006), 2004 Skills Survey and
the 25,000 respondent consultation on the ACCA
2007 Professional Qualification.
A qualitative approach was used to ensure depth of
insight, encouraging participants to explore the issues
in detail and offer personal insights and examples.
Great care was taken in the selection of participants to
secure a breadth of coverage and appropriate mix of
profiles.
Pae Pfe
CFO, global bank
Chief executive, global finance training providerChief executive, professional services, not for profit
CPD national manager, global finance training company
Director of education and training, not for profit
Finance manager, private healthcare
Finance manager, public sector
Former head of finance training, global energy company
Head of global finance training, global energy company
Head of organisational learning, global bank
Independent finance researcher
Professor of accounting
Project manager, financial services
Senior executive, finance planning, global energy
company
Senior finance consultant
Senior finance manager, global bank
Senior independent finance HR specialist
Small-business finance expert
Talent manager, global finance, global energy company
Training and development partner, accountancy firm
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Executive summary
The finance professional in 2020 will be faced with a number of
challenges and opportunities shaped by the forces of enhanced
globalisation, changing demographics and significantly increased
business complexity.
The BRIC countries (Brazil, Russia, India and China)
are expected to have established themselves as
significant economic powers and this will shift thebalance of economic power, particularly as those
economies move from competing on cost to competing
on the basis of knowledge and innovation.
There was a general consensus that the convergence
of fast-changing technologies, fragmented consumer
tastes, ever longer supply chain and multiple dimension
supply chain relationships will create an environment
which is a more complex place to do business,
with increased risk. As one of the participants put it
Complexity breeds risk, risk breeds regulation, which
in turn requires further investment in compliance. It is
feared that such an environment could see the death of
professional judgement, to be replaced by rules-based
regimes. However, it is forecast that this generally
higher and more pervasive risk will drive innovative
mitigating measures, which will in turn bring more
simplicity.
KEy trEnds to WAtCh
Ga ama f ega
There was widespread optimism that International
Financial Reporting Standards (IFRS) would be adopted
across the major economies but there was significant
scepticism as to whether they would be implemented
and followed. Nonetheless, the general view was that
successful implementation of IFRS would lead to
initiatives to harmonise compliance, regulation and
auditing standards.
Mc ae faca epg
Financial reporting is expected to remain at the
heart of the profession (81% of ACCA members seefinancial reporting as one of the four most important
competences). Demands from ever more savvy and
diverse investors, demand for greater transparency and
free access to information plus the rise of intangible
assets, are expected to drive organisations into
reporting on broader measures. These could include
sustainability, risk, corporate governance and human
capital. This will require finance professionals to
develop new and innovative means of measurement
and reporting, together with the requisite skills and
methodologies.
te paa a fagmea f face e
It is expected that over the next 15 years, finance roles
will further polarise and fragment.
Polarisation will develop across two dimensions,
namely:
The generalist v the specialist and,
The value add professional v the transaction
technician.
Specialist niche roles will initially be highly prized
and valued but over time such roles could lose their
allure as they become commoditised and probably
automated. However, there will still be value attached
to the generalists, based on their understanding of
a broad range of issues. As complexity will be a key
feature of this environment, so will the demand for
the professional who can provide a strategic overview,
decision making and direction. That person will be
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Executive summary
capable of exercising fine professional judgement,
particularly in dealing with the risks (defined as
opportunity and danger) present.
This polarisation will be driven by the needs of
organisations to manage complexity, reduce cost and
utilise their finance professionals in areas where they
can add most value. Roles such as those below may
begin to evolve:
the naga (a generalist who helps the
organisation steer through complexity)
the Ce (a risk specialist who pervades all
parts of the organisation)
the Eepee (a leader who seeks opportunities
and maximises value)
the tecca peca (a professional with a highly
discrete specialism)
the t-ape pfea (a professional with
broad generalist technical and business knowledge,
complemented by a deep specialism)
the tecca (a non-professional with a process-
driven role).
te gw a eepme f ae maageme
pgamme
Adverse demographics in developed countries will
create a scarcity of talented finance professionals,
thereby driving up their value, but this could be
addressed through the employment of finance
professionals in the BRIC countries, for example,
through immigration or offshoring. However, the surveydid demonstrate that employers still have some work
to do in ensuring they have the human capital required
for business success. 59% saw talent management
as being a means of recruiting, developing and
retaining people in an organisation who have high
potential; 76% recognised it was very important; 63%
appreciated the negative impact that would arise by
not having a talent management strategy but 41% had
no strategy and no plans to implement one.
te k a ae eee f e ew
eme
The anticipated development of roles and of the
finance function will drive the skills, knowledge
and attributes required by the finance professional.
Areas already being promoted, developed and offered
by ACCA (the ACCA Professional Qualification,
continuing professional development (CPD), Career
Pathways), feature quite strongly. The ability to
exercise professional judgement based on a foundation
of ethics, broad but deep technical excellence plus
strategic awareness and communication will be key.
2020 could also see the advent of the T-shaped
professional, that is, an individual with broad generalist
finance knowledge and strategy skills complemented
with a deep technical specialism in, for example, risk
or financial reporting.
It is anticipated that finance professionals will
develop a portfolio of roles throughout their career,
most of which will reach across multiple parts of the
organisation. Additionally, the ability to manage in an
uncertain and complex, ambiguous environment, idea
sharing and an ability to learn through experience, will
be the most sought-after attributes.
te e f e face fc
The finance function is expected to develop into a more
central role, providing strategic and risk management
advice to all parts of the organisation, from operations
to marketing. It will continue its evolution from afunction focused on transactions into decision-making
support and finally, will adopt the leadership role of the
organisation.
It will focus highly on knowledge and use this as a
means of identifying and creating value throughout
the organisation. Its extensive knowledge of the
organisation will further support this.
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Key drivers: globalisation, demography, complexity and risk
Respondents generally agree on the emergence of the BRIC countries
(Brazil, Russia, India and China) as having a major impact on future
global growth. That growth is not expected to occur in a straight line
as those economies will pass through the same development cycle as
have the developed economies. Problems for economic development
are likely to be exacerbated by migration of talent. To take advantage
of this trend it is expected that China and India will initially competefor business as educational hubs for the profession, acting as major
suppliers of the worlds finance professionals.
We can, however, expect the locus of financial power
to shift, providing greater balance, as business activity
and income levels increase (for example, in China by
2020 the estimated number of Chinese households
achieving European-level incomes will be 100
million1).
In time we may also see emerging economies moving
beyond their role as educational hubs and providers
of low cost shared service centres (SSCs). We may
expect these economies to challenge for a share of
more complex transactional and non-transactional
services enabled through development in services and
technology.
While emergence of the BRIC countries will mean
increased markets and opportunities for business and
the profession, this growth will take place within the
context of a shortage of natural resources. Additionally,
cultural differences may lead some economies to
challenge the dominant Western approach to business,
ethics and accounting.
If we consider the two big players,
which will take better advantage of
this growth potential, India or China?
China will, in the short term, need
to establish better governance andaddress issues around intellectual
property and quality. Will Indias
English language advantage and more
internationally understood legal system
prove the deciding factors?
Regulatory
harmonisation
Regulation
compliance
scrutinyBroad FR
Skills for
the future
Evolution of the
finance function
Talent
management
Role polarisation
Gaa
Cmpex
demgap
1 Ten trends to watch in 2006, McKinsey
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Key drivers: globalisation, demography, complexity and risk
The developed economies
are now experiencing adverse
demographics in the form of
falling birth rates and ageing
populations. Will this lead to
a shortage in qualified finance
professionals and how will this
impact the world economy,
the profession and individuals
prospects?
The most commonly held
view, which we would concur
with, is that there is unlikely
to be a long-term shortage of
professionals. Falling populations
in developed countries are likely
to be balanced by increased
geographic mobility, particularly
from emerging economies, and an
overall reduction in the required
qualified headcount driven by
role polarisation, offshoring and
technological innovation. In the
mid-to long-term, market forces
and increased educational opportunities are expected
to balance supply and demand.
Supply of adequate talent could also be assisted by
more flexible employment practices, which support
professionals in extending their career beyondtraditional retirement age and encourage existing non-
working qualifieds, for example career breakers, to
return to the profession. As a result, organisations will
need to develop more innovative ways to recruit and
retain people into the profession and to develop them
within what is likely to be a more specialised finance
environment.
What will be the impact on those emerging economies?
In the short term we may see a similar situation as has
arisen with the migration of healthcare professionals to
Europe and the US, attracted by
salaries unachievable at home.
In turn, emerging economies may
focus on strategies to redress
the imbalance by encouraging
inward migration and deploying
strategies to retain their best
people.
There is a wide consensus that
the future environment will
become increasingly complex.
If the current concern regarding
geopolitical and environmental
issues proves founded there will,
of course, be an inevitable impact
on the business environment. And
surely the future growth of trans-
national organisations and global
trade is another strong argument
for anticipating greater complexity
and risk?
Complexity drivers to emerge
from the research include:
The ever increasing pace of technological change
Competition for customers leading to more diverse
and fragmented services and products
Longer and more inter-dependent supply chains
Regulation
New business models Access to, and competition for, emerging markets.
Complexity leads to less doing,
more thinking.
se face hr peca
A recent CIPD survey
found that 15% of UK
organisations are
targeting migrant
workers from the EU.
Financial Services
company Standard Life
has scrapped its
retirement age from
October 2006 ahead of
UK age discrimination
regulations. Employees
will be able to choose
when they stop work.
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Simplicity drivers
Complexity drivers
A consequence of a more complex future is a growth in
specialisation for finance professionals. This is explored
below but here it is useful to point out that risk itself
may become an even higher-profile specialism than at
present, with a larger number of organisations co-locating risk management activities which are presently
dispersed across finance, HR, operations and strategy
functions.
A further consequence of increased complexity is an
increased emphasis on governance. There will be a
drive to deploy governance structures that prioritise
and systematically assess risk. To enable these
structures, professionals are likely to require a broader
knowledge of the business and its environment.
However, if increased regulation and complexity has
led to increased specialisation, these individuals may
become a scarce resource. If greater complexity occurs
alongside increased regulation, we may see the talent
pool shrink further as the focus for resource shifts to
compliance, leaving less scope for strategic thinking.
If complexity breeds risk and risk breeds greater
compliance, a challenge to the profession, professional
bodies and employers will be how to ensure that the
compliance/strategy skills gap is managed.
There seems to be a trend
towards Government seeking to
use the accountancy profession
as its agent, placing obligations
to disclose information, report
money laundering etc.se epee face ca
An alternative, though minority, view to emerge from
the research is that there will be no greater complexity
than now. The response to complexity is often greater
innovation, which makes the complex simple once
more. Technological advances including intelligentsystems are beginning to perform this function and
are likely to be refined and adopted over the coming
years. If implementation proves successful, intelligent
systems are likely to have the same effect that
improved risk management has had, that is, better
management of risk and complexity.
Lastly, as discussed below, greater role specialisation
may result from the need to manage complexity and be
seen as a means of mitigating risks that may arise from
lack of competence or knowledge.
Key drivers: globalisation, demography, complexity and risk
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Key features and trends
We found seven clear trends, each of which would impact the finance
professionals, their employers and the profession generally. The
common message is that the environment will drive significant changes
in the way organisations view the roles of finance professionals,
the skills and attributes they require and how risk is perceived.
Consequently, ACCA remains committed to providing the frameworks,
organisational development support, qualifications and learningopportunities to help the profession and its employers meet the future
challenges and opportunities.
rEGulAtion. CoMPliAnCE. sCrutiny
This decade has so far seen an unprecedented focus
on and scrutiny of business and finance activities. The
reasons are well rehearsed and the consequences in
the form of increased regulation and greater emphasis
on compliance work have had an enormous impact on
the business landscape in which we operate.
But is this focus a temporary aberration or a permanent
feature of the landscape? Or are we at one extreme
of the business cycle, which will revert once more to
greater liberalisation and looser regulation?
Opinion is divided as to whether regulation will
continue to tighten or slacken off.
There will be a retreat from the
current regulatory framework
which is too extreme and driving
people out of capital markets
into private equity.
Maagg ec, ga faca ag pe
If we accept that current regulation has been driven by
recent accountancy scandals we must ask will there
be more such scandals? If we assume yes, we may
expect to see a further increase in regulation leading to a
greater focus on compliance work. If a more rules-based
approach becomes dominant it may be that applying
the concept of true and fair becomes less important to
the work of the finance professional. The diminution of
professional discretion may mean some roles present less
of an intellectual challenge, which may in turn, dissuade
talented individuals from entering the profession.
On the other hand some argue that there is no going
back. But what would drive a backshift? If companies
move to less regulated markets? If private equity
continues to grow?
Under either scenario the debate about the natureof regulation (rules or principles-based) is likely to
continue. In a multifaceted complex environment the
application of professional judgement has a vital role
to play, as rules-based systems will be ill fitted to an
uncertain and complex environment.
Our view is that the current regulatory position is
likely to remain, with neither a discernable increase or
decrease. However, we can see professionals becoming
even more adept at managing the regulatory maze and
in time being able to delegate this activity to non-
professionally qualified technicians.
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Key features and trends
rEGulAtory hArMonisAtion
Our research indicates
widespread optimism on the
harmonisation of accounting
standards. It is generally agreed
that IFRS will be widely adopted
by the major developing and
developed economies, albeit with
highly uncertain timescales. It is
commonly felt that resistance is
likely to continue from developed
economies, which may well slow international
implementation. In contrast, we may see the BRIC
countries driving adoption of international standards
and in turn bringing the developed countries with them.
Market forces may also drive harmonisation. An example
might be the merger of stock exchanges. However, in a
contrasting view, some respondents operating in global
business indicated a belief that implementation was
already slowing down and that the need for harmonisation
is increasingly being questioned.
There is some caution being expressed about just
how deep the adoption would run. While it was felt
standards would be beneficial and generally adopted,
it was also agreed they would not necessarily be
applied consistently, particularly in economies with less
transparent regulation. The consequences? We may see
national regulators sharing information and converging,
perhaps on a regional basis, and even extending their
reach into territories not currently regulated.
They will adopt IFRS but will
they use it?
Pfe f accg
Another potential consequence of greater regulation
and convergence of standards is accounting industry
consolidation. This may see the rise of global firms
from China (developed to support the global ambitions
of Chinese industrial champions)
and/or a consolidation of smaller
firms, to challenge the Big 4
and bring more choice into the
market.
FinAnCiAl rEPortinG
Reporting will continue to be
at the heart of the finance
functions work. The nature of
the reporting, however, is likely to
continue to broaden. For external reporting, corporate
social responsibility (CSR), corporate governance,
environmental impact including carbon emissions, and
human capital metrics are all likely to feature and will
become the standard rather than the exception.
Increased scrutiny, a drive towards transparency,
freedom of information, free movement of information
and better educated populations will extend the scope
of reporting. Producing intelligible reporting from a
greater number of sources with more complexity for
multiple audiences will be a formidable task. The
continued development of communication technologies
and populations more inclined to take direct action in
the form of, for example, product boycotts, will increase
the need for transparency and simplicity in reporting,
albeit on a more complex picture.
We see that tomorrows global professional accountants
will face an ever increasing set of competing valuesand complexity in the business environment. They will
face increasing demands from investors to improve
financial returns and measure and report on forward-
looking indicators. Given that financial markets survive
and thrive on accurate and freely available information,
the integrity of those who prepare that information is
paramount. The ability to exercise judgement based on
ethics will be the one constant that will ensure finance
professionals maintain that integrity and successfully
circumnavigate complexity and ethical dilemmas.
Indeed, our 2007 Professional Qualification, with an
81% of members
consider financial
reporting one of the
four most important
competences in their
current role.
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Key features and trends
all pervasive ethics approach and
specific subject areas entitled
The Professional Accountant and
Accountant in Business, is aimed
at preparing the next generation
for this.
rolE PolArisAtion And
FrAGMEntAtion
We expect to see increasing
polarisation and fragmentation
of roles in the profession. This
polarisation is likely to be
evidenced along two dimensions:
the value add professional v the
transaction technician and the
generalist v the specialist.
dme 1 te ae a
pfea e aac
ecca
More specialisms, fewer daily
transaction activities
hea f face ag, ga cmpa
While this trend is firmly in evidence today, many
participants indicated there was likely to be a
broadening of both the tendency for separation
of transactional work from higher-value work andadditionally, an increase in what will be classified as
transactional work.
Availability of lower-cost qualified professionals
through offshoring; the possible increased use of part-
qualifieds for transactional work; automation enabled
by advances in accounting technology, including the
deployment of Extensible Business Reporting Language
(XBRL), are all strong drivers for this polarisation.
Consequently there will be an increasing tendency for
most transactional work to be undertaken by SSCs,
leaving the finance function to
manage the relationship and
risk with the SSC and shift
focus to other areas such as
strategy, niche specialisms and
organisational leadership.
And what will be classified as
transactional work by 2020?
Respondents suggest that some
work which is currently regarded
as specialised will, by then, be
supported by technologies and
will require a lesser degree of
human intervention. Indeed,
we might expect to see a cycle
in which specialist roles are
initially highly prized, but over
time become more mainstream,
transactional and are valued less.
What will be the business impact of this
commoditisation of finance activities? Presently SSCs in
developing countries are focused on the transactional
activity considered low margin by organisations in the
developed economies. Will this migration of activity
continue with high-value services? Many would suggest
that with their strong and deep skills base, developing
countries will acquire a greater share of more complex
work and play a significant part in speeding up the
pace by which such specialist work is commoditised.
dme te geea e peca
A key driver toward specialisation will be increased
regulation and attendant complexity and compliance.
Assuming regulation does increase, specialisation
will also require greater focus on technical skills
development. Professional bodies and businesses will
be required to respond with development and delivery
of technical learning options in a broader range of more
specialised areas.
87% of ACCA students
consider integrity and
professional ethics as
first in the list of core
skills for the future
finance professional.
In the same survey
67% viewed credibility
of the profession as a
long-term issue.
(Source: ACCA student aspirations
survey, 2004)
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PAGE 1
For the profession as a whole, well grounded technical
financial knowledge and skills will remain highly
relevant. For one group, those post-qualification skills
will be increasingly focused into narrow specialisms.
Unchecked, this may present a problem for leadership
development and succession. If professionals are
forced to specialise more intensively and earlier in their
careers it may be difficult to provide the individual
with the high-level view required for more strategic
leadership. If this is the case, should we now be
developing the rather paradoxical specialist role of the
generalist, as great value may be placed on leadership
and the ability to see the big picture?
We can see the evolution of six major roles in this
future environment:
the naga (a generalist who helps the
organisation steer through complexity)
the Ce (a risk specialist who pervades all
parts of the organisation)
the Eepee (a leader who seeks opportunities
and maximises value)
the tecca peca (a professional with a
highly discrete specialism)
the t-ape professional (a professional with
broad generalist technical and business knowledge,
complemented by a deep specialism)
the tecca (a non-professional with a process
driven role)
How might the trend to specialisation affect theaudit profession? If we assume the same drivers to
specialisation exist for auditing as for other finance
activity, we may see audit reports becoming a
collection of specialised reports from a variety of
sources, perhaps even from outside the main auditors.
There may well be a growth of auditing of internal
reporting and the profession may focus on high-value
activity like valuation and reporting on CSR, corporate
governance and strategy. The result of this increased
demand for more and broader auditing may mean the
blurring of the distinctions between the finance function
and other functions of a business. Indeed, we may find
the finance function, or at least some of its traditional
activity, relocated and embedded into those other
functions.
It has also been suggested that the increased
complexity of organisations may require a continuous
auditing regime in which the auditors are situated
in the business all year round. However, the risk of
jeopardising objectivity and independence will have to
be considered.
An alternative suggestion was for would-be auditors to
undergo two years work experience before embarking
on their professional qualification to ensure they have
acquired the sound business experience required in
order to conduct their assignments effectively.
thE AvAilAbility oF tAlEnt
Talent issues are likely to come to the fore as the
profession continues to develop in response to the
changing business environment. The areas most
likely to occupy those involved in recruiting, retaining
and developing talent are: drawing advantage from
increased mobility; the opportunities and challenges
of greater diversity; demand for flexible employment
models; the need for new and the more specialised
skills. It will be imperative for educators, professionals
and employers alike, to work together in ensuring that
the relevant guidance, support and resources are made
available for the development of the next generation offinance professionals.
Increased mobility of professionals offers significant
opportunities for developed and developing countries
alike. The research suggests a continued migration
of more highly skilled knowledge-based workers
to the developed countries. This move is likely to
be supported by harmonisation of accountancy
standards and accountancy education including,
crucially, harmonisation of ethical standards. However,
technology may act as a balance, with more work
Key features and trends
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PAGE 1
itself being migrated to lower-cost economies, allowing
those professionals to stay in their home countries.
Nevertheless, the most talented individuals from
developing countries are likely to benefit the most, with
competition for high-potential candidates increasing
ever more as the talent pool within the developed
economies shrinks due to static or negative populationgrowth. But will this talent stay? In the longer term
will we see talent returning to its country of origin
as economies mature and opportunities there grow?
Our experience would indicate that once people have
acquired sound experience, they will tend to return
home, thereby providing those economies with a highly
talented resource.
The picture painted above is clearly one of increased
diversity within the profession. We can also expect
changes in the way people work. The promise of
virtual working may finally become a reality. This may,
to some extent, mitigate the migration of professionals.
Also, we can expect to see professionals swapping
between full time, part time, contract and permanent
positions at different points in their career. Increasing
specialisation could be a driver for this if these skills
are only required for limited periods by businesses. We
may see the growth of the individual and independent
professional.
What are the skills required for the individual to
succeed? At the strategic level, communication and
leadership will remain key. It is likely that succession
planning will be increasingly important. With a highly
mobile profession, and potential shortage of strategic
thinkers, managing employee motivation is likely to be
key to successful retention of the best people.
For HR this scenario presents a number of challenges:
recruiting from new markets, balancing cultural
expectations, professional development and retaining
talented individuals. And what skills will HR and
the profession be looking for? Specialised technical
knowledge will be a given, alongside which will
sit flexibility, potential to think strategically and
yet understand the limits of ones own knowledge
but also be highly skilled in accessing and filtering
relevant information a profile akin to the T-shaped
professional role class. Finding the highest-potential
candidates in a more distributed talent pool of more
specialised individuals may require more sophisticatedmethods than are commonly employed at present.
The credibility and appeal behind an employers brand
will also play a key part in attracting young talent, who
will seek alignment between the values of an employer
and their personal values. Sustainable business
reflecting the concerns of society may help to attract
and retain people longer. They are also likely to seek
intellectual challenge, flexibility and opportunity for
career advancement.
Key features and trends
W ee tae Maageme
ceae e fe?
100
80
60
40
20
0
Increase
Staysame
Decrease
Dontknow
Source: Talent Management in the Finance Profession:
Global Survey Report 2006, ACCA 2006
%o
frespondents
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sKills And AttributEs For thE FuturE
EnvironMEnt
The finance professional, in 2020 will require a
rigorous and broad technical foundation linked with
work experience. They will require sound professional
judgement and ethics, which will further differentiate
the qualified from the unqualified and determine their
capabilities and opportunities.
While we expect to see greater role fragmentation, we
also expect to see these role profiles sharing some of
the same skills and attributes but with the difference
coming in the focus of each role. Similarly, we would
expect valued professionals to have held several roles
throughout their careers. The illustration below seeks to
outline the evolution of skills and attributes required for
the future.
Key features and trends
Wa we ae w Wa we ee f e fe
team pae Team player, coach and mentor support and lead teams as appropriate, aid the experiential
development of upcoming professionals.
G f f e Broader range of skills plus the flexibility to reinvent oneself in a range of roles. More creativity, idea
sharing and lateral thinking.
speca k A new range of role profiles built around a sound, general technical background but with a specific focus.The T-shaped professional, the navigator, the entrepreneur, the technical specialist and the centurion.
rg f me g Excellent execution (right first time) combined with a willingness to experiment and learn.
accac, me
Pce fc Outcomes focus greater weighting placed on what organisational outcomes and output measures are
required (as opposed to designing the process).
opeaa Strategic.
Cme ee Customer intimacy closer internal and external relationships in order to understand and align mutual
needs.
Wkg Greater collaboration and challenge with all parts of the organisation and customers.
thE Evolution oF thE FinAnCE FunCtion
In the short to medium term the finance function
is expected to complete its transformation from
a transaction-processing focus to a fully fledged
business partner with a high decision support
capability. However, the finance function in 2020
may also have assumed a leadership role throughout
the organisation, primarily due to the extent of its
organisational knowledge and influence. In this role it
will assume responsibility for strategy development and
implementation as well as managing the risks that may
impact the future success of the enterprise.
Risk should increasingly be seen as both danger and
opportunity. It ought to be viewed and managed
across a wider range of areas to include people and
intellectual property. In essence, the management of
risk, in its interpretation as opportunity and danger,
should become part of the strategic process. In the
future we anticipate that finance professionals with
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their training, experience and broad organisational
perspective will assume leadership of the organisation.
Finance could become the new
strategy function
Faca ce,
ga faca ece gaa
Key areas such as Financial Reporting, Management
Information, Treasury and Corporate Finance, are
expected to remain and flourish.
However, a less optimistic view (and one we dont
subscribe to) is that of a finance profession more highly
regulated and more narrow in scope than now, where
much specialised work can be automated and a smaller
pool of strategic thinkers oversee activities and plan the
future. This narrow focus could make the professionless attractive to the graduate and consequently stunt
the potential for innovation.
Key features and trends
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Organisations need to consider the risks around ensuring that they
have the right people, with the right skills, knowledge and expertise, in
the right roles and within the right organisational structure.
Conclusions and final thoughts
Focusing, retaining and developing what drives and
protects value is key. The finance function of the future
will develop around:
Leadership, strategy and change
Risk and compliance
Finance specialisms
Managing outsourced functions.
Organisations should link finance skills development to
the roles that will drive value. Suggested role classes
include:
The Navigator
The Entrepreneur
The Centurion
The Technical specialist The T-shaped professional
The Technician
In tomorrows fast-evolving, complex environment,
finance functions should be the champions of change.
Our perception of risk should change, so that it
encompasses danger and opportunity and to recognise
its increasing pervasiveness.
In a complex environment, the ability to exercise sound
professional judgement will provide the flexibility and
the skill of simplifying complex, multi-dimensional
issues. The core attributes of professional judgement,
technical excellence and ethics, should continue to be
protected and promoted.
At the heart of being a professional is the duty to
uphold the public interest above ones own and
to make accurate judgements based on acquired
knowledge, skills, expertise and experience. This is
knowledge that is regularly updated and skills that
are regularly refreshed and developed. For finance
professionals, the independent exercise of judgement,
based around ethical values and technical skills is the
key to their current and future role. This will continue
to be supported by our approach to professional
work experience, which seeks to ensure that trainee
accountants have exposure to and an opportunity to
learn from real life dilemmas, while under supervision.
Todays professional accountant operates in an
environment of time-and space-reducing technologies
with an increased emphasis on ethics and corporate
governance and demand for new, value adding
services. With greater automation and processing,the role of a professional accountant has evolved into
one focused on managing uncertainty, complexity and
strategic decision-making within an overall context of
heightened governance. The attributes possessed by
professional accountants facilitate entrepreneurship,
help managers create value, manage risk and help us
rationalise complexity. This is the role of the 21st-
century professional.
Going forward, we would urge the profession,
organisations and finance professionals to consider how
they might prepare for 2020. The following questions
might be useful to help formulate some thoughts:
To what extent would complexity impact my
organisation and its customers and what would this
mean for our finance function or clients?
What are the value levers in my organisation (or that
of my clients) and how do we ensure that finance
professionals are focused on leveraging these? Do
we outsource our other activities or move them to a
shared environment?
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What role would risk play? Do we need to consider
risk at a more strategic and pervasive level?
What capabilities might we need and which role
types might we need?
How can we mitigate the risks associated with a
dearth of talent?
And additionally:
How do you see your role (and/or those you
manage) evolving as we approach 2020?
What steps would you need to take to make that
transition?
Do you consider that any of the role classes we
suggest would be relevant to you (and/or those you
manage)? And if so, what roles do you (and/or those
you manage) need to develop towards?
We welcome your thoughts and views on this subject.
Please contact us by e-mailing [email protected]
Conclusions and final thoughts
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Acknowledgements and bibliography
ACCA wishes to extend its gratitude to all those individuals who
responded to this survey.
Particular thanks is due to the expert panel, consisting
of senior industry and academic figures, for giving their
time so generously in support of this project.
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