Recent TRG blog posts

The world is changing fast, and so is the working environment of finance executives. Never before have the demands on finance been so great – or the stakes so high. Here are several mega-trends that are reshaping the role of finance organisations and transforming the careers of those in charge of them:

 The role of finance in today’s organisations requires a dual approach with finance trying to become more cost and process effective while aiding decision making and performance management. The finance function is evolving and collaborating more with other parts of the business to create further value.

 The role of finance in today’s organisations requires a dual approach with finance trying to become more cost and process effective while aiding decision making and performance management. The finance function is evolving and collaborating more with other parts of the business to create further value.

After two quarters of sharp declines, CFO optimism turned solidly positive in the first quarter of 2012, moreover, CFOs’ outlooks toward earnings, capital investment and even hiring – have improved; only one sticking point remains – sales.

After two quarters of sharp declines, CFO optimism turned solidly positive in the first quarter of 2012, moreover, CFOs’ outlooks toward earnings, capital investment and even hiring – have improved; only one sticking point remains – sales.

Most of the world’s 500 largest firms have extensive international operations; indeed, these firms average 35% of their sales in other countries. Finance officers and senior executives involved in strategic management usually assume that such firms are operating globally.

The finance function is a strategic one because it helps drive organizations to higher levels of performance by delivering information that enables key strategic decisions to be made. In addition to strategic planning, a well-run finance department supports sound financial management, organizational performance reporting, treasury-related activities, and financial reporting (among numerous other things). It tells you how many dollars are coming and going, and where they’re coming from and going to. Without that information, people are driving blindfolded, and the organization will have a difficult time building and then sustaining long-term value.

The phrase “corporate sustainability” remains open for definition. While some organizations appear more concerned with hashing out its meaning and relevance, others are moving forward with sustainability initiatives designed to satisfy stakeholders, cut costs, and, in a growing number of cases, generate shareholder value.

“A major part of our sustainability effort is to support our sales and marketing team in gaining access to new market segments, reinforcing our pricing strategies, and improving our customer mix so that there is a strong fit between our product offer and what different segments of the market value,” notes Lyn Brown, vice president corporate relations and social responsibility of Catalyst Paper.

A new report jointly produced by the American Institute of Certified Public Accountants (AICPA), Canadian Institute of Chartered Accountants (CICA), and UK-based Chartered Institute of Management Accountants (CIMA) sheds light on current sustainability practices. The 24-page report, “Evolution of Corporate Sustainability Practices,” suggests that corporate finance can and/or should play a central role in these efforts.

“Accuracy in measurement is an essential first step in the sustainability process,” says Steve Leffin, director of global sustainability for UPS. “In the short term, this accuracy enables you to understand if you are acting and reporting appropriately. Over the long term, customers, governments, and agencies are going to ask you for your sustainability numbers – via an accepted protocol and verified by third parties.”

The report presents a snapshot of current sustainability drivers and strategy; sustainability programs and their scope; measurement approaches; and the finance function’s involvement in corporate sustainability.

While Europeans have long had to adapt to working in many languages, currencies and legal jurisdictions, a generation ago most midsize companies in the United States did all their business in their home country and in U.S. dollars. Today, though, the relentless globalization of the world economy means that an increasing number of midsize companies in North America are functionally multinational and face the challenges of managing a more complex and demanding accounting and financial management function.

While Europeans have long had to adapt to working in many languages, currencies and legal jurisdictions, a generation ago most midsize companies in the United States did all their business in their home country and in U.S. dollars. Today, though, the relentless globalization of the world economy means that an increasing number of midsize companies in North America are functionally multinational and face the challenges of managing a more complex and demanding accounting and financial management function.