The only constant is change. Future competencies for finance and accounting

Challenges tied to AI solutions, ESG reporting, and Generation Z's values are reshaping finance sector strategies, competencies, and leadership. In an interview with Agnieszka Jarosz, Head of ACCA Northern and Eastern Europe, we explore the transformative impact of recent changes, associated with enhancing competencies, and aligning with evolving business dynamics.

Wiktor Doktór, Pro Progressio: With the rapid changes we've been witnessing across various industries, it's crucial to understand how these changes are impacting the finance sector. Could you please start by explaining the significance of the changes we've been observing lately?

Agnieszka Jarosz, ACCA Poland: Certainly. Recent times have brought about groundbreaking changes within just a few years. We've seen the emergence of the "Climate Clock" installed in 2020 New York and highlighting environmental concerns, which were previously often marginalised in public discourse. Now it has become one of the most popular topics in the media. In the same year, we experienced the global revolution brought about by the COVID-19 pandemic. Social issues such as gender equality, racism, and resource exploitation have also taken the spotlight.

Adding to these changes, we are painfully witnessing the consequences of armed conflicts. Furthermore, in 2023, widely available artificial intelligence-based tools rapidly began creating the content and images that surround us. Obviously our perspective on the world, the environment, social problems, and work has irreversibly changed.

How are these changes prompting companies to reassess their strategies and professional competencies?

The old slogan says that if a person stands still, they are moving backward. However, there is no more fitting description for today's pace of change in business. In such a dynamic environment, it is necessary to reassess our previous perception of company management and the way we build professional competencies.

A key moment for companies in redefining their business strategies has been the introduction of ESG reporting obligations. Issues such as environmental care, society, and responsible management have transitioned from being marginalised to being treated on par with financial reporting as a source of information about a company. It is now the time for finance and accounting departments to take the lead and, utilising the data and skills they possess, guide their organisations toward a new, more circular, and socially oriented economic model.

That's a critical shift indeed. How can professionals adapt to these changes and enhance their competencies?

As the possibilities of artificial intelligence expand, the need for professionalization is becoming even more pronounced. While basic tasks might be automated, the market is demanding higher -level qualifications that machines can't replace. This is where programs like ACCA come into play. These globally recognized qualifications, designed for financial specialists, offer advanced competencies that combine financial knowledge with a deep understanding of social and economic impacts, along with modern tools like optimization and artificial intelligence. It is necessary to raise qualifications beyond the basic level, which will be taken over by Machine Learning-related solutions.

Higher-level competencies that combine not only knowledge in finance, the impact of business decisions on the social and economic situation of the business environment, but also the skillful use of modern tools, including those related to optimisation and artificial intelligence, will be a distinguishing factor for companies in the market. Developing competencies and adapting procedures to technological capabilities will enable proper management of the company during turbulent times, including national and global crises.

Continuous learning seems crucial in this evolving landscape. How do you see the concept of lifelong learning evolving?

Lifelong learning is tightly intertwined with the need for continuous improvement in today's rapidly changing world. It's not just about building on existing expertise; it's about being open to interdisciplinary changes and exploring new trends and fields. With careers likely spanning multiple professions, professionals should focus on broadening their competencies horizontally as well as vertically.

It is worth emphasising that the latest research also shows a change in the process of lifelong learning. The traditional path is vertical, meaning we move forward and upward, deepening and expanding our existing expertise. The trend is moving towards horizontal and interdisciplinary changes. It is highly likely that during our lifetime, we will have several different professions. Openness to continuously expanding our competencies, not only within one career path but also by exploring trends and ways of functioning in seemingly unrelated fields, will impact the professional development of employees and the revenue growth of companies.

That makes a lot of sense. Now, let's discuss the emerging workforce, particularly Generation Z. How can companies align their objectives with the values of this generation?

The incoming Generation Z workforce may disrupt established organisational patterns, particularly in terms of their approach to combining work with a mission and making a real impact on change. The youngest generation of employees prioritises the values that come from work, not just financial benefits. Consequently, their interest in the finance profession, broadly understood, may decline if we fail to relate it to a broader social aspect. We are already observing a shrinking pool of candidates and increased competition in recruitment, both in the UK and across Europe.

Demonstrating a pro-social and pro-environmental direction of change in accounting and finance teams, such as through ESG reporting, can positively influence the attractiveness of the profession and attract talent. An important consideration when selecting a profession and employer is the perspective of professional development. Providing training, courses, and certifications to enhance skills can motivate both individuals entering the job market and those seeking opportunities for reskilling.

We observe this trend through participation in meetings at universities and companies, where ACCA is recognised as an important educational partner. ACCA-accredited programmes are highly popular in the academic environment. Throughout their studies, future financial professionals combine academic knowledge with practical professional skills. Frequently, employers also choose to recruit students from non-finance disciplines who possess other key skills, such as language proficiency, and provide them with comprehensive technical training. An example of this is the Diploma in Accounting and Business, a programme consisting of three key accounting and finance areas that enable the reskilling and integration of individuals who were not among the initial candidates.

In summary, managing teams based on values and the individual needs of their members is becoming increasingly important.

Is the necessity of integrating values into financial decision-making changing the roles of financial executives?

The role of financial executives is expanding beyond technical competencies. The traditional purely technical competencies of CFOs are no longer sufficient. To align business needs with the pursuit of zero emissions, social responsibility, and sustainable management, it will be necessary to redefine the goals set by financial departments. The responsibilities of CFOs will expand to include competencies related to relationship building and responsible management, transforming the current Chief Financial Officer (CFO) positions into Chief Value Officer (CVO) roles. Viewing numbers and the data accumulated within organisations as tools for creating positive change, not only within the company but also in society, is a crucial direction for companies aiming to be industry leaders. Building financial and non-financial reports appropriately and fostering close collaboration with other departments, such as the environmental department, will enable a more holistic approach and, consequently, better adaptation to market trends and changes.

Moreover, the CFOs serves as a key business partner to the board by providing strategic financial insights, guiding financial decision-making, and ensuring fiscal responsibility to achieve the organization's goals. They play a crucial role in driving growth, mitigating risks, and enhancing the overall financial health of the company. The emphasis on values and social impact is clear. Does this mean holistic team management has become a key component in successfully navigating the new business landscape?

As changes and new technologies take root, leadership needs to encompass various aspects. A leader should possess a holistic view of the organization. This entails recognizing the value hidden in data through comprehensive analysis and interpretation. The approach to team management also needs to reflect this holistic mindset. By understanding the individual needs of team members and aligning them with the organization's values, a leader can create a more cohesive and effective team.

What global changes and challenges are being faced by financial department managers in Poland?

Based on our latest quarterly report, the Global Economic Conditions Survey Report: Q2, 2023, it appears that only two regions of the world (out of the eight mentioned) do not regard economic inflation, recession, and interest rates as their primary risk priorities in 2023. These regions include the Caribbean countries and... Central and Eastern Europe. In our region, the most significant challenge is perceived to be problems with recruiting and retaining employees. This issue will particularly concern financial department managers, who are already grappling with the current labour market situation in Poland and the shortage of qualified individuals for the positions that need to be filled.

The second most prominent threat in our region is ongoing international and geopolitical instability. Unfortunately, the effects of the war in Ukraine are impacting and will continue to affect our country's economic situation, meaning that the situation beyond our eastern border cannot be underestimated by integrated financial departments, which should take this factor into account in their plans.

Thank you for sharing these invaluable insights.

This article comes from magazine:
FOCUS ON Business #12 September-October (5/2023)