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The word ‘rollercoaster’ best sums up 2023. We’ve experienced economic, geopolitical, technological, and societal challenges over recent months with the ongoing cost-of-living crisis, high interest rates, inflation, global conflicts, catastrophic weather events, the rise in artificial intelligence such as ChatGPT, to name only a few. All of these elements have put pressure on the financial services industry (FSIs), pulling its focus in different (and often complex) directions to solve problems that didn’t exist a year ago. Read the full article at: blogs.opentext.com
Now more than ever, the customer is king, and financial services organisations need to be able to cater to changing demand. Unfortunately, a skills shortage to handle digital transformation has exacerbated the challenge. This is driven by a lack of qualified talent to fill new IT roles, and a millennial workforce that shuns long-term employment. As parts of the world begin to emerge from the peak of the Covid-19 pandemic, the strategic focus is turning to what the competitive landscape will look like in the aftermath. It is also essential for leaders to realise what the new reality means for them and how to come out in front. The financial services sector has to cope with drastic shifts in consumer behaviour, and the pressure is on to provide the kind of services that customers are beginning to demand. While digitalisation has solved some challenges, it has created many new ones in its wake, and success rides on the ability of financial services to address these issues in the new business reality.
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A career in finance isn't all about money, though it starts there. For the business graduate, earning a degree is just the beginning. What's left is to take a closer look at the available career options and then to measure which industry sectors have the greatest need for new professionals. It's also important to consider your own interests and strengths as you discern the type of work that you'd enjoy and at which you would excel. The Financial Services Industry The financial services industry is multifaceted, offering a variety of positions that cater to different skills and interests, along with sub-industries that encompass niche opportunities. Researching the possibilities in financial services will help you to land the job that has is most compatible with your interests and skills. The same is true for professionals who are seeking a career change and who want to give a new sector a shot. The sectors below represent some of the more common career paths in the financial services industry.
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What advice do the top women in finance have for those trying to make their way in the sector? Last year, I interviewed 50 accomplished women from around the world for my 2020 research paper “Top Tips for Business Success,” released on International Women’s Day, 8 March 2020. As it turns out, five of the women are CFA charterholders and all hail from different countries. They each have charted unique paths to get to where they are today. And in celebration of International Women’s Day, I thought I’d share some of their top tips and insights about what they see as the ingredients to their success. 1. Be curious! Cathy Hwang, CFA, principal, Zumaya Equity, Taipei. “In the early years of my career, I decided to pursue an analyst job with one of the big banks (on a whim!) even though I wasn’t as prepared as I should have been for the interview. I recall having an out-of-body experience during the interview and thinking ‘Oh my God, this is going really terribly!’ “The recruiting team conducting the interviews was seeing 12 candidates a day and they expected everyone to recite all of the standard answers to investment banking interviews. During my interview, I somehow ended up talking about the book Freakonomics that had inspired my decision to study economics. For some reason, my story resonated with the guy who was interviewing me. “Although I wasn’t hired for that particular job, he liked me enough to set me up with someone who could help me prepare for future interviews. I stayed in touch with both of these contacts and our paths have crossed many times over the years. We share information. I have always been generous about sharing because, if you think about it, What does all of that information actually do for you if you keep it to yourself? I love that Derek Sivers quote, ‘If [more] information was the answer, then we’d all be billionaires with perfect abs.’ “My advice is definitely to stay open-minded, share information, and most of all . . . be curious. Especially if you are in the business of investing. Be fundamentally curious about the world — whether it’s about travelling to interesting places, interacting with different types of people, seeking out new experiences, or being disciplined about reading diverse publications. You need to have a wide lens for information flow.” 2. Your network matters! Blair DuQuesnay, CFA, investment advisor, Ritholtz Wealth Management, New Orleans. “Business turned out to be a great fit for me from the time that I started. My first job was sales assistant at a brokerage firm in New York. I felt frustrated trying to get ahead and sometimes wondered if a man would have had the same experience. I was looking for ways to improve myself and prove myself and as a result I decided to a) take the CFA designation and b) try hard to find a better opportunity for myself within the investment industry. Along the way I also became a blogger and this opened up a wonderful network. “I have had some amazing career opportunities and one of the things I’m most proud of is when 40 Under 40 Investment News included me on their second inaugural national list in 2015. The other people on that list are so distinguished. . . it was a real honor just to be part of that group. When I walked into the ‘40 Under 40’ event, Josh Brown (the CEO of the firm I’m with today) was holding court and he stopped his talk and introduced me to the audience. This certainly helped to further raise my profile and fast forward to today . . . I’m happy to be working with him at Ritholtz.” 3. Pay attention to social media. Aline Reichenberg Gustafsson, CFA, editor in chief, NordSIP.com, Stockholm. “Every day I focus on creating ‘business karma.’ Often, I meet someone interesting and highly competent, but we don’t see any immediate and concrete opportunity to collaborate. These ‘unusable’ contacts still make it onto my mental matchmaking list, because I don’t want our interaction to go to waste. Why do I care about this? First, I (selfishly) enjoy being the source of successful introductions. Second, I am paying forward those past introductions that have benefited me throughout my career. Last, but not least, I know that the more I help people, the stronger our relationship will be. They will remember me, talk about me, and generate a positive buzz around me and my business. “A great way to accelerate karmic situations? Pay attention to the power of social media. Over the years I had often heard how important it is to take care of your social media profile and following. I can’t say that I went straight into posting updates and growing my contact list. I knew I was supposed to do it, but I didn’t understand how crucial it was until I discovered the power of social media, much later. As I ventured into the world of media, I started reaching out to people on social media more and more frequently, and posting updates and articles I wrote to generate traffic. Nowadays, I find that my reputation precedes me when I introduce myself to someone I just met: ‘I know about your business, I’ve been following your posts!’ they may say. Potential clients even reach out to me, whereas it would have taken me ages to get through to them otherwise. The results are worth multiples of what I spend taking care of my feed! ‘Why didn’t anyone tell me before?’ I asked myself. Well, of course they did, but not at the right time.”
Directors of Hannon Armstrong Sustainable Infrastructure Capital Inc. congregated in the boardroom in late 2018. On the agenda: the ideal résumé of their next finance chief. They wanted to fill the impending vacancy with someone who had expertise in raising debt and equity—a priority for the Annapolis, Md.-based investment firm. The board also decided they could do without one particular qualification. Having appointed a chief accounting officer in 2017, they didn’t care if the new chief financial officer had an accounting background. “It was almost counterintuitive, almost backwards,” said Steve Osgood, a board director at Hannon Armstrong and chairman of its audit committee. “But that freed us up to get a capital-markets-focused CFO.” CFOs have traditionally emerged from the accounting ranks, with reputations as masters of cost management, corporate finance strategy, accounting standards and reporting requirements. But the role has morphed to the point that accounting expertise is often no longer required. At the 1,000 largest U.S. public companies, the portion of CFOs who are certified public accountants fell to about 36% last year, according to data from organizational consulting firm Korn Ferry. That is the lowest figure in the six years Korn Ferry has been collecting the data, down from 46% in 2014. Finance chiefs today often oversee more than just the books. They are increasingly in charge of human resources, information technology and elements of enterprise risk management. As a result, companies increasingly want skilled general managers who possess strategic savvy and a firm grasp of operations in the CFO seat. “Technical accounting is becoming a smaller percentage of the job,” said Andrej Suskavcevic, chief executive of professional organization Financial Executives International. Executives and recruiters trace this evolution to the aftermath of the global financial crisis, when companies increasingly wanted strategy-focused CFOs who would promote transparency and operational changes to spur growth and guard against threats. That was a change from the years after the 2002 Sarbanes-Oxley Act, when companies—under pressure to improve their financial reporting—often picked chief accounting officers as their finance chiefs. The shift has had a ripple effect on the career trajectories of junior finance executives and others who were traditionally groomed for the CFO role. Changing Role, Evolving Expectations As the role of the CFO has broadened, some traditional areas of finance—tax, treasury and investor relations, for example—have grown increasingly complex, demanding more focused expertise. “There’s no way a CFO can truly be a technician in all areas,” said Chris Stansbury, CFO of Centennial, Colo.-based electronics distributor Arrow Electronics. The nuts and bolts of accounting are therefore increasingly being handled by chief accounting officers and controllers, executives say. That played a role in Hannon Armstrong’s choice of Jeff Lipson, who has a background in issuing debt and equity securities but isn’t an accountant, as CFO early last year. Mr. Osgood, the audit committee chairman—and a CPA himself—said the board reasoned that chief accounting officer Charles Melko could take care of the books and research the accounting implications of new types of transactions. Mr. Lipson, who was previously the chief executive of Congressional Bank and held treasurer roles at CapitalSource and Bank of America Corp., said having a strong accounting chief factored into his decision to take the job. “We maintain a very close and constructive working relationship,” Mr. Lipson said. The relationship has enabled him to embrace a capital-markets focus. He helped the company obtain a corporate debt rating from S&P Global Inc. and Fitch Ratings Inc., and he led the issuance of $500 million in green bonds, which fund environmental projects—both firsts for the firm, which invests in energy efficiency and renewable energy companies. The progression of the CFO role could also reflect changing expectations from Wall Street.
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Senior executive hiring has returned at an increased pace over pre-pandemic levels in recent months. Pent-up demand, stimulus-induced growth, and less-than-predicted economic damage have many organizations aggressively seeking to bring in new leadership talent. This year is already among the top five years of recruitment activity I have observed in a 20-year executive search career. It may well go higher, barring no major unpredicted adverse health, macroeconomic, or geopolitical events. The implications for finance leaders, their teams, and organizations as a whole are multifaceted. Consider for a moment the reality that a large majority of finance team members are being approached every day about new opportunities. Given the volume of recruiting activity, much of it becomes white noise. Also, recruiters, for the most part, are still not great at personalizing their outreach in a way that engages the highest performers (but they’re getting better).
Read the full article at: www.cfo.com
It’s no secret that the pace of digitalisation in the mortgage sector has been slow compared to other financial services sectors like banking or insurance. By and large, our sector has been reliant on pen and paper for far too long. However, Covid-19 lockdowns have forced the hands for many in the mortgage industry to integrate technology into their businesses. What was an evolution now shifted into a full technology revolution and transformation out of necessity. At the beginning of the March lockdown, the industry adapted well to remote working. In just a few short weeks, the mortgage market quickly moved to equip their workforces to operate from home.
Read the full article at: www.mortgagefinancegazette.com
The list of possible careers is an incredibly large one. To those trying to decide on a path for the rest of their life, it may seem to be an endless list. So many possibilities and a variety of specialties within each career path. There are many decisions to make when it comes to choosing a career for yourself. However, if you have already chosen a path to take, you are now in the position of needing information on how to achieve your goals. One excellent career choice is that of a CPA. If you are interested in becoming a CPA or have already decided that this is the career for you, it is time to begin the process to achieve this. If you are not entirely certain, you still need to take steps to determine whether or not this is the best path for you and your life. This is exactly the type of information that you will find here. Details about what steps need to be taken to become a CPA, tips on deciding if this is what you want to do, and what all being a CPA entails. Before making a decision, you must first have all the information about what exactly a CPA is and what they do. This particular acronym stands for Certified Public Accountant. The goal is to assist clients in planning and reaching their financial goals. an accountant of this status has the option of working with individuals, small businesses, large corporations, organizations or any size, or all of the above. The most common areas of work are corporations, non-profits, organizations, government offices, and other similar companies. The first step is determining if you truly want to be a CPA. While no one can make this decision for you, there are a few tips that can help you make your decision. The first tip is incredibly simple, research. Rest assured that research is your new best friend. First on the list of things to research is information about average salary, demand in your area (or the area in which you intend to work), and the exact requirements for your state. We will be talking about general requirements that must be completed regardless of what region you are in, but there are some that vary by state. During this stage of your research, you will be learning vital information about exactly what you will be getting yourself into if you choose this particular path. The more you research about what it is really like to be a CPA, the more you will understand, not only about the job but about yourself as well. This is a crucial point in the process of making a decision. The second step is to study then take and pass the uniform CPA exam. This is a long, in-depth examination that is necessary to be certified as a public accountant. The exam takes sixteen hours to complete and it is entirely computer-based testing scenario. There are four distinct parts to the exam The first is Auditing and Attestation (AUD). The second is Business Environment and Concept (BEC). The third is Financial Accounting and Concepts (FAR), Financial Accounting and Reporting (FAR). The final section is Regulation (REG). This exam is designed to assess the entry-level skills of the potential public accountant. This exam must be successfully completed to become a public accountant; however, there is no such thing as a national CPA license. This means that if you get a license in one state and later move to another state, you will have to get recertified under the regulations of that state. There are a few other requirements. Some states require an ethics exam to be taken before you can become licensed. Other requirements including experience and other testing is determined based off of the state you are planning to practice within. So many requirements differ from one state to the next. This is where more research is a necessity. Search engines are a fantastic lifeline when it comes to determining what the requirements are for your region. It is generally best to stick to general search terms such as “CPA licensing requirements in *insert state here*”. Before you can challenge the uniform CPA exam, you must have the opportunity to learn the information that you will need to pass the exam. Many states require licensing applicants to have at least one hundred and fifty (150) credit hours from an accredited college. You do not have to have a masters degree, but you do need to have a good education base. This can be in a myriad of educations courses. It is recommended to have at least some education in the realm of business as well as that of accounting. Many people wonder if there is a difference between an accountant and a certified public accountant. This is a somewhat difficult question to address because the answer can be thought of as both yes and no. Consider that all CPAs are accountants, but not all accountants are CPAs. The main differences are time invested and education. Because of this, it is best to decide if this is what you want early on so as to get a jump on the courses and credit hours that you will need.
With today’s CFO often described as a ‘financially literate CEO’, the challenge for aspiring CFOs is to develop their leadership skills and business acumen as well as their financial intelligence. With guidance on how to achieve this and why, Amy Parkinson, Principal Consultant and financial leadership specialist at executive search firm Berwick Partners, offers insight into the changing dynamic of the CFO role. The role of the Finance Director has evolved from an organisation’s financial record keeper, to a CFO who is a ‘Deputy CEO’, a business leader with exceptional financial intelligence, and who has proven skills across commercial, strategic, operational and leadership competencies. For some finance professionals, their first CFO position is secured just fifteen years after qualification.The pressure is on for the next generation of CFOs to swiftly and strategically develop their skills. Today’s CFO The evolution of the CFO has been at a steady pace. Years ago, we identified that the CFO role was becoming increasingly commercial, but the extent to which today’s CFO has become the CEO’s trusted advisor is even greater than expected. In particular, the role has expanded to involve real influence on an organisation’s commercial and strategic decisions. This is especially true within an SME, where the CFO can be responsible for operations, IT, HR and legal, as the roles of CFO and Chief Operating Officer are often combined. These changes are a consequence of increasing pressures on leadership. The CEO role is increasingly complex, with a myriad of stakeholders to manage, disruptive technologies, economic instability and a heightened level of external scrutiny. So, the CEO needs a right-hand person to help negotiate a complex landscape, and a CFO is ideally positioned to fulfil this, because of their broader skills and insight and the trust the CEO and Board have in them. The CFO has unique insights across the entire business. Financial systems that integrate all areas of the business deliver clear visibility, from purchasing decisions to pricing commercial contracts. Data analytics and business intelligence usually sit within finance, and the CFOs analytical skills ideally place them to interpret masses of data when discussing strategy with the CEO. The CFO is there to support and challenge the business and to question financial forecasts. The CFO is also trusted by external stakeholders, and accountable and reliable in the eyes of the bank, the board and regulators. The CFO of the future Over the coming years, leadership challenges are going to increase, with the place of the CFO as a trusted, strategic advisor continuing to grow. This impacts the team below the CFO and focusing on building a finance function that develops talent and that people want to join can really help. We are seeing a rise in the number of Deputy CFO positions, which is an evolution of the Group Financial Controller (GFC) role. These additional roles represent real opportunity for the right individuals. Using process automation and artificial intelligence more broadly will also free up the CFO to be more strategic, whilst also improving the efficiency of the finance function. Steps for aspiring CFOs Aspiring CFO’s must develop a broad base of financial as well as commercial and ‘soft’ skills to offer credible advice that will be well received. The foundation is, of course, a good finance qualification. From there, aspiring CFO’s need to build commercial and operational finance skills to improve their understanding of practical business issues. The role of GFC is critical, and one often overlooked by aspiring CFO’s focused on the more strategic elements, but gives credibility with stakeholders. Within a listed company, it is unlikely a CFO won’t have undertaken a GFC role at some point in their career. The Route to CFO A recent study confirms today’s CFOs agree. We sought the opinions of sixty established CFOs from a range of industries and backgrounds, and their advice for aspiring CFOs is universal: - Build a broad base of experience
Efficient career planning makes a difference; a robust career plan is vital, and taking time to invest in a career path is invaluable.There are two roles employers’ value on a potential CFO’s CV – Divisional Finance Director and Group Financial Controller. These give the opportunity to develop relationships with key career influencers, and build strategic expertise with a panoramic view of internal and external issues. - Seek international experience
As business continues to operate on the global stage, international experience is advantageous. Working internationally is an effective way to build commercial, strategic, operational, legal and technical expertise, and hone leadership skills in intense situations. - Create opportunities
Actively seeking opportunities to positively impact a business is vital. One effective way is to take on problem tasks, especially high risk projects. Aspiring CFOs become known as the ‘fix it’ person and will be trusted at a senior level. - Learn to lead
The last piece is to develop leadership skills. The days of a traditional ‘ivory towered’ FD are well and truly behind us. An effective leader has to be the trusted advisor who leads the executive and their own teams.
The COVID-19 pandemic has left no individuals, families or businesses unaffected. For businesses, the overall economic uncertainty, as well as having to adapt to remote working due to shelter in place orders, has put business planning processes under immense pressure, with calibrations needed even faster and with more frequency. Just last year, a survey of finance leaders found only 1 in 4 were confident their planning processes equipped them to be responsive to economic and geopolitical shifts. The current COVID crisis shines an even brighter light on the important role finance teams play in business strategy, ensuring decisions are based on solid data and accurate forecasts. Finance has always been a natural crucible for business strategy—a central nerve centre through which key business inputs were sanctioned and all eventual outputs measured and recorded. This is true whether it is business-as-usual operational activities, investments in new skills or capabilities, research and development (R&D) for new innovations, or simply making payroll and keeping the lights on. Finance touches every part of the organisation, and, in the best of worlds, it can act as a rich source of cross-functional insight that can feed into the overall business strategy. Now more than ever, this proves invaluable, and allows finance to take a closer look at the role they can—and should—be playing in their organisations. A single source is key The way in which businesses are run has changed radically over the past decades, with globalisation, fast and ubiquitous connectivity, digital transformation, and an explosion of data calling for more short-term adjustments to planning and execution. This new way of running an organisation requires IT infrastructure that can process and analyse data in a way that is nimble and easily actionable without depriving it of context or accuracy. Businesses that do not have a highly integrated and automated planning process in place are in jeopardy of becoming laggards and placing the organisation two steps behind competitors. With quick access to data becoming key to modern business success, finance organisations are increasingly turning to the cloud to access both financial and operational data. The shift away from on-premises planning systems, with siloed data and struggles around version control, to a system based on a single source of real-time data has helped companies become more agile. Web-based systems that provide mobile access has proven to be invaluable and is what has allowed so many businesses to quickly shift to remote work in recent months as people self-isolate due to COVID-19. New technology, new skills In addition to infrastructure technology changes, finance is also benefiting from the automation of many mundane finance tasks, such as manual data collection and consolidation of financial and operational data. Streamlining these tasks frees up finance to assume a greater strategic role for the business. This, in part, is driving a new set of skill requirements for finance teams as well. In the same 2019 study referenced above, 50 percent of finance leaders say they plan to upskill 50 percent of their workforce in the coming five years. Topping the list of desired skills is the ability to identify and manage risk, which given today’s business environment, reflects an expanding role in supporting business strategy. Finance leaders also noted expertise with new tools and technologies was key, underscoring the impact technology is having—and will continue to have—on the finance function. Change agents for finance As this evolution continues, there is a strong case to be made for finance teams to take on the position as stewards of change by acting beyond “number keepers” to transformation leaders for planning processes and sophisticated and relevant scenario-based planning. Eventually, finance will play a major role in helping the business model and automate complex, multi-stage operational practices and governance processes from end-to-end. As businesses adopt these more agile planning methods, the stage is set for finance to act as the hub of business planning. While executives will undoubtedly continue to lead on the development of business strategy, finance professionals armed with the right tools can sense change, produce insights from stimuli, and operationalize coherent responses between different departments. In other words, finance will act as the lead integrator—the lens through which all changes are anticipated, understood, and modelled in order to develop a more agile, coherent response. With this transparency, business functions will have data-driven insights to make better, faster decisions.
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