How has the FDs’ role changed?
Carolyn Bresh, global head of finance, Reuters
The role of the FD is becoming more strategic. FDs are out there visiting
customers, talking to analysts and really doing a sales job, particularly in
organisations where you haven’t got a chief operating officer, where the FD is
the right-hand person of the CEO and expected to portray the external face of
the organisation, leaving the group financial controller to manage the finance
function and do all the day-to-day operating.
Traditional accounting skills are now very much a key factor. You need them
to rise to those sorts of roles in any organisation, but they’re taken as
granted so it’s your strategic vision, business acumen, leadership and
communication skills that come to the fore.
Certainly my FD was spending much more time with customers, analysts and the
media, so a lot of the day-to-day running of the function was left to me. That
was very much ensuring all the proper controls were in place, and driving the
Sarbanes-Oxley programmes that Reuters had in the US marketplace as well.
So, it was about being accountable for all those things, making sure there
weren’t errors in the accounts, the controls weren’t slipping, and allowing him
to step up and look outside of the organisation, but feeling confident the
department was running effectively.
What’s the biggest problem with annual reports today?
David Christopherson, chief executive, Black Sun
We’ve come to a period of enormous change. I feel many of our clients are
getting to grips with the new reporting environment and in some respects the old
precedents have been thrown out and new ones put into place.
One of the challenges we are facing is redefining what is essential best
practice in narrative reporting going forward.
You might argue that if today we were starting an annual report from scratch
and had never done one before, we might not build them in the way we do now.
There has been a lot of uncertainty, a lot of change and we need a bedding-in
process now to get comfortable with the new reporting environment.
We are in the process of reviewing the December year-end reports that have
just been published, and we have seen some very interesting step changes in
terms of how people are structuring their books and their contents. In one case,
we have a client that actually uses the director’s report to house the full
Is an SME’s main concern cashflow, rather than carbon
Ian McMillan, partner in IBM Consulting
One of the challenges is that, while the conceptual logic applies to all
businesses, the economic imperative will apply more to the larger businesses. If
you consider the carbon disclosure projects initiated by the investing community
– which are about understanding businesses’ carbon footprints and how that plays
out in market valuation – it’s going to become increasingly apparent as a
component of share valuation. That gives a more tangible connection, and it will
probably drive more carbon-conscious decisions.
In an SME environment, those pressures may not exist to the same degree, and
that’s where the role of legislation comes in.
The other part of the economy that will be interesting to follow is the
public sector, because that’s a sector that generates and consumes a huge amount
of resources. The economic imperative doesn’t exist there either, so again
legislation comes into play.
A quick tip to the finance community is to start to understand big decisions
that need to be made in the business, and the green impact of them. Put that on
the agenda for the next planning cycle.
How important is having a recognised brand when it comes to investing
Stephen Cheilotis, chairman, Superbrands Councils
If you can establish a strong brand it gives you a competitive advantage,
which may give you the opportunity to expand internationally.
When you are doing so, you have to be very careful, and the same way that you
do due diligence on a company you also have to do brand due diligence on a
market. So, for example, Tesco in some countries uses the Tesco brand because it
understands that the British connections will work there, but in other markets –
the US, obviously – it is not using the Tesco name.
It is important to understand what the market wants and what the market will
accept, particularly if you are not just going to grow organically but acquire
brands. For example, when Vodafone went on its spending spree and bought local
mobile operators across the world, it had to do careful brand due diligence to
understand whether it should replace the local brand name with the Vodafone
It is important to get that branding right: a strong brand can help you
explore abroad, but you can’t assume you can just roll your brand out everywhere
and it will work.
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