Finance flash: the TOP-10 articles of week 36, 2018

Want to keep up to date with the latest developments in finance, but you are short of time? Don't worry. CFO South Africa weekly collects 10 of the most important articles from international media for your convenience.

1. The Critical Consequences of Culture
One of our earliest lessons is to “follow the leader”. We look to our leaders for inspiration and to show us the right path. But when leaders expect the impossible, what happens to the followers? When employees at the bottom of the corporate ladder behave in unethical ways to hit their numbers, are they the ones responsible for corporate rot? Examining these questions, I’ve recently developed case studies about three well-known, troubled corporations with senior management unable to lead their firms to success while keeping within the law: Volkswagen, Wells Fargo and Uber.

2. What to Do When You Have a Bad Boss
Despite the $15 billion companies spend annually on managerial and leadership development, bad bosses are common in the American workforce.  A study by Life Meets Work found that 56% of American workers claim their boss is mildly or highly toxic. A study by the American Psychological Association found that 75% of Americans say their “boss is the most stressful part of their workday.” And a recent study by Gallup found that one in two employees have left a job “to get away from their manager at some point in their career.”

3. The Next Step in Risk Management’s Evolution
Insurance and banking business models have continued to grow in complexity over the past 50 years – from simple and local risk exposures — to the current environment of complex and global exposures. Risk management has evolved along with the business model changes, from making individual, transaction-based decisions on a combination of judgment and underwriting criteria, to looking at aggregated portfolios of risk enabled by more robust analytical tools.

4. Why data culture matters
Organizational culture can accelerate the application of analytics, amplify its power, and steer companies away from risky outcomes. Here are seven principles that underpin a healthy data culture. Revolutions, it’s been remarked, never go backward. Nor do they advance at a constant rate. Consider the immense transformation unleashed by data analytics. By now, it’s clear the data revolution is changing businesses and industries in profound and unalterable ways.

5. Why Successful Companies Usually Fail
The annals of business history are replete with the names of once great companies that dominated an industry, only to lose pre-eminence and become shadows of their former selves or even disappear. Understanding why powerful companies fail and how to avoid such failure is one of the holy grails of business and management research, not to mention having spawned an enormous and lucrative consulting industry.

6. Notes from the frontier: Modeling the impact of AI on the world economy
The role of artificial intelligence (AI) tools and techniques in business and the global economy is a hot topic. This is not surprising given that AI might usher in radical—arguably unprecedented—changes in the way people live and work. The AI revolution is not in its infancy, but most of its economic impact is yet to come.

7. Understanding the 7 mindsets of international negotiation
When it comes to negotiating, some people just want to win at all costs. Others are more interested in working together to reach an agreement that satisfies everyone involved. To get the best possible outcome, you need to understand who you’re dealing with and what motivates them – but how? 

8. Building ethical culture falls under CFO’s remit
Growing complexity in today’s business environment can expose companies to potential conflicts and ethical challenges. CFOs are well placed to understand the issues and solutions and to lead by example in building an ethical culture. In an era of increasing transparency, investors and other stakeholders are expecting more from organisations and their leaders, finance chiefs say. For example, they want greater transparency about business performance and operations and more adherence to best practice in areas such as sustainability, fair trade, and fair pay for workers and suppliers.

9. The bottom-line benefits of clear writing
Number cruncher. Bean counter. Ledger lover. You’ve likely heard them all. The oh-so-clever names for people who have mastered the enchanting world of numbers. But these days, a good part of the number crunching and bean counting is handled at lightning speed by computerised systems and automated processes. So how do you provide exceptional value in the age of extraordinary automation? In part, by using clear writing to communicate the why, not just the what.

10. Finance’s Greatest Test: A Q&A With EY’s Myles Corson
From blockchain to intelligent automation, there is no shortage of disruptive technology aiding but also challenging finance teams today. According to Myles Corson, Americas Markets Leader, Financial Accounting Advisory Services at EY, having a clear strategy and purpose when it comes to disruptive technology, while maintaining a sharp focus on talent is the key to surviving in an rapidly changing business world.