Lance Tomlinson, Assurance Leader Africa EY: Trust the numbers
‘Post the 2008 financial crisis there has been an unprecedented demand for the CFO’s unique perspective and discipline. The core skills of a CFO in ensuring that business decisions are grounded in sound financial criteria and providing the necessary insight and analysis are now even more in demand’ says Lance Tomlinson, Assurance Leader Africa at audit and consulting firm EY, until recently known as Ernst & Young. “But interestingly enough it the demands on a CFO are also not just in the technical heartland but also becoming more strategic in nature for example developing and finding the funding of an organisation’s strategy.”
As Assurance Africa chief for EY Tomlinson can think of plenty of exciting destinations for investment capital. "There are fantastic opportunities across Africa," he says. EY works in 33 African countries and has over 24,000 employees. "Our global firm has recognised the enormous investment potential Africa offers and given us money to invest in this. To be really successful in operating across Africa, we have changed our operating structure from a franchise structure to become one firm for the whole continent. We are trying to ensure that clients everywhere get the same EY experience."
For South African CFOs the expansion into Africa of local and international firms is good news, says Tomlinson. "The world has opened up to South Africa and Africa has opened up to the world. Our CFOs have great skills and broad experience with developed and emerging market issues. In many instances the talents of our CFOs are getting exported as the world better appreciates our CFO talent pool. Most of them have a Chartered Accountant qualification or an MBA in business finance. Their building blocks are solid, which means they can hold their own in the rest of the world and are particularly in high demand for firms operating in Africa."
One of South Africa's great economic opportunities comes from its gateway status for the continent, says Tomlinson. The country has good infrastructure and a strong capital markets system. "You could see that when the huge American company Walmart bought Massmart, as a springboard to the continent." But Tomlinson fears South Africa's strategic advantage will slowly wane if that gateway status isn't promoted and invested in. "South Africa is the link between developed and developing markets. I think we need to do a lot more to cement that gateway status. We now see investments coming into the continent via the East (Kenya) and the West (Nigeria). A country like Mauritius is also a draw card for a lot of headquarters, because they have infrastructure plus talented, bilingual people."
For EY CFOs are crucial "key constituents, key buyers, key relationships and key stakeholders", says Tomlinson. He shows us an EY report titled 'CFO and beyond' that explores what it takes to become and be a CFO and looks into career paths ending in a CEO or Chairperson position. "A key framework that we use to define the breadth of a CFOs remit is a 6 segment pie chart" says Tomlinson. "We use it to guide people as to what they should be doing and to guide aspiring CFOs as they plan their career development. Our though leadership called 'Finance Forte' is specifically aimed at these aspiring CFOs. This research recognises that complex environments will require multi-faceted CFOs. As such CFOs will need to hone their skills for example by sitting on other boards; of companies but also of NGOs and trusts. It is very important to get a broad view of business, so this can be incredibly useful."
Integrated reporting is high on the agendas of CFOs and EY is spending a lot of time advising businesses on how to improve their annual reports. According to Tomlinson, it is leading to a real culture change. "We are definitely seeing integrated thinking. People are not looking at financial impact alone anymore, but also at risk management, social and environmental impacts. This is not just part of the CFO's agenda, but also of the broader board. A few years ago sustainability reporting was often just used as a PR exercise, but with integrated reporting the board becomes the custodian of the changes - which makes a real difference."
If you also would like to share your ideas with the CFO community and you want to be part of the leading CFO South Africa Community, you are most welcome to get in touch with CFO SA. Please contact Jurriën Morsch at [email protected]
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