Raef Lawson's guest appearances

Raef Lawson

Oral Arguments for the Court of Appeals for the Ninth Circuit

All Things Data Podcast

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Dan Smith

Ben Taylor

Danetha Doe

Greg Edwards

Andrew Warner

Sean Stein Smith

Louis Rosenberg

Kelly Richmond Pope

Nick Davies

Daniel Smith

Booz Allen Hamilton

Doug Miller

Alan Johnson

Ben Jackson

Tamara Ghandour

OwlTail

Contact Raef Lawson: https://www.linkedin.com/in/raef-lawson-2a27914/Download the Full Report, "The Impact of COVID-19 on the Finance Function": https://www.imanet.org/insights-and-trends/the-future-of-management-accounting/the-impact-of-covid19-on-the-finance-function?ssopc=1&amp;utm_source=MagnetMail&amp;utm_medium=Email&amp;utm_term=EMAIL&amp;utm_content=03%2D09%2D21%20Value%20Creation&amp;utm_campaign=How%20is%20COVID%2D19%20affecting%20the%20finance%20function%3FFULL EPISODE TRANSCRIPT:Mitch: (00:00) Welcome back to Count Me In. IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and this is episode 114 of our series. In this episode, IMA's Vice President of Research and Policy, Raef Lawson, joins our co-host Rouba Zeidan to talk about IMA’s recently released report, The Impact of COVID-19 on the Finance Function. Raef led the research and discusses his findings in regards to how this pandemic has disrupted the profession and what the perception is towards upscaling and rescaling. So, to hear more about the survey conducted and the key points from this report, we will listen in to their conversation now.   Rouba: (00:44) So good morning Raef, and thank you so much for joining me.   Raef: (00:55) Well, it's a pleasure to be here to talk about our study we recently completed.  Rouba: (01:00) Absolutely and it's quite insightful so I'm happy to be sharing this with our listeners. So let's start from the beginning, IMA published a recent report. You were the lead researcher on this body of work, which evaluated the impact of COVID-19 on the finance function. So can you tell us a little bit about the scale of this research that you conducted, basically the countries, the sample size, demographics, and then the purpose behind it?   Raef: (01:31) Sure. So it was quite a study from our perspective, it surveyed almost 1,500 people in countries from around the world and those included China, India, Saudi Arabia, the UAE and the United States, and the survey study participants were about evenly divided among those five countries by design. Slightly more than a third of the respondents were women although that percentage varied by country, ranging from say 51% in China, to 18% in Saudi Arabia. And, you know, I think though that those percentages fairly well mirror the participation of women in the workforce in those countries in the accounting and finance field. So, the purpose of the study was to really understand the impact, not just on organizations as a whole, and you know, in the news we can hear plenty about that, but you know, in keeping with IMA's mission to help advance the accounting and finance function within organizations to look a little more specifically at the finance and accounting function within organization and see what the impact of COVID-19 pandemic had been on those.   Rouba: (03:05) Amazing. And, so this is technically a global piece of research, as what are some of the most notable highlights that this report uncovered?   Raef: (03:15) Sure. Yeah and that was true, we selected the countries in the study to really get this global overview of the impact of COVID-19 on organizations, and our study yielded quite a huge thing of results. One not surprisingly was that there was, an across the board decline in revenues among organizations of all sizes. With very large companies, and by that I mean those with revenues over $10 billion, most likely to report having experienced a considerable decline in revenue, you know, of course, subsequent to that, we hear how larger organizations bounce back also more rapidly from the effects of the pandemic and how smaller companies are now, suffering. The pandemic has impacted employment as we've heard as well. And surprisingly about half of the companies have led some of their staff go.   Rouba: (04:31) That's substantial. 50%.   Raef: (04:33) It is, it is, you would think it would be much less, but that is, you know, a tremendous percentage and a lot of, obviously suffering on the employee's part. It did vary by region. So companies in the US were the least likely to have let go of staff, followed by China and India, while those in the Middle East, which again include Saudi Arabia and the UAE were most likely to have let some of their staff go. And the impact on accounting financial professionals wasn't confined to be let go or not. There was also a considerable impact on the compensation of finance and accounting professionals. And most of the respondents to our survey, reported that they had a reduction in their compensation this year, this past year, whether it was salary, bonus, or both. And again, that varied by region with companies in the US least likely to have changed the compensation of their employees, companies in China were most likely to have left salaries unchanged, but to have reduced bonuses and that reflects the larger amount of incentive compensation that Chinese companies typically pay. And finally, companies in India and the Middle East were most likely to have actually cut salaries of their employees. And then finally, another key finding was that there was a change in the findings of the priorities of finance functions, which is understandable. There was an increase in the emphasis on risk management with nearly half the company spending more time in that area, followed by cashflow forecasting new management, you know, most when the pandemic hit, a lot of companies went into crisis mode just trying to survive and these two, competencies areas became, critical for their survival. And, you know, fortunately less time was spent on business partnering and decision-making, with about a third of the company spending less time in that area, though I will say we've completed another study recently that has found that the pandemic has changed most CFO's views of their role within the organization. And most CFO’s now are becoming a business partner with their organization. Their insights are considered being key to decision making at the senior level within their organization. And I think we'll see a much greater emphasis on the CFO as a strategic business partner going forward.   Rouba: (07:48) So it does bear some good news to the profession, despite all of these, negative results. But there's also one notable point that I looked at, which was basically the tourism industry was one of the most severely impacted industries. But what other sectors also fair in terms of that kind of impact? And what do the findings tell us about them?   Raef: (08:11) You're right. The tourism travel and hospitality industries were the hardest hit industries. There, 13% of the respondents were furloughed or let go. 58% had their pay cut and, you know, that's clearly a result of companies quarantining, locking down and so forth. But also relatively hard hit were professionals in the government, nonprofit and education areas where another 5% of those folks were furloughed and, 52% had a decrease in their salary. So that was a significant impact for those industries. On a positive note, relatively least effected were those working for companies in the accounting and finance industries. Sorry, so good times or bad, we need our accountants.   Rouba: (09:12) Absolutely, you know, I liked that there's been quite a bit of that conversation of, you know, CFO’s and finance professionals stepping up to become part of the decision-making process. And I think it's these times like a pandemic that kind of puts that in perspective because you get to see how important it is to have that kind of guidance and support and direction.   Raef: (09:33) Absolutely and as you know, as I mentioned before, managing cash flow, just being able to survive it was the number one priority of many companies, especially early in the pandemic. And the CFO team was critical in that decision-making process, but next least effected were companies in related industries like financial services, banking, and real estate and I know, especially here in the United States, the real estate sector is booming. A lot of people that are working from home are looking to change their living arrangements and perhaps either get a little more space or different type of space, so some sectors of our economy, as we know, are doing quite well.   Rouba: (10:27) What this report provides is kind of a global view of the impact of COVID and when you look at the spread of the impact, which regions would you say were hit the most and how badly has the impact been on say finance and accounting professionals and their respective revenue of you know, of their organization?   Raef: (10:49) Right. So, the Middle East and India, were the hardest hit. It's clear that in the Middle East, especially, with this, with the decline in business activity, there was less demand for oil and that results in a steep drop in oil prices, which had a tremendous impact on the economy in that region. So they had to deal with not only the generic impact of the pandemic, but also the decline in their number one industry. On the other hand, China seemed to be the least impact. I think this was clearly a result of their ability to reduce the transmission of the COVID-19 virus by being able to lock down the country, and reduce transmission and enable it to restart it’s factories and the economy in general relatively quickly.  Rouba: (11:57) IMA is considered a lifelong learning institution, which strongly believes in up-skilling and re-skilling as a means of remaining ahead of the curve. What does the research say about the impact of COVID-19 on finance and accounting professionals and their interest in up-skilling and re-skilling, has it made the process more fundamental, do you think?   Raef: (12:19) Yes, absolutely. And I'm glad you're asking this question because a key mission of IMA is to make sure that accounting and finance professionals assess the skills that they need to successfully compete in the job market and have fulfilling careers. So, the answer to your question is a resounding yes. There was, a significant concern among the survey respondents as to whether their curve professional skills would be relevant post COVID-19 and 12% thought their skills would not be relevant. The other 10% were unsure. So approximately a quarter of the respondents had concerns about their skills going forward. This belief was highest in India, lowest in the United States and I think that just mirrors the employment situation in those countries where the percentage of professionals that were let go or had their pay cut was highest in that area in India, lowest in the US, but we had asked respondents about their interest in gaining new skills and the impact of COVID-19 on that and over two thirds of the respondents said the COVID-19 pandemic had increased their interest in up-skilling. And you know, clearly professionals cannot take for granted their skills and the COVID-19 pandemic has shown the need to be a well-rounded professional. So now 75% of the respondents are currently working on improving their job skills. There's belief among all the regions that up-skilling can help advance one's career and increase one's job security. And when we asked what competencies the spots were looking to up-skilling, it was across a wide range of areas. Clearly cost management, risk management, were included, but also business partnering, performance measurement, cash forecasting, basically a whole range of competencies contained in the CMA body of knowledge.   Rouba: (14:50) That's brilliant, what a confirmation. I mean, it just makes the content even more relevant. We're big on research at IMA and if anyone is involved in every single piece of research, it's you Raef, so we have to cross through, and it's amazing work that you do, honestly as someone who enjoys research as well from my end and the most recent global economic conditions survey, GECs, which we do in collaboration with ACCA, it showed, I mean, I know you said that the Middle East region was one of those that were impacted the most, but we did see in Q4 of 2020, a big jump in confidence in the region. I mean, surely there's the easing of geopolitical tensions, the continued recovery in oil prices and demand amongst other factors, but with the vaccines becoming more widely available, are there any hints of, you know, potential economic bounce back in the near future?   Raef: (15:45) Oh, absolutely. Absolutely. It's you know, even without the vaccine companies are learning how to cope, how to provide a safe work environment for their employees. In many industries while there was an initial steep decline in sales, there was also a rapid pickup in activity and we're seeing in many industries that the companies can't keep up, I mean even with existing demand. And the rollout of the vaccine will only accelerate the positive trend in economic activity. So specifically in relevance to the Middle East, this increase in economic activity is going to increase the demand for energy, specifically oil. I think oil is up over $60 a barrel, currently, which is, you know, great news for that region that will, again, have very positive impact on the companies in that region. And then finally get a lot of organizations, you know, it's been a tough time, but it's also forced them to rethink their strategy, rethink their business model, so it’ll be coming out of the pandemic operating in a more effective and efficient manner. And now we’ll again, have a very positive impact for companies around the world. So, you know, specifically for the Middle East, but also globally I think we'll see, a very significant increase in economic activity this year.   Rouba: (17:39) Excellent. I mean, it'd be great to see the world come out leaner and stronger, and we've been resilient, all throughout. So thank you for that little spring of hope at the end of the tunnel.  Raef: (17:52) It's there, it's there, it's coming, it's coming.   Rouba: (17:56) So I look forward to that and thank you so much for sharing the details of this report and the amazing work that you do. And yeah, we'll be doing more of these talks more frequently Raef.   Raef: (18:10) My pleasure, and thank you for inviting me.   Closing: (18:13) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at www.imanet.org.

Contact Raef Lawson: <a href="https://www.linkedin.com/in/raef-lawson-2a27914/" rel="nofollow" target="_blank">https://www.linkedin.com/in/raef-lawson-2a27914/</a>Download the Full Report, "The Impact of COVID-19 on the Finance Function": <a href="https://www.imanet.org/insights-and-trends/the-future-of-management-accounting/the-impact-of-covid19-on-the-finance-function?ssopc=1&amp;utm_source=MagnetMail&amp;utm_medium=Email&amp;utm_term=EMAIL&amp;utm_content=03%2D09%2D21%20Value%20Creation&amp;utm_campaign=How%20is%20COVID%2D19%20affecting%20the%20finance%20function%3F" rel="nofollow" target="_blank">https://www.imanet.org/insights-and-trends/the-future-of-management-accounting/the-impact-of-covid19-on-the-finance-function?ssopc=1&amp;utm_source=MagnetMail&amp;utm_medium=Email&amp;utm_term=EMAIL&amp;utm_content=03%2D09%2D21%20Value%20Creation&amp;utm_campaign=How%20is%20COVID%2D19%20affecting%20the%20finance%20function%3F</a>FULL EPISODE TRANSCRIPT: Mitch: (00:00)  Welcome back to Count Me In. IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and this is episode 114 of our series. In this episode, IMA's Vice President of Research and Policy, Raef Lawson, joins our co-host Rouba Zeidan to talk about IMA’s recently released report, The Impact of COVID-19 on the Finance Function. Raef led the research and discusses his findings in regards to how this pandemic has disrupted the profession and what the perception is towards upscaling and rescaling. So, to hear more about the survey conducted and the key points from this report, we will listen in to their conversation now. Rouba: (00:44) So good morning Raef, and thank you so much for joining me. Raef: (00:55) Well, it's a pleasure to be here to talk about our study we recently completed. Rouba: (01:00) Absolutely and it's quite insightful so I'm happy to be sharing this with our listeners. So let's start from the beginning, IMA published a recent report. You were the lead researcher on this body of work, which evaluated the impact of COVID-19 on the finance function. So can you tell us a little bit about the scale of this research that you conducted, basically the countries, the sample size, demographics, and then the purpose behind it? Raef: (01:31) Sure. So it was quite a study from our perspective, it surveyed almost 1,500 people in countries from around the world and those included China, India, Saudi Arabia, the UAE and the United States, and the survey study participants were about evenly divided among those five countries by design. Slightly more than a third of the respondents were women although that percentage varied by country, ranging from say 51% in China, to 18% in Saudi Arabia. And, you know, I think though that those percentages fairly well mirror the participation of women in the workforce in those countries in the accounting and finance field. So, the purpose of the study was to really understand the impact, not just on organizations as a whole, and you know, in the news we can hear plenty about that, but you know, in keeping with IMA's mission to help advance the accounting and finance function within organizations to look a little more specifically at the finance and accounting function within organization and see what the impact of COVID-19 pandemic had been on those. Rouba: (03:05) Amazing. And, so this is technically a global piece of research, as what are some of the most notable highlights that this report uncovered? Raef: (03:15) Sure. Yeah and that was true, we selected the countries in the study to really get this global overview of the impact of COVID-19 on organizations, and our study yielded quite a huge thing of results. One not surprisingly was that there was, an across the board decline in revenues among organizations of all sizes. With very large companies, and by that I mean those with revenues over $10 billion, most likely to report having experienced a considerable decline in revenue, you know, of course, subsequent to that, we hear how larger organizations bounce back also more rapidly from the effects of the pandemic and how smaller companies are now, suffering. The pandemic has impacted employment as we've heard as well. And surprisingly about half of the companies have led some of their staff go. Rouba: (04:31) That's substantial. 50%. Raef: (04:33) It is, it is, you would think it would be much less, but that is, you know, a tremendous percentage and a lot of, obviously suffering on the employee's part. It did vary by region. So companies in the US were the least likely to have let go of staff, followed by China and India, while those in the Middle East, which again include Saudi Arabia and the UAE were most likely to have let some of their staff go. And the impact on accounting financial professionals wasn't confined to be let go or not. There was also a considerable impact on the compensation of finance and accounting professionals. And most of the respondents to our survey, reported that they had a reduction in their compensation this year, this past year, whether it was salary, bonus, or both. And again, that varied by region with companies in the US least likely to have changed the compensation of their employees, companies in China were most likely to have left salaries unchanged, but to have reduced bonuses and that reflects the larger amount of incentive compensation that Chinese companies typically pay. And finally, companies in India and the Middle East were most likely to have actually cut salaries of their employees. And then finally, another key finding was that there was a change in the findings of the priorities of finance functions, which is understandable. There was an increase in the emphasis on risk management with nearly half the company spending more time in that area, followed by cashflow forecasting new management, you know, most when the pandemic hit, a lot of companies went into crisis mode just trying to survive and these two, competencies areas became, critical for their survival. And, you know, fortunately less time was spent on business partnering and decision-making, with about a third of the company spending less time in that area, though I will say we've completed another study recently that has found that the pandemic has changed most CFO's views of their role within the organization. And most CFO’s now are becoming a business partner with their organization. Their insights are considered being key to decision making at the senior level within their organization. And I think we'll see a much greater emphasis on the CFO as a strategic business partner going forward. Rouba: (07:48) So it does bear some good news to the profession, despite all of these, negative results. But there's also one notable point that I looked at, which was basically the tourism industry was one of the most severely impacted industries. But what other sectors also fair in terms of that kind of impact? And what do the findings tell us about them? Raef: (08:11) You're right. The tourism travel and hospitality industries were the hardest hit industries. There, 13% of the respondents were furloughed or let go. 58% had their pay cut and, you know, that's clearly a result of companies quarantining, locking down and so forth. But also relatively hard hit were professionals in the government, nonprofit and education areas where another 5% of those folks were furloughed and, 52% had a decrease in their salary. So that was a significant impact for those industries. On a positive note, relatively least effected were those working for companies in the accounting and finance industries. Sorry, so good times or bad, we need our accountants. Rouba: (09:12) Absolutely, you know, I liked that there's been quite a bit of that conversation of, you know, CFO’s and finance professionals stepping up to become part of the decision-making process. And I think it's these times like a pandemic that kind of puts that in perspective because you get to see how important it is to have that kind of guidance and support and direction. Raef: (09:33) Absolutely and as you know, as I mentioned before, managing cash flow, just being able to survive it was the number one priority of many companies, especially early in the pandemic. And the CFO team was critical in that decision-making process, but next least effected were companies in related industries like financial services, banking, and real estate and I know, especially here in the United States, the real estate sector is booming. A lot of people that are working from home are looking to change their living arrangements and perhaps either get a little more space or different type of space, so some sectors of our economy, as we know, are doing quite well. Rouba: (10:27) What this report provides is kind of a global view of the impact of COVID and when you look at the spread of the impact, which regions would you say were hit the most and how badly has the impact been on say finance and accounting professionals and their respective revenue of you know, of their organization? Raef: (10:49) Right. So, the Middle East and India, were the hardest hit. It's clear that in the Middle East, especially, with this, with the decline in business activity, there was less demand for oil and that results in a steep drop in oil prices, which had a tremendous impact on the economy in that region. So they had to deal with not only the generic impact of the pandemic, but also the decline in their number one industry. On the other hand, China seemed to be the least impact. I think this was clearly a result of their ability to reduce the transmission of the COVID-19 virus by being able to lock down the country, and reduce transmission and enable it to restart it’s factories and the economy in general relatively quickly. Rouba: (11:57) IMA is considered a lifelong learning institution, which strongly believes in up-skilling and re-skilling as a means of remaining ahead of the curve. What does the research say about the impact of COVID-19 on finance and accounting professionals and their interest in up-skilling and re-skilling, has it made the process more fundamental, do you think? Raef: (12:19) Yes, absolutely. And I'm glad you're asking this question because a key mission of IMA is to make sure that accounting and finance professionals assess the skills that they need to successfully compete in the job market and have fulfilling careers. So, the answer to your question is a resounding yes. There was, a significant concern among the survey respondents as to whether their curve professional skills would be relevant post COVID-19 and 12% thought their skills would not be relevant. The other 10% were unsure. So approximately a quarter of the respondents had concerns about their skills going forward. This belief was highest in India, lowest in the United States and I think that just mirrors the employment situation in those countries where the percentage of professionals that were let go or had their pay cut was highest in that area in India, lowest in the US, but we had asked respondents about their interest in gaining new skills and the impact of COVID-19 on that and over two thirds of the respondents said the COVID-19 pandemic had increased their interest in up-skilling. And you know, clearly professionals cannot take for granted their skills and the COVID-19 pandemic has shown the need to be a well-rounded professional. So now 75% of the respondents are currently working on improving their job skills. There's belief among all the regions that up-skilling can help advance one's career and increase one's job security. And when we asked what competencies the spots were looking to up-skilling, it was across a wide range of areas. Clearly cost management, risk management, were included, but also business partnering, performance measurement, cash forecasting, basically a whole range of competencies contained in the CMA body of knowledge. Rouba: (14:50) That's brilliant, what a confirmation. I mean, it just makes the content even more relevant. We're big on research at IMA and if anyone is involved in every single piece of research, it's you Raef, so we have to cross through, and it's amazing work that you do, honestly as someone who enjoys research as well from my end and the most recent global economic conditions survey, GECs, which we do in collaboration with ACCA, it showed, I mean, I know you said that the Middle East region was one of those that were impacted the most, but we did see in Q4 of 2020, a big jump in confidence in the region. I mean, surely there's the easing of geopolitical tensions, the continued recovery in oil prices and demand amongst other factors, but with the vaccines becoming more widely available, are there any hints of, you know, potential economic bounce back in the near future? Raef: (15:45) Oh, absolutely. Absolutely. It's you know, even without the vaccine companies are learning how to cope, how to provide a safe work environment for their employees. In many industries while there was an initial steep decline in sales, there was also a rapid pickup in activity and we're seeing in many industries that the companies can't keep up, I mean even with existing demand. And the rollout of the vaccine will only accelerate the positive trend in economic activity. So specifically in relevance to the Middle East, this increase in economic activity is going to increase the demand for energy, specifically oil. I think oil is up over $60 a barrel, currently, which is, you know, great news for that region that will, again, have very positive impact on the companies in that region. And then finally get a lot of organizations, you know, it's been a tough time, but it's also forced them to rethink their strategy, rethink their business model, so it’ll be coming out of the pandemic operating in a more effective and efficient manner. And now we’ll again, have a very positive impact for companies around the world. So, you know, specifically for the Middle East, but also globally I think we'll see, a very significant increase in economic activity this year. Rouba: (17:39) Excellent. I mean, it'd be great to see the world come out leaner and stronger, and we've been resilient, all throughout. So thank you for that little spring of hope at the end of the tunnel. Raef: (17:52) It's there, it's there, it's coming, it's coming. Rouba: (17:56) So I look forward to that and thank you so much for sharing the details of this report and the amazing work that you do. And yeah, we'll be doing more of these talks more frequently Raef. Raef: (18:10) My pleasure, and thank you for inviting me. Closing: (18:13) This has been Count Me In, IMA's podcast, providing you with the latest perspectives of thought leaders from the accounting and finance profession. If you like, what you heard and you'd like to be counted in for more relevant accounting and finance education, visit IMA's website at <a href="https://www.imanet.org/?ssopc=1" rel="nofollow" target="_blank">www.imanet.org</a>.

Ep. 114: Raef Lawson - The Impact of COVID-19 on the Finance Industry

Raef Lawson, Ph.D., CMA, CSCA, CPA, CFA, CAE, is professor-in-residence and vice president of research and policy at IMA.  He discusses his research on The Impact of Big Data in Finance Now and in the Future.

Raef Lawson, Ph.D., on Big Data and Finance now and in the Future.