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2020 was a year unlike any other—in more ways than one. Sure, we have seen regular activities that we expected to see: businesses operated, some restructured. Priorities shifted. Businesses were merged, acquired and sold. But we’ve also seen companies go through incredible hardships.
Now that we’ve made it to the start of a new year, things are starting to look more promising. The vaccine is being distributed—and even though “business as usual” still isn’t exactly ‘usual,’ there are clearer hopes for brighter days. We have to remember what guided us through all of these challenging quarters thus far and the guidance we provided since the onset and throughout the pandemic: it’s vital for business leaders to clearly and transparently articulate to stakeholders what their company is going to look like on a go-forward basis. Here’s several points to keep in mind during your strategic planning and year-end reporting processes to effectively communicate with your stakeholders.
Be focused on the business model and returning to growth
In prior years, past performance was able to be more easily gauged for an indicator on future performance. This year, we cannot make the same assumption. We need to think about the magnitude of the business implications, both on the whole and within segments, and in order to do that, businesses have to put the year into context. From revenue strategy to supply chain management and cost containment, it will be imperative for leaders to transparently communicate what the business will look like on a go-forward basis. This is also a time to accelerate the focus on technology and data and how it will transform the growth strategy and target operating model.
Acknowledge the shift in expectations of businesses
So much happened this year that made businesses take a hard look at their priorities and operating assumptions. We’ve seen so many companies step up in a big way. From making Net Zero commitments, to reinforcing a safety culture, to setting new diversity & inclusion goals, to extending new workforce benefits and flexible working arrangements—whether it falls under the ‘E’ the ‘S’ or the ‘G,’ environmental, social and governance (ESG) issues have really come into focus. As a next step, companies should think about how best to make commitments, measure these impactful non-financial changes, and where and how to effectively communicate what they’ve done on a go-forward basis.
Be realistic
There’s nothing worse (perhaps) than building up high expectations and then underperforming. Keep your perspective on the future grounded in reality. Access, reassess, adjust, and reassess some more. Realistic goals will allow you to keep your priorities as well as quality in focus.
Most importantly, whether you’re a CFO, on the audit committee—or anyone in the workforce, for that matter, remember that there is no shortcut to quality, or quality of reporting. To amplify that, going forward, the marketplace and the regulatory community will not accept the pandemic as an excuse for low quality reporting and being less than transparent about the circumstances. If anything, we should be more confident in our reporting now; we’ve come through three quarterly reports during this time of uncertainty. We can do this, and smart business leaders will be using their platform and this moment in time to help propel business and society forward through trust, transparency and quality reporting.
Wes Bricker is the US Vice Chair and Assurance Leader at PwC.