The Employment Investment Incentive Scheme looks set to become a vital source of much-needed funding for businesses in Ireland. Paddy Morrissey explains why The Employment Investment Incentive Scheme (EIIS) has been a crucial source of funding for Irish SMEs since its introduction in 2011 when it replaced the Business Expansion Scheme (BES). Now, EIIS, which allows Irish taxpayers to claim relief of up to 40 percent on qualifying investments, looks set to become an important source of investment for SMEs operating in a volatile economic environment in which risk appetite is on the wane. Despite several pre-budget submissions from various bodies, Budget 2023 became the first Budget in recent years to propose no amendments to the scheme after a period in which significant changes were made. The most significant came in the Finance Act 2019, which introduced a new self-certification-based system to replace the existing Revenue approval system. This allowed investors and investee companies to take responsibility for fulfilling the scheme's conditions. Once the investment takes place, the company may issue a "Statement of Qualification", allowing investors to claim their tax relief. The move to self-certification was widely welcomed, as it significantly shortened the period between an investor making an investment in a company and being able to claim tax relief. Some concerns have been raised about the uncertainty self-certification creates for a company receiving investment, however. The main concern here is that where a company is judged to be non-compliant with the provisions of EIIS, the withdrawal of the tax relief is against the company. In a scheme known for its complexities, companies are now limited to querying particular areas of the EIIS legislation solely with Revenue. It is not possible to seek an overall opinion from Revenue on whether or not an investment will qualify – a point noted in some pre-budget submissions. With that said, Revenue's guidance notes (Part 16-00-02), coupled with appropriate tax advice, are critical resources available to stakeholders to minimise risks. The most recent changes to EIIS came in Finance Act 2021. This extended the scheme to 2024 and removed the requirement for the benefitting company to spend 30 percent of the investment before issuing a "Statement of Qualification", accelerating the time between investment and the investor's ability to claim tax relief. The 2021 Act also significantly broadened the scope of fund structures that can complete EIIS investments, allowing Investment Limited Partnerships or Limited Partnerships managed by Alternative Investment Fund Managers to participate in the scheme. The 2021 Act also relaxed the 'capital redemption window' rules. Previously, exiting the initial investment before the second tranche investment had completed its minimum four-year holding period would result in a clawback of the investor's tax relief claimed on the investment. Now, investors may complete follow-on investments in a company without it impacting their ability to redeem or exit the initial investment. Recent findings suggest a contraction in investment activity in Ireland, driven by a volatile global economic backdrop. According to the Irish Venture Capital Association, overseas funding in Irish technology companies fell by 50 percent between the first and second quarters of 2022—from €303 million to €152 million. Equally, rising interest rates are driving a higher cost of debt funding. In this context, EIIS funding, boosted by legislative changes to the scheme in recent years, looks set to become an increasingly important source of equity funding for Irish SMEs in the coming years. Paddy Morrissey is an Investment Associate with BES Management DAC, the fund manager of The Davy EIIS Funds

As financial services firms prepare to comply with Central Bank guidance on operational resilience by December 2023, there will be challenges ahead, writes Linda Gibson The Cross Industry Guidance on Operational Resilience issued recently by the Central Bank of Ireland (CBI) highlighted just how important operational resilience has become to the financial services regulator—increasingly comparable to financial resilience, both in terms of regulatory resources and the supervisory scrutiny firms can expect to face. While the past two years have been challenging for businesses in Ireland, their resilience journey is only just getting started. The objective of the Central Bank’s guidance is to communicate to the industry how to prepare for, respond to, recover, and learn from an operational disruption that affects the delivery of critical or important business services. The guidance aims to enhance operational resilience and recognise the interconnections and interdependencies within the financial system that result from the complex environment in which firms operate. Responsibility is now being placed on the board and senior management to approve: the operational resilience framework; the critical or important business services; impact tolerances, business service maps, scenario testing to ascertain the firm’s ability to remain within impact tolerances; and communications plans. The CBI’s approach is that every firm, regardless of size or activity, will need to meet its expectations. While proportionality is a key factor, every firm will likely have at least one critical or important business service. Firms will now be working towards compliance with the CBI’s guidance on operational resilience by the December 2023 deadline. If firms needed a reminder of the importance of operational resilience, they need look no further than the recent disciplinary measures taken by the CBI against firms that failed to ensure continuity of service in the event of a significant IT disruption and for outsourcing-related control failings.  Embedding hybrid working into resilience models COVID-19 has brought operational resilience to the forefront of the boardroom agenda after firms around the world grappled with significant day-to-day disruption and a shift in the status quo. Where previously it was seen as more of a planning exercise, this rapid change helped focus many leadership teams on the need to meet the regulator’s expectations. Across our organisation, we revisited many of our controls during the pandemic to ensure that potential risks arising from remote working were considered (print capabilities were disabled centrally, for example). Maintaining most of these controls enabled us to accommodate an environment where employees work flexibly, both within and outside of the office. Promoting the shift towards resilience While a paradigm shift in mindset and culture may be unnecessary, there is value in consistently conveying that resilience is about understanding what is most important and planning to get that done, even in dire circumstances. It is important to engrain an enterprise-wide culture and mindset. If you have a consciously engaged and resilient workforce, resilience planning and decision-making will be more effective. In addition to building resiliency by design, to prevent and minimise most disruptions, firms should strive to maintain strong contingency plans for “all hazards” such that, when disruption is unavoidable, they are able to recover and resume the delivery of services as quickly as possible.   Future fix The events of the past two years have brought to light the reality of supply chain risk and business continuity challenges associated with third-party vendors. This significant and persistent threat forced businesses to undertake consequence assessments of supplier disruptions on operational, strategic and financial functions. These are all key elements of operational resilience. Firms now have an opportunity to "future fix"; to create more resilient operating models and build for competitive advantage. They must recognise that the purpose of the new regime is not to demonstrate how resilient they are, but for them to proactively assess where they may have resilience gaps and look to address these gaps as soon as is ‘reasonably practical’, and no later than December 2023. The challenge across the industry is to relay to employees. The next year will be a busy time, and firms need to act early to address vulnerabilities where they exist, instil the operational resilience mindset throughout the organisation, and adjust their operating models to support resilience where it is necessary. Linda Gibson is the Head of Regulatory Change at Pershing EMEA

Dawn Leane examines the main barriers to success experienced by women and what organisations can do to break the career inhibitors down In workshops organised after the publication of the research study carried out by Fiona Dent and Viki Holton for their book Women in Business: Navigating Career Success, women were asked to identify factors they believed had hindered their progress. Their responses are broadly categorised as follows: Limiting beliefs; Family issues; Work colleagues; Personal style and skills; Lack of organisational support; Gender issues; Taking the wrong career path; and Politics and bureaucracy. The most frequently mentioned issues focus on self-doubt and limiting beliefs. As this is a nuanced subject, it is important to distinguish between limiting beliefs and confidence.  Limiting beliefs vs confidence Beliefs are assumed truths developed over time from our direct experiences and observations. They usually don’t exist as explicit propositions. We may barely be aware of them, but they influence what we think, say, and do.  When they manifest self-doubt, they become limiting beliefs. An example of a limiting belief may be ‘I can’t handle conflict’, which could lead to a lack of assertiveness or the tendency to give in to others. Limiting beliefs can have a significantly negative impact on our ability to achieve our full potential. Confidence, however, can be significantly influenced by workplace culture. Women are regularly told that they should be more confident, which is particularly unhelpful as it puts the responsibility firmly back on women, as opposed to examining the environment as a contributing factor. One way in which the office environment can impact confidence is ‘backlash avoidance mechanism’, whereby women feel uncomfortable self-promoting due to perceived social consequences. Feedback and career development In the workshop, 59 percent of participants believed that men and women are judged unequally, particularly when it comes to feedback and development in the workplace. This is supported by the Women in the Workplace study—a study of US women in the workplace conducted by LeanIn.Org and McKinsey & Company—which found that women report receiving feedback much less frequently than their male co-workers. In fact, women are more than 20 percent less likely than men to receive difficult feedback, which is essential to improving performance. One reason cited by managers is their fear of an emotional response, which is less of a concern when giving feedback to male employees. Further, the feedback that women receive is often vague and non-specific. In their Harvard Business Review article, ‘Research: Vague Feedback is Holding Women Back’, Shelly J. Correll and Caroline Simard advised that “women are systematically less likely to receive specific feedback tied to outcomes, both when they receive praise and when the feedback is developmental.” They also found that when women did receive feedback, it was largely focused on their style of communication. Family issues While it is widely accepted that family issues can be a barrier to success, most participants in Dent and Holton’s research recognised that decisions made in relation to family life require compromise—and that it was typically the woman in the relationship who compromised out of personal choice. Many women accepted this as an inevitable consequence of motherhood and feel obliged to take responsibility and be available for their children. Managing employee long-term success The overarching message from these pieces of research is that what happens early in a woman's career significantly impacts her long-term success. It is important that both the career accelerators and inhibitors discussed in this series are considered by organisations when developing talent management and career development programmes. You can read the first two articles in this series: Empowering women for better balance in the workplace Four success factors for women in the workplace Dawn Leane is Founder of Leane Leaders and Leane Empower. 

Good coaches motivate, support and inspire us. So, what can leaders do to become the inspirational coach their team needs? Patrick Gallen shares his insights When we think about a coach, our first thought may be of sports coaches, and images of wild gesticulating on the side-lines to rallying pep talks. People don’t always associate the idea of coaching with the workplace. However, for the past 30 years, many leaders have embraced coaching as a way of developing employees and driving organisational performance. The skill sets are transferrable, and there is no arguing with the evidence – good coaches produce better results. Increased need for workplace coaching There has never been a more important time or a greater need for incorporating a coaching approach into leadership styles. With the increasingly demanding changes brought about by the legacy of the pandemic, blended working environments, amendments to legislation, advancements in technology and human interconnectivity are all contributing to increased pressures experienced by staff on a daily basis. There is a need for leaders to put their coaching hat on and listen, ask questions, challenge thinking, and provide support to their team. If employees are not supported through periods of change, there can be a detrimental impact on engagement and, ultimately, performance. In a recent survey done by Forbes Magazine, only 33 percent of employees report feeling engaged, and companies with greater levels of employee engagement are, on average, 22 percent more profitable. Research proves that coaching improves employee morale, boosts engagement, enhances employee retention, and drives productivity. Even tech companies such as Meta, Google and Apple increasingly seek workers with ‘soft skills’, like coaching. What makes a good coach? Humility, openness and authenticity: The old model of ‘leader as hero’ can be replaced with a model that is humble and open. Be open to questions, and if there is something you can’t confidently answer, don’t be afraid to say so. This can foster an authentic sense of relationship transparency, which is integral to trust. Shared purpose and values: Sometimes, we can’t see the wood for the trees. Effective coaches can encourage organisational focus, team cohesion, and group resilience by stepping back from the noise and redirecting attention to the shared purpose and values of the team. Trust and communication: It may seem obvious, but effective coaching centres around communication. By keeping teams informed and encouraging frequent communication, employees can feel more in control and involved. Enabling vertical as well as horizontal communication – and employing a healthy sense of humour – can go a long way. Team support: Psychological safety is vital for teams during times of change. Would your team benefit from a safe space and having their voices heard in decisions that affect them? Do your people feel free to speak up, disagree, or challenge? Coaches help create that environment. Celebrate success: It’s human nature to dwell on things that go wrong as opposed to right. However, effective coaches give credit where credit is due. As the old adage goes, ‘people don’t quit jobs, they quit managers’. What can you do to be the coach that your team needs? Patrick Gallen is People and Change Partner at Grant Thornton

Despite the tough current climate, Budget 2023 made clear that action against climate change remains a priority for the government. Deirdre Hogan explains The Minister for Finance, Paschal Donohoe TD, delivered his Budget 2023 speech against a contrasting backdrop: the trilemma facing Irish businesses and individuals of energy, inflation and supply chains versus the recent positive reports on the exchequer finances. While the Budget’s focus was on solving the short-term cost of living crisis, the Minister noted that “climate change is one of the key challenges of our time”, indicating that the climate crisis remains a priority for the Government. Carbon tax As expected, carbon tax was increased by €7.50 from €41 to €48.50 per tonne of CO2. The carbon tax increase applies from 12 October 2022 for auto fuels but will be offset by a levy reduction, so we will not see a price increase. For all other fuels, carbon tax will increase from 1 May 2023.   Due to the current energy crisis, the government opted to extend the nine percent reduced rate applicable to electricity to February 2023 and maintain the excise reduction introduced last spring on marked gas oil, petrol, and diesel of five, 16 and 21 cents respectively, providing for costs in the winter months when energy usage will be at its highest.   The receipts from carbon tax are ringfenced to support wider sustainability initiatives and to support the costs of society and businesses in their transition from high carbon-emitting practices to more sustainable alternatives. Carbon tax is expected to generate €623 million in 2023, and almost 50 percent of that is earmarked to go into improving the energy efficiency of houses. Certain social welfare measures, such as Qualified Child Payment and the Fuel Allowance, will also be funded by the carbon tax. The Fuel Allowance is set to increase to €200 above the relevant State Pension Contributory, while those over 70 will see an increase in the Fuel Allowance to €500 for a single person and €1000 for a couple. Agriculture Farmers are set to receive €81 million to finance a new agri-climate rural environment scheme that will support up to 50,000 farmers who take action to improve biodiversity, climate, air, and water quality. Individuals Every household in Ireland will receive €600 in electricity credits over three €200 payments commencing pre-Christmas 2022. Businesses For businesses, a Temporary Business Energy Support Scheme is being introduced to assist businesses with their energy cost over the winter months. Other sustainability-related measures Other sustainability measures introduced include the announcement that €850 million will be spent on capital investment by the Department of the Environment, Climate and Communications in 2023 with over €337 million going towards grants for improved energy efficiency. This should fund over 37,000 home energy upgrades. In transport, the reduction of fares by 20 percent and the 50 percent reduction in the Youth Travel Card will both be extended until the end of 2023. Considering the current sustainability skills shortages in the labour market, the government provided for more than 2,000 apprenticeship places in areas around sustainable finance, green technology, and climate change. The above measures are all welcome and positive. However, there is more work to be done to help increase the pace of our climate or sustainability ambitions. Deirdre Hogan is Partner, Tax and Law from EY Ireland

Russia’s invasion of Ukraine has created an energy crisis across the European Union. Now is the time for European governments to radically restructure their energy sectors, writes Judy Dempsey As autumn kicks in, there’s hardly a household or company in Europe that has not been affected by the huge hikes in energy prices. Now that Russia has stopped supplying gas to Germany via the Nord Stream gas pipelines, governments are rushing to buy expensive gas, attempting to fill their storage facilities ahead of the winter. The last thing they want are price-hike demonstrations and to lose support for Ukraine’s determination to defeat the Russian military. There are several lessons in these price hikes and shortages that must be learned by all EU member states, and the first is the price of dependency. Successive German governments and companies believed gas contracts with Russia were reliable and stable, but how many times did experts warn that Russia could one day use energy exports as a geopolitical instrument? By cutting off energy supplies, Russian President Vladimir Putin is punishing the European opposition to Russia’s invasion of Ukraine in the form of sanctions and curtailed weapon supplies to Kyiv. Putin’s goal hasn’t changed. He wants to divide the EU and give succour to populist movements that are often pro-Russian, anti-NATO and anti-American. That is why the West must stay the course over Ukraine. A Russian victory in Ukraine is a defeat for European security and stability. The second lesson here is how the European Commission, despite its best intentions, did not liberalise energy markets enough to ensure that energy could, like the single market, flow across the EU. The third concerns the failure to link up electricity and gas grids, from north to south—and to link the Baltic states to their western neighbours just as Russian gas transmissions had for decades been designed to flow westwards to Europe via Germany. Fourth is the issue of solidarity, always a thorny issue if you recall the absence of solidarity during the 2015 refugee crisis. With regards to the energy crisis, EU member states have been trying to find their own national responses. Yet, Germany—whose household energy prices are sky-rocketing—actually sells gas to France. Why? Because France, which uses nuclear energy as one of its main energy sources, has neglected the maintenance of its plants. Meanwhile, Denmark has a surplus of energy, but the grids to export this energy are not compatible with other EU member states. The fifth lesson is that this energy crisis should be the catalyst for pushing forward renewable energy. Yet, in a bid to get through this winter, Germany’s Social Democrat-Green-Free coalition is re-opening coal faces. While the Greens support this very ‘un-Green’ development, the party is divided over whether the remaining nuclear power stations former Chancellor Angela Merkel vowed to close by this year should be kept open. In short, Europe’s backing for reducing carbon emissions will be a challenge. In June 2021, the EU adopted a European Climate Law aimed at reaching net zero greenhouse gas emissions (GHG) across the bloc by 2050, with an intermediate target of 55 percent by 2040. This commitment will be tested unless there is massive up-front investment and political commitment to forge ahead with making renewable energy the priority. If not, Europe will be unable to break out of the dependency trap, unable to cope with another energy crisis, and unable to take another big step towards integration and embracing climate by connecting the different energy sectors. Judy Dempsey is a Non-Resident Senior Fellow at Carnegie Europe and Editor-in-Chief of Strategic Europe

Coined in the seventies, the term ‘the glass ceiling’ has become a mainstay of discourse on gender equality in the boardroom, but over 40 years on, have we even come close to breaking it? Liz Riley reports It was during her speech at the 1978 Women’s Exposition in New York City that Marilyn Loden, the American feminist author, and workplace diversity advocate, coined the phrase ‘the glass ceiling’.  Forty-four years on, the term is still relevant—outliving Loden, who died in early August 2022. “I thought I would be finished with this by the end of my lifetime, but I won’t be,” Loden said in an interview with The Washington Post in March 2018.  “I’m hoping, if it outlives me, it will [become] an antiquated phrase. People will say, ‘There was a time when there was a glass ceiling’.” So, what is the glass ceiling—and how relevant is it to the workplace of today? Defining the glass ceiling The ‘glass ceiling’ is a metaphor describing the barrier preventing women from rising beyond a certain level in their profession. They have a clear view of what is beyond their reach, but they can’t break through to the other side. “There are two aspects to the glass ceiling,” explains Louise Molloy, Director of Luminosity Consulting, and an executive and team coach specialising in leadership development. “Well recognised are the limits organisations, culture, society, and behavioural norms, put on women.  “It is now also recognised that there are limits that we, as women in the workplace, might inadvertently put on ourselves. We do this through the options we advocate for, how we position ourselves, and the career decisions we make. To really break the ceiling, we need to work on both.” With gender pay gap reporting coming into effect this year, you might think that the end to the glass ceiling is surely near. According to a recent report by the European Commission, however, the number of women in Ireland holding senior management positions stood at just 28.8 percent in 2020, up from 15.3 percent five years prior. Ireland has made “excellent progress” on gender equality, the report states, but not everyone agrees. “While progress has been made in Ireland, women here are still substantially underrepresented in senior roles and decision-making spaces,” says Emma DeSouza, Women’s Leadership Coordinator with the National Women’s Council of Ireland.  “According to the latest CSO Gender Balance in Business Survey, in 2021, only 22 percent of the members of Boards of Directors in Ireland were female, one in eight CEOs in large enterprises in Ireland were women, and men accounted for 86 percent of Board Chairpersons.” While Chartered Accountants Ireland (the Institute) currently has 42.6 percent female membership overall, the 24-44 age group has an average 51 percent female membership, showing clear progress among the younger generations of Chartered Accountants.  Of the 1,686 people who have listed their job descriptions and identify as ‘senior executive’, however, just 287 of women. “I think we have made progress, but progress is not necessarily good enough”, says Sinead Donovan, Chair of Grant Thornton, and Deputy President of Chartered Accountants Ireland, “The end destination is to break through the glass ceiling. It is distressing that we are not there yet. Every year we celebrate that we are getting closer to breaking it. Sometimes, I wonder if that is a helpful narrative or not. “At the end of the day, if the intake to our profession is more than 50 percent female—and has been more than 50 percent for several years—and the population is more than 50 percent female, well, then we shouldn’t be celebrating anything until we are at that 50 percent mark.” Progress in the profession Eileen Woodworth became the first woman to be admitted to the Institute in 1925, but progress in the years that followed was slow. Professor Patricia Barker, Lecturer of Business Ethics at Dublin City University, was the 20th woman admitted to the Institute—48 years after Woodworth.  The issues preventing women from entering the profession didn’t stop at admittance. “Most people couldn’t conceive of a woman being a Chartered Accountant,” says Barker. “I was regularly addressed as a man with the name, ‘Mr Patrick McCann’. There were no women’s bathrooms for members in the Institute at Fitzwilliam Place. I had to use the librarian’s loo. Miss Jenkins was not pleased.” When she “pitched up to conduct the audit”, clients assumed she was the comptometer operator, Barker recalls. “There have only been two women presidents of Chartered Accountants Ireland since its inception, Margaret Downes in 1983 and Shauna Greely in 2017—a wide 34-year gap.”  This gap is closing, however. Sinead Donovan will take the reins as the Institute’s President in 2023. “It is an improvement, but one from a disgraceful base,” says Donovan. “It is shocking that it has taken this long.  “However, I think we are in a good place now for the future. It’s key to look at the movement [the Institute has] made on the composition of Council, which is currently sitting at a 47/53 percent split. We should maintain those numbers and aim for at least a 40/60 percent split for Council officers going forward.” Former Institute President Shauna Greely, who is currently Chair of the Institute’s Diversity and Inclusion Committee, also feels positive about the future. “Lots has been achieved in the past 50 years with gender representation in the profession,” says Greely.  “We have gone from 20 female members 50 years ago to 13,000 today. It is hugely important to have female role models, and we have many. Female graduates are encouraged to become Chartered Accountants, and female members can aspire to what others have achieved before them.” Diversity and inclusion It is now common for organisations to have initiatives and strategies specifically aimed at diversifying the employee pool. Molloy thinks this is helping women to find equity in the workplace. “Industry-level initiatives such as the 30% Club and Women in Finance and Tech are great for spotlighting the issue at a macro level,” Molloy says. At a company level, employee resource groups such as Meta’s ‘Women@’ initiative also help to create a space for women to share their experiences and build alliances, Molloy adds. “Through specialist sessions on topics such as how to communicate impactfully about your work and ambitions and how to network strategically, women learn to empower themselves,” she says.  “Many of the groups I work with have men as well, both as champions of diversity and attendees. These initiatives tend to be hugely successful as they are self-empowering and drive change from within.” Like Molloy, Donovan feels that support from both women and men is needed in any effort to help women get ahead. “We need to call it out. It cannot be down to women to ask about female representation on committees,” she says.  “It upsets and annoys me, and I know it annoys the lads when I’m the one who has to say it, when we all know it shouldn’t have to be me. The whole board should think about the diversity of the organisation.” Ultimately, Donovan believes that ‘Gen Z’ (the next generation of professionals, born between 1997 and 2012) could be the ones to pave the way for true workplace equality.  “I think they will flip a switch, but, whether it’s a switch for gender equality, I don’t know. I think equality and diversity will be a by-product of their way of working. Because of Gen Z, working will become more virtual, less about relationships and more about deliverables,” she says. “They are just not into developing relationships in the way that we were. That should mean the output will be more diverse, but I don’t think that’s the driving force. They’ll ask if it makes their work-life balance better or gives them space to do what they want to do. That will be their driving force rather than ticking diversity boxes.” Barker agrees, saying it will be interesting to see “if women retain the foothold they have achieved” as we move into new models of working, incorporating working remotely and a potential drop in employment opportunities “as inflation rises”. Breaking the glass ceiling As for actually breaking the glass ceiling, Donovan doesn’t hold out much hope. “I don’t think we will ever, as a country and a culture, waiver from the fact that women ‘need’ to stay at home to rear children or take time out from their careers to have children,” she says.  “Whilst that is there, I think it will always be a barrier to equity. I think if we get to 40/60 at the top levels of the profession, that might be where we cap out. We will never have enough momentum to enable the progression needed to achieve parity. Does a break from work impact a woman’s career? It does. It absolutely does. This will only be corrected when it becomes accepted and ‘the norm’ for men to take a gap to share in the family responsibilities.” Barker is, however, a little more optimistic: “It is not so much a question of breaking through the glass ceiling—it’s more a question of women defining the landscape of the ceiling once they get up there”.

Prosecutions against charities that do not file their annual report with the Charities Regulator will be ‘the next step’ in the regulation of the sector, writes Colin Kerr The Charities Regulator is calling on non-profit organisations to prioritise compliance and transparency to support public trust at a time of rising regulation in the sector. Published in late July, the Charities Regulator 2021 Annual Report revealed that just 64 percent of registered charities in Ireland had filed their annual reports on time. Commenting on the finding, Helen Martin, Chief Executive of the Charities Regulator, said there had been a decline in the number of charities filing their annual reports within the required timeframe, a trend she called ‘disappointing.’ “Our registration and compliance units are assessing why some charities are failing to meet this statutory requirement,” Martin said. Providing an overview of a charity’s finances and activities on the Public Register of Charities, these annual reports are an “important means” for registered charities to provide basic information to the public, Martin added. “The question for charities is whether they can afford not to comply with the requirement to file annual reports. Funding is the number one concern for charities we surveyed last year, and as inflation brings an increased cost of living, it will remain so,” she said. “There is a strong link between greater transparency and accountability and public trust in the sector, making their annual report to the Charities Regulator an important means for registered charities to provide basic information to the public on their finances and activities in the previous year.” Under the Charities Act 2009, every charity must submit its annual report to the Charities Regulator ten months after its financial year ends. “In 2021, we noticed a drop-off in the rate of compliance with this requirement,” said Tom Mulholland, Director of Compliance and Enforcement with the Charities Regulator. “The Charities Regulator came into existence in 2014 and, every year prior to 2021, the rate of compliance was increasing year-on-year. “We are concerned with the reduction of the number of charities filing their annual reports on time, as this is a legal requirement.” Mulholland pointed out that filing an annual report to the Charities Regulator was not an onerous process. “The report is filed online, and it is a straightforward form, which requires basic figures including income, expenditure, assets, and liabilities. It is an opportunity for charities to give details of the work they carry out,” he said. “There is a free text section on the form, which allows the charity to detail their activities, which means that if someone is looking up a charity on the Register of Charities website (charitiesregulator.ie), they can see from the most recent annual report what the charity itself is saying about its activities.” Those charities that file their annual reports to the regulator were also demonstrating to the public that they were compliant with their obligations. Mulholland said: “This should be a comfort to someone who decides to donate to a charity, and it also allows the donor to get information about the charity in terms of its income, expenditure and activities.” While the Charities Regulator had always been ‘proportionate’ in its interaction with charities, Mulholland said that, in the interest of fairness and due diligence, it had to consider those charities which were making the effort to be compliant when dealing with non-compliant parties. “We are considering our options when dealing with those charities that do not file their annual reports to the Charities Regulator,” he said. “It is possible to remove a charity from the Register of Charities. This has serious consequences–an entity that is not on the register is not permitted to call itself a charity or conduct any charitable work under the Charities Act. “It is also an offence under the Charities Act not to file an annual report with the Charities Regulator and we are actively contemplating acting against those charities that are not compliant,” he said. Mulholland said that the Charities Regulator could opt to prosecute a charity in the District Court. Prosecutions have been taken against entities acting as charities, which are not on the Register of Charities. To date, however, no prosecution has been taken against charities that do not file their annual reports. “The Charities Regulator is evolving and we have been in business since 2014. We take a proportionate response in relation to our interactions with charities and we tend to interact with charities rather than dictate actions to be taken,” Mulholland said. “Having said that, prosecutions against charities, which do not file their annual report with the Charities Regulator, will be the next step in the development of regulation of the sector.” Under the Charities Governance Code, Chartered Accountants looking after the accounts of a charity should have access to the minutes of the meetings of the charity’s trustees. “Accountants working with charities should be able to see these minutes, which should show that the trustees are taking an active part in the running of the charity and that the decisions they make are clear from the minutes,” said Mulholland. “There is also legislation before the Oireachtas, the Charities (Amendment) Bill 2022, which provides for the introduction of accounting regulations in relation to charities, which will supply a format for the preparation of financial statements in relation to charities. The Bill will also herald the introduction of Charities’ Statement of Recommended Practice (SORP) requirements for charities with an income of more than €250,000.” Already in force in Britain, SORP is not yet a requirement in the Republic of Ireland. The Charities Regulator is also continuing to promote the Charities Governance Code, which sets out minimum standards for managing and controlling Irish charities. The code was established to help charity trustees implement processes that meet their legal duties under charity legislation. “The code was rolled out in 2021 and we are pleased with the uptake, which is around 69 percent,” said Mulholland. “One of the aims of the code is to encourage transparency in Irish charities. One of the ways charities can show transparency is through the clarity of their financial statements. “We would also urge charities filing their accounts with the Companies Registration Office to file their full financial statements rather than their abridged statements.” In conclusion, Charities Regulator Chief Executive Helen Martin said that compliance with the Charities Governance Code, and with the requirements of the Charities Regulator, could only benefit individual charities directly. “It is public money that is being spent here,” Martin said, “and everybody from the donors to the Regulator to the charities themselves want to make sure that these funds are spent in a transparent and accountable manner.”

A milestone move to new premises has laid solid foundations for future growth at Crowe Ireland, says Naoise Cosgrove, the firm’s Managing Partner The recent move to new offices on Mespil Road marked an important milestone in the evolution of Crowe, the accountancy, tax and business advisory firm, founded 81 years ago in Dublin. For Naoise Cosgrove, who has been Crowe’s Managing Partner since 2016, the move also signalled the start of an important new phase in the life of a firm with deep roots in Irish business stretching back to 1941. “We have ambitious growth plans and a modern office that serves as a collaborative and social hub is essential to this,” Cosgrove says. “Our new home is a place to teach and learn, to share ideas and develop relationships that are central to our culture.” For Cosgrove, who began his career with Crowe in 1999, the strength of this culture has also been at the heart of his own progression with the firm, spanning two decades in corporate finance. “I see our culture as our greatest asset, and I think I was very fortunate at the outset of my own career to find myself at a firm with great people, and wonderful mentors. I have stayed with Crowe ever since,” he says. The move to Mespil Road also represents a significant investment for the firm. “We had been at our previous office in Marine House further along the Grand Canal since 1978. It was time for a change,” Cosgrove says. “Now, we have a best-in-class environment that allows our people to work collaboratively, share knowledge and ideas, and one that supports our hybrid working model. It is a very different workplace to the one JJ Bastow and Jim Charleton might have imagined when they founded this firm back in 1941, and it positions us for growth at a very exciting time.” Deep roots Originally known as Bastow Charleton, Crowe started life on Cavendish Row, working with cattle dealers attending weekly marts at the Dublin Cattle Market on Prussia Street. The practice established a strong presence in the meat and metal sectors throughout the forties and fifties. When Jim Charleton passed away in the early 1960s, his brother Joe, a tax practitioner, took over his interest in the practice, becoming a driving force in its expansion in the decade that followed. Bastow Charleton expanded further in the late eighties and early nineties, merging with Hogan Kenny Matthews and Clarke and Conroy O’Neill, both Irish firms. In 1995, it joined forces with Horwath International, the global network, to service the needs of clients internationally, rebranding subsequently as Horwath Bastow Charleton and, more recently, as Crowe Ireland. Newmarket Partnership, a specialist corporate firm, joined Crowe Ireland in 2014—followed, in 2015, by Newmarket Consulting, a boutique strategy and marketing consultancy business—and Phelan Prescott + Co, a Dublin-based accountancy firm, the following year. As part of the Crowe Global network, the Dublin firm is one of over 220 independent accounting and advisory members in more than 130 countries worldwide. “Our services are pretty comprehensive. We provide tax, audit, corporate finance, consultancy and outsourcing services,” says Cosgrove. “We work with private clients, sole traders and owner-managed businesses, alongside financial institutions, government agencies, not-for-profit, and multinational organisations.” This broad spectrum is, says Cosgrove, a big part of what makes Crowe Ireland a vibrant organisation. “We have been around for a long time, and I think a lot of our success has been down to our focus on client service—on developing deep lasting relationships with clients and colleagues,” he explains. “We have a holistic understanding of what their business is about. It’s not ever just about simply executing a task. It is about creating real value for them.” Vision for growth Notwithstanding the economic turmoil prompted first by the pandemic and, more recently, the war in Ukraine, Cosgrove is optimistic about the future. “There are clouds on the horizon—inflation, supply chain issues, and rising energy prices—but change is the one constant,” he says. “The Irish economy has been performing well and you would like to think that gives us a strong foundation to move forward, whatever the wider circumstances. Growth through acquisition is something we are looking at. The last time we brought in another practice was in 2017. “We would like to think there will be a level of consolidation in the market, which had maybe been slowed down by the pandemic, and that we will be playing an active role in that. Whether or not it happens in the next 12 months given global events is hard to say.” Corporate finance As well as his role as Managing Partner, Cosgrove also leads the corporate finance team at Crowe Ireland, specialising in the buying and selling of private companies, and acting for purchasers, sellers and funders. “I have always had an interest in business, even back when I was growing up in Waterford. I had a very good accounting teacher at secondary school, and I really enjoyed the subject,” he says. “I did a Business Degree at UCC and, from there, progressed into the world of accounting. I suspect, like many of my peers at the time, I didn’t necessarily know what accounting was all about—there were no accountants in my family—but I found I really enjoyed it. “I trained with Deloitte, in an audit environment mainly. I was fortunate enough to have a number of secondments during those four years, and I was keen to get into corporate finance.” In his corporate finance work with Crowe in the years since, Cosgrove has led transactions ranging from trade sales to private equity and MBOs, advising clients on strategy, valuations, joint ventures, finance negotiation, transaction structuring, and due diligence. “I enjoy being involved in deals and transactions—being able to make an impact, maximise value and look to the future for the businesses I work with, rather than in the rear-view mirror,” he says. Attracting talent Crowe Ireland currently has 14 partners and employs 140 people—and the firm is continuing to grow, recently appointing Aidan Ryan as a director of its audit and assurance department. A Chartered Accountant, Ryan joins Crowe from Moore where he was Audit Director for three years, having joined the firm in 2008. “We are very active in terms of recruiting at the moment across all departments—that is a constant,” says Cosgrove. “There is huge demand for talent. Everybody is feeling it. We get natural enquiry through the positioning we have in the market, through word-of-mouth and referrals. Attracting talent can still be challenging, however, and that has been exacerbated by COVID-19. “Now more than ever, I think the culture of an organisation really matters. The world has become very transactional in terms of how people connect and communicate. We interact in a very scheduled way through Zoom and Teams calls. We log on, we log off. There isn’t necessarily much room in that for the spontaneous ‘watercooler moments’ that can help to establish and build working relationships in a more organic way.” Crowe’s response has been to consciously create forums at its new Mespil Road premises that help people to feel more connected to the organisation and to each other, Cosgrove says. The office was officially opened last July by Minister for Finance Paschal Donohoe, TD. “Our investment in our office has centred on creating an open, inviting space, to give people a sense of the wider organisation and their part in it,” says Cosgrove. “We know that people need a reason to come into the office now. For some, that’s about learning. For others, it is about social connection. These are the forums we’ve focused on to help people feel more connected to the organisation and to each other.”

Julia Rowan answers your management, leadership, and team development questions I manage a large team which is split into three functions, each with a Team Leader, but I end up doing a lot of the TLs’ work.  When there is an issue to be resolved, they will summarise it in an email and ask ‘what do you want me to do?’. I have spoken to them about this several times, but they keep doing it. There are words, and there are actions. And ‘actions speak louder than words.’ A lovely pattern has been established here: they ask you for guidance, you tell them they shouldn’t—but you give it anyway. And off we go again. The longer this has been going on, the longer it will take to change it. You may need to be patient while a new pattern is established. Email is a lovely place to avoid conversation, so the first step might be to reply to these messages with something like ‘Delighted to talk this through with you—when suits?’. Then have a few great questions ready: ‘what’s important in this situation?’, ‘what are your options here?’, ‘how can I support you with this?’. These questions encourage the TLs to think through the issue themselves, while you offer support. If this does not change the pattern, you could reflect on what might be sustaining their dependency on you and ask questions about that: ‘We’ve talked about this a few times, and I notice you are still coming to me for direction. I feel that your instincts are good and I’m wondering what’s preventing you from suggesting a way forward / tackling this yourself….?’. If you meet with your three TLs as a group—which I hope you do regularly—you could make this an agenda point, encouraging them to report in on successes and challenges, supporting them in advising each other, etc.  Remember, they need to create a new pattern with their team members too. Two members of my team have had a dispute and are refusing to talk to each other or work together. It arose out of a simple enough miscommunication with ‘fault’ on both sides. I have been acting as a go-between in the hope that the situation would resolve itself, but it hasn’t. Team meetings have become very difficult as nobody speaks. Often there is huge hurt behind conflict – so go tenderly in this space. You could begin by reflecting on ‘what is reasonable?’. Is it reasonable for two adults (in their roles, on their salaries) to refuse to engage with each other in a way that other people must pick up the pieces? I might also reflect—as you are—on whether I am colluding with them and keeping the dynamic going. You could talk to them about the impact their behaviour is having on you and the rest of the team. Have a reasonable ‘ask’ worked out in advance. Offer support, or to get support (e.g. from HR), but be led by the requirements of the role. Make sure to notice, and give feedback in response to, even small improvements. But, be prepared for one, or both, to move on. If you read one thing... Turn the Ship Around – A true story of turning followers into leaders  by  David Marquet. Marquet was made commander of a submarine he had not been trained to run and had to rely on his crew—a huge challenge in a ‘command and control’ culture. You can find him on YouTube—‘What is leadership with David Marquet’. I recommend the animated Mindspring version. Julia Rowan is Principal Consultant at Performance Matters, a leadership team and development consultancy. To send a question to Julia, email julia@performancematters.ie

The Pensions Authority expects all schemes to be fully compliant with IORP II requirements by 1 January 2023. We speak to three members about their experience with the changing pensions landscape Barry Prendiville Director Nolan & Partners We are currently setting up a Master Trust arrangement for all employees, including those who are not currently in an existing pension arrangement. We were prompted to accelerate this process due to IORP II and, to a lesser extent, auto-enrolment. It has been a slower process than we would have liked, but it offers a suitable long-term solution. At a high level, there are benefits to IORP II. However, I do believe that one-member arrangements should have been exempt from the requirement to comply with IORP II. Trustee responsibilities have become much more onerous. Where possible and practical, it makes sense to outsource this risk to suitably qualified pensioneer trustees. I am concerned that transferring pension benefits accrued by employees to a new Master Trust may be a tedious process. Given prevailing volatility in financial markets, any transfers need to be efficiently managed. Pensions remain a mystery to a large cohort of the population. The myriad of pension arrangements in place and the technical jargon used by most in the industry confounds and confuses people. Education is key, and I think that retirement planning should be taught at school and university level. While a positive step overall, I have some concerns that auto-enrolment, once introduced, may lull scheme members into a false sense of security. It is debatable if the proposed contribution level will be adequate to meet long-term income requirements in retirement. It will also put an additional cost burden on businesses in particular sectors that were most particularly exposed to COVID-19. Overall, auto-enrolment should be seen as a positive development, but it must be clearly communicated and explained in jargon-free language. Damian Cooper Head of Private Clients and Investments Acuvest The burden of increasing regulation is unlikely to reverse any time soon. For the last two years, my organisation has been helping clients understand, develop, and implement updates to their policies and procedures to ensure their pension and investment governance complies with the new regulatory requirements. It is important to remember that, while Master Trust solutions offered in the marketplace are being strongly promoted based on their ability to help companies and trustees overcome a short-term regulatory hurdle, they are a relatively new development in the Irish market and, as such, are largely unproven in many respects. While the Pensions Authority is pushing for Master Trusts to retain the ability to independently select its key service providers in the interests of its members, it remains to be seen how easy it will be for a Master Trust to decide that the interests of members are best served by retaining a key competitor to provide scheme investment or administrative services. I think that IORP II will likely lead to a higher level of governance across the pensions industry, which is definitely to be welcomed. The transitionary period into a new regulatory regime is always challenging, and participants, regulators, professional service providers and advisors will all need time to adapt and find a new status quo that works effectively and efficiently. I think it would have been preferable to see if the regulations could have been implemented in a phased manner, starting with the largest schemes and well-resourced entities such as Master Trusts, which would then have allowed industry providers to develop best-practice models that the Pensions Authority could have assessed and then implemented, potentially in a scale-adjusted manner across the rest of the industry. It is important for people not to get too distracted by the industry focus on regulation and vehicles, as these will get sorted over time. The key thing to remember is that making pension contributions early and often is a valuable, tax-efficient way for people to save for retirement. Employees should take maximum advantage of any contributions available from their employer, remember that tax relief on contributions cannot generally be backdated, and start saving as early as possible. Bernard Barron Pensions Audit Partner Mazars Due to the recent legal enactment of the IORP II Directive in Ireland, there are very substantial additional pension administration and governance obligations and costs being incurred by pension schemes. Based on these expected additional costs, several smaller defined contribution pension schemes have already decided to wind-up and transfer their pension scheme arrangements into a Master Trust. The Irish Pensions Authority has set out strict criteria for establishing Master Trusts in Ireland, which is to be welcomed. There will be relatively few Master Trusts set up, and organisations expect to gain the advantage of lower administration costs through the economies of scale that these large Master Trusts will have compared to the smaller pension schemes. In addition, the Pensions Authority has set out stricter requirements for pension scheme trustees, and Master Trusts will have the benefit of pension specialists acting as trustees, which is not necessarily the case at present. Due to the increased size and importance of pension scheme arrangements for employees and employers, the increased governance and accountability requirements under this Directive are welcome. However, the currently proposed Pensions Authority requirements is imposing very significant obligations and costs on smaller and one-member pension schemes, which are not being allowed to implement on a proportionate basis or with a viable alternative. The IORP II Directive has substantial additional pension administration, governance obligations and costs. This may cause organisations to re-consider the pension benefits that they incur or plan to incur. In the context of the growth in the ageing of the Irish population, the Government’s plans for implementing pension auto-enrolment in the short- to medium-term are welcome. However, much more clarity and detail are needed about how this is going to work, particularly in relation to cost and funding by employees and employers. At a national level, the future increased costs and funding of pensions for those pensioners who are reliant on state pensions and for the public sector is a continuing concern.

The use of malicious software to extort small businesses is on the rise in Ireland as global criminals seek out easier prey. Arlene Harris reports Ransomware. At a time of rising awareness of cyberthreats and the need for adequate safeguards across all business functions, including finance, ransomware is emerging as a growing threat for even the smallest operators. And, according to Dr Richard Browne, Director of the National Cyber Security Centre (NCSC), ransomware is “here to stay”. A form of extortion “as old as the hills”, ransomware is a type of malicious software designed to block access to a computer system until a sum of money is paid, explained Browne. What is new in the field is a concerning rise in the number of ransomware attacks recently aimed at small- and medium-enterprises (SMEs), a segment of Irish business so far largely unaffected by this particular cyberthreat. Indeed, a statement issued in August by the NCSC in conjunction with the Garda National Cyber Crime Bureau warned SMEs that, in a noticeable shift in ransomware tactics, hackers were turning their attention away from big business and government entities to focus instead on smaller businesses. “This trend has been observed globally and Ireland is no exception, with several businesses becoming victims of these groups in the past number of weeks,” said Browne. “A number of different business models are typically used, which involve encryption of a victims data by a threat actor, whether that is a criminal gang or a lone individual.” Greater threat in newer tactics Cybersecurity has, by and large, kept pace with criminal activity online until now and experts are quite adept at dealing with established ransomware practices—which typically involve a threat actor making contact with a victim, and requesting a key to unlock or decrypt the victim’s information. The threat landscape is evolving, however, leading to newer ransomware tactics that are more difficult to defend against. “Recently, human-operated ransomware has been developed, which means there is a person in the loop with more advanced techniques,” Browne explained. “They hack into a system—or across it, in many cases—steal data and seek to encrypt an entire IT system. The old-fashioned ransomware ‘drive-by’ (often caused by clicking on a link) is not a massive threat as it can usually be stopped by anti-virus software, but human-operated ransomware is categorically a risk for businesses of any kind.” Behind the rise of human-operated ransomware are often established, integrated and organised criminal enterprises that operate “at scale and at speed” globally, Browne said. “This is very much a global market, with the ‘bad guys’ targeting IP addresses anywhere in the world,” he said. “Over the years, many have been heavily compromised, but, while their organisations have been broken up, the individuals involved are still criminals and they are still capable of conducting cyberattacks, so they tend to simply reform and go after smaller targets.” Criminals target smaller players While large corporations are more likely to have the financial means, technology and expertise to handle a sophisticated ransomware attack, the same cannot be said for many of their smaller counterparts. “Because of changes in the ecosystem, smaller companies are getting hit more often than bigger entities, which can afford to be prepared, are more resilient and much more able to deal with incidents when they occur,” Browne said. “So, [the hackers] are going after SMEs and individual companies, which might only net them a smaller ransom, but they are much more likely to be paid. “It is also easier. They don’t have to spend as much time navigating systems and don’t have to be as careful as they would with high-end security systems, so they can target more small companies. “Solicitors’ offices, for example, will often have sensitive data on file—so it is in their interest to pay not to have it released. “The criminals may also gain access to customer money sitting in a firm’s account over a weekend (for lodgement the following week), which makes them a target for other activities, such as fraud. “Of course, there have been some very high-profile attacks too, such as the Colonial Pipeline attack in the US, which took out a piece of physical infrastructure without actually damaging or physically affecting it. JBS Meats is another one and the HSE is probably the most well-known here in Ireland.” These ransomware attacks are happening “all the time”, said Browne, both in Ireland and elsewhere. “Just today, I’ve had reports of about 15 new ransomware attacks in Europe over a few days. We, in Ireland, are relatively lucky as we are something of a small player, but we are at risk nonetheless.” While criminal gangs are set to continue making money by hacking into IT systems, harvesting data and selling it on, or blackmailing companies into paying a ransom, Browne advises that there are steps SMEs can take to protect themselves from ransomware attacks. Effective security measures “We appreciate that many business owners are understandably nervous about the threat ransomware poses, but some straightforward security measures can be put in place to ensure that an organisation’s data and systems remain secure,” he said. “Some SMEs won’t have an IT system as it will be outsourced, so the first thing they need to do is to ask their vendor how prepared they are for dealing with this kind of thing.” At the very least, businesses should have two-factor identification on all of their online accounts—whether it be Facebook, Gmail or a financial services package. “It sounds simple, but, if everyone did this, it would dramatically reduce the amount of damage done,” said Browne. “After that, I would encourage firms to ensure their vendor has proper offline back-up and, internally, to decide that—on a specific day of the week—someone will be tasked with taking the external hard-drive, making a copy of it, and putting it away. “This way, they will have a secure offline system so, if they need to restore it after an incident, it can be done without taking down the company. “Beyond that, they should have an up-to-date antivirus system and ensure any vulnerabilities are patched up.” Making these provisions is becoming more essential for SMEs because ransomware, as Browne puts it, “isn’t going away”. “People need to be vigilant and governments need to do more to deal with it and ensure these guys don’t get paid, so that, eventually, it will become less prevalent,” he said. “That’s not going to happen overnight. It is going to continue to be an issue for some time. We all need to be aware and take steps to keep our systems secure.” For more advice and information, visit ncsc.gov.ie or garda.ie/en/crime/cyber-crime

The Corporate Enforcement Authority Act 2021 overhauled the legislative framework for businesses in Ireland, impacting company directors, corporate restructuring, share premiums, and the distribution of profits. Dee Moran and Lilian Halpin dig into the details Although most of the provisions of the Companies (Corporate Enforcement Authority) Act 2021 (CEA Act) came into effect in July of this year, the focus thus far has centred primarily on the Corporate Enforcement Authority, the successor to the Office of the Director of Corporate Enforcement. There is far more to this Act, however, including a number of interesting updates the Companies Act 2014 (CA 2014). The introduction of the CA 2014, followed the wide-ranging overhaul, modernisation and streamlining of company law in Ireland. It was inevitable, however, that there would be some gaps and omissions in the new regime. The CEA Act introduces provisions aimed at remedying some of these anomalies. While further remediative legislation is expected in the future as the legislature continues to review and refine existing law, in this article, our focus will be the amendments included by the CEA Act impacting company directors, company re-organisation, share premiums, and the distribution of profits. Requirement for directors to provide PPSN details Section 35 of the CEA Act introduces the requirement for directors of Irish registered companies to provide details of their Personal Public Service Number (PPSN) to the Companies Registration Office (CRO) when completing certain documents. While this section of the CEA Act has not at time of writing commenced, it is intended to help protect against identity theft, specifically concerning the set-up of new companies that have used bogus director details and addresses or individual names without permission. The UK’s register of businesses and their directors is famously so weak on information verification that both “Donald Duck” and “Adolf Tooth Fairy Hitler” have been listed as directors of companies. Other difficulties faced prior to this amendment included obtaining a list of directorships for an individual from the CRO as individual director filings may use different versions of the person’s name, such as ‘Eddie’ and ‘Edward’, or the person may have changed address. The introduction of the requirement to file the PPSN as a unique identifier should, therefore, make this process easier. It is important to note that there will be an alternative procedure in place for those directors who do not have a PPSN. The CRO is currently reconfiguring its online portal to accommodate this new requirement and it is expected that Section 35 will commence in the first quarter of 2023. Its implementation will not be without challenge and the CRO has set up a working group to identify issues and try to resolve them to ensure a smoother transition. The CRO is also reviewing the technical challenges that arose after the commencement in 2019 of the Registry of Beneficial Ownership (RBO). The RBO is “the central repository of statutory information required to be held by relevant entities (corporate or legal entities incorporated in the State) in respect of the natural persons who are their beneficial owners/controllers, including details of the beneficial interests held by them.” It is hoped that the CRO will take the learnings from this review and incorporate them into the new system. It is important that potential technical challenges in relation to PPSNs are resolved before section 35 of the CEA Act commences. If they are not properly considered, there is the potential for delays in the filing of changes to directors or to the filing of annual returns, and the possibility of late filing fees or the loss of audit exemption. Therefore, companies and practitioners alike need to be aware of these changes and to begin to make plans to ensure that the appropriate information is understood and updated. Three party share-for-undertaking transactions The provision for three party share-for-undertaking transactions within corporate reorganisations was introduced in section 91 of CA 2014. This section recognised that it is not uncommon for companies to enter into a transaction where an undertaking, part of an undertaking, or a subsidiary, is transferred to a new company, which then issues shares as consideration to the shareholders, rather than to the transferring company. Subsection 91(4) of CA 2014 has, however, been interpreted by certain practitioners to mean that such a transaction could only be validated by either a summary approval procedure or a special resolution confirmed by court—even where the company has adequate distributable reserves to underpin the transaction. The CEA Act has added subsection 91(4)(c) to clarify that such a transaction can take place without the summary approval procedure, or court approval, in circumstances where the company has distributable reserves that are at least equal to the value of the undertaking transferred. The use of a company’s share premium account Under the Companies Act 1963, a company’s share premium account could be applied for several purposes, such as application by the company in writing off preliminary expenses, or in writing off the expenses of, or the commission paid or discount allowed on, any issue of the shares or debentures of the company. Equivalent provisions were not included in CA 2014 in what was assumed to be an unintended omission by the drafters. This reduced the flexibility of companies in relation to the use of share premiums, causing difficulties. A company wishing to effect a transaction which had been permissible under the Companies Act 1963 was now, for example, obliged to carry out a formal reduction of company capital by the summary approval procedure in CA 2014. This meant that the company might have incurred additional expense, such as obtaining a statutory auditors’ report, or that it might have had to make a court application in circumstances where such a move would not previously have been required. In addition, because the summary approval procedure is not available for the reduction of company capital in the case of public limited companies, such a company had to apply to the High Court in order to reduce its company capital so it could write off such costs and expenses. To remedy this, section 14 of the CEA Act inserts a new subsection 71(5A) into the CA 2014. This subsection restores the status quo that had existed prior to the introduction of the CA 2014, with the exception of permitting its use for the issue of shares at a discount. Restoration of exceptions to “distribution” definition In the since repealed Companies (Amendment) Act 1983, company legislation provided for two exceptions to the rule that a company should not make a distribution except out of profits available for this purpose. They were: a reduction of share capital by paying off paid up share capital; and extinguishing or reducing all or part of a member’s liability on shares that are not fully paid up. These exceptions were not included in CA 2014 and it is worth noting that these omissions were considered and not unintentional. Both exceptions were included in draft legislation but were subsequently removed before CA 2014 was enacted. The effect of the omission of the exceptions meant that a company had to find distributable profits to be able to lawfully reduce or extinguish the liability of members in respect of any unpaid shares, or to pay off paid-up capital. The explanatory memorandum to CA 2014 refers to the omission of the exceptions as providing consistency in the legislation. However, in 2017, the Company Law Review Group—a statutory advisory expert body that advises the Minister on the review and development of Irish company law—was of the opinion that the omission of the two exceptions in the CA 2014 did not take into account the new and detailed regime in that legislation for the reduction of share capital, i.e. requiring either a court order, or to be effected under the summary approval procedure with contingent director liability. It recommended that the two exceptions which had been omitted from CA 2014 be reinstated. Section 19 of the CEA Act has now amended section 123 of CA 2014 to reinstate these exceptions. Planning for the changes ahead It is encouraging that improvements and clarifications continue to be made to legislation, particularly in company law where omissions or inadvertent changes from older legislation have resulted in difficulties in practice. Chartered Accountants Ireland continues to work with its technical committees to identify areas where further clarity on aspects of company law would be beneficial and to make representations to the relevant department outlining those areas so that they might be considered for future legislation. Dee Moran is Professional Accountancy Lead at Chartered Accountants Ireland and Lilian Halpin is Technical Manager at Chartered Accountants Ireland

Investors are asking if it’s safe to invest again. Cormac Lucey explains why they might want to hold off for now “Is it safe?” That was the question asked of Dustin Hoffman in the movie “Marathon Man” as he was being interrogated while strapped into a dentist’s chair by Laurence Olivier (playing the role of an on-the-run Nazi war criminal), expertly reimagining our worst dentist nightmares. Much like Hoffman’s position, equity markets have become a nightmare. Investors keep asking themselves whether it is safe to invest again or whether this bear market has longer to run. Jeremy Grantham, the veteran investor, wrote an article on GMO.com in late August warning that the “current super-bubble features an unprecedentedly dangerous mix of cross-asset overvaluation (with bonds, housing, and stocks all critically overpriced and now rapidly losing momentum), commodity shock, and Fed hawkishness.” He concluded that we haven’t yet seen the bottom. Having pumped vast amounts of liquidity into the world economy to stave off the deflationary effects of the pandemic in 2020, central bankers were shocked by the firm inflationary response. They responded by tightening monetary policy – the usual precursor of recessions. It’s important to note that this move pre-dated the Russian invasion of Ukraine with its resultant economic disruption, and even more important to note that the conflict in Ukraine has fundamentally changed the rules of the economic game we had become used to. Zoltan Pozsar of Credit Suisse has written that, in recent decades, “the EU paid euros for cheap Russian gas, the US paid US dollars for cheap Chinese imports, and Russia and China dutifully recycled their earnings into G7 claims.” The problem is that global supply chains work only in peacetime, “but not when the world is at war,” Pozsar notes. While Russia is currently being forcibly disentangled from trade with the west, China may decide to voluntarily and slowly remove itself to avoid the shock of aggressive disentanglement should its cold war with Taiwan ever turn hot. Key monetary indicators remain recessionary. In the US, money supply is growing at a slower pace than inflation, meaning the real quantity of money in the economy is falling. The yield curve has just inverted, meaning short-term (two-year) rates of interest exceed long-term (10-year) rates. For several decades, this has been an unerringly accurate harbinger of recession. Unfortunately, central banks remain in tightening mode for those wanting equity markets to lift as inflationary pressures prove to be more than just “transitory.” They say, “Don’t fight the Fed” (the Federal Reserve) and with good reason. Caution is warranted. There are other challenges facing equities. On previous occasions over the last two decades, the depth of downturns has been eased by the fact that not all large economic blocs have been in recession at the same time. In the wake of the Global Financial Crisis, when the western world was in deep recession, strong growth in China helped ameliorate the global impact of the recession and accelerate its ending. Today, all major economic blocs are simultaneously threatened by recession, which risks making this recession deeper and longer. What might signal an equity market bottom? I’ll be looking for a combination of value, investor sentiment, and a change in central bank behaviour. Share prices would need to drop sufficiently to be reasonable value. In 2000 and 2007, this required price drops of the order of 50 percent or greater. Speculative sentiment among investors would need to be replaced by the cold fear that characterises true market bottoms and central banks would need to replace tightening with easing. A halting of central bank tightening would certainly trigger considerable euphoria. But, having been too slow to tighten, central bankers cannot risk their diminished credibility by taking their feet off the monetary brake before inflationary pressures have been well and truly suppressed. Remember: the Nasdaq crash kept deepening two decades ago, even after the Fed had started aggressively cutting interest rates. So, is it safe? I don’t think so. Cormac Lucey is an economic commentator and lecturer at Chartered Accountants Ireland

The absence of a global baseline for reporting sustainability-related information is a concern for many, as the number of signatories to a global call-to-action on the matter demonstrates, writes Fiona Gaskin In late August, 65 companies, investors, and professional accounting firms from around the world added their voices to the call for standard-setting efforts to more closely support a global baseline for reporting sustainability-related information. All were signatories to a statement issued jointly by the International Federation of Accountants, World Business Council for Sustainable Development, and Principles for Responsible Investment, seeking to establish greater compatibility between the concepts, terminologies, and metrics in use in current draft standards for sustainability reporting. The statement acknowledged the important work of the International Sustainability Standards Board, US Securities and Exchange Commission, and the European Commission, together with the European Financial Reporting Advisory Group, in their efforts to advance sustainability reporting. The number of organisations supporting the call for the convergence of standards demonstrates, however, that the absence of a global baseline for reporting sustainability-related information is a concern for many corporates, financial institutions, and professional services organisations. The problem is very real. When various jurisdictions and standard-setters issue concurrent, but differing, standards, the users of those standards are left with varying frameworks, which can be costly and inefficient to interpret and implement. These efforts, while well-intentioned, can create confusion by adding more noise as reporting multiplies, but with different standards and objectives. A fundamental question for those setting standards and regulations is the question of whether or not reporting should be focused on information useful to investors (i.e. the enterprise value), or information useful to a wider group of stakeholders (i.e. the impact value). Enterprise value primarily focuses on the impact of environmental, social and governance (ESG) issues on business—in other words, how does the world affect the organisation? Impact value focuses more on the impact the organisation has on the world around it. Both enterprise and impact value offer information that can help to hold companies accountable for their actions—whether that is to maintain or create value, or to minimise negative impacts on the planet and society. Indeed, it is possible to argue that there is really no practical difference between these two values, and that the exposure draft of the International Sustainability Standards Board’s general disclosure requirements standard already provides a few good examples. This is because it is reasonable to expect that a business operating in a way that has a negative impact on the planet and its people will—in the short-, medium- and long-term—have a negative impact on the business itself and, therefore, on its enterprise value. In the long run, which is where sustainability standards focus, enterprise value and impact align. We can see first-hand that the proposed range of emerging standards are already proving to be a challenge for corporates. To start, there is the difficulty in simply gaining clarity on the reporting landscape—what has to be reported on, and by when. Once this has been established, the need arises for an exercise in understanding the crossover between reporting obligations—in the area of metrics, for example. These requirements then need to be assessed against what the organisation is actually doing and reporting. This last step typically results in an action plan which requires time and resources to address the underlying actions. While the statement calling for stronger alignment of regulatory and standard-setting efforts around sustainability disclosure has wide-ranging support, those creating the regulations and standards will ultimately need to continue to collaborate and respond to the call to action. Given that we are at the infancy stage of sustainability reporting when compared to financial reporting, it would seem like such a wasted opportunity to create complexity when standardisation and transparency are what is needed. Fiona Gaskin is Environmental, Social and Governance Leader for Assurance and Reporting at PwC Ireland

With the launch of ‘The Garage’, Pfizer Global Business Services Dublin is helping accounting trainees discover how they can apply digital technology to make their work faster and easier It started with a conversation between colleagues about how their profession might evolve at a time of immense digital transformation, and how they might harness this transformative power to support their fast-growing Dublin enterprise. Aoife Allen, FCA and Senior Director with Pfizer Global Business Services Dublin (GBS Dublin) recalls: “It was three years ago, and we were thinking about how we would be working in the future. I remember the question was, ‘what will our future colleague look five or 10 years from now?’” At the time, Albert Bourla, Chair and CEO of Pfizer Inc, had set a challenge for the organisation globally to “win the digital race in pharma,” and Allen and her colleague John Anglim were overseeing a successful graduate programme for Pfizer GBS Dublin in association with Chartered Accountants Ireland. “Our graduate programme was really starting to ramp-up then, in terms of numbers—a cohort of younger colleagues who had grown up with digital technologies, and we wanted to find a way to help them explore how we could use digital technology to make our own processes more efficient and effective, with an enhanced control environment.” ‘The Garage’ – a digital innovation program So began ‘The Garage’, a one-hour weekly session, during which Chartered Accountant trainees were encouraged to explore how they might use digital technologies to make their work more efficient and easier to manage. “We challenged them to come up with a project idea, and then to build it. It was about teaching our graduates how to think differently and pass their learnings on to the wider organisation, so that we could harness the power of digital to improve how we worked together within the organisation,” John Anglim, Director, Pfizer GBS Dublin, explains. The Garage is an innovative applied learning program, developed and led by Pfizer GBS Dublin colleagues Colin Byrnes, Director of Global Process Transformation, and Lorna Flanagan, Director Statutory Reporting CoE. Nurturing the digital mindset “The idea behind the program was really about recognising a need to nurture and develop our graduates’ skill sets in working with digital tools and technologies as they progress through their accountancy training,” Colin Byrnes explains. “Our Garage sessions take our graduates through concepts such as design thinking, analytics and problem-solving, as well as introductions to some of the technologies we use, like Alteryx, Tableau, Dataiku and Power Automate.” As Lorna Flanagan sees it, The Garage is about equipping the accountant of today for their evolving role as the ‘accountant of the future’. “The role of the accountant has really moved on from repetitive tasks to providing higher value-add services,” she says. “Our hope is that The Garage will set our graduates up to support problem-solving at Pfizer GBS and also enhance their accountancy training experience, so that we can support them to become our ‘colleague of the future’.” Impressive results So far, The Garage has yielded impressive results, with participants using new technologies, like Robotic Process Automation, Visualisation and Predictive Analytics, to build innovative solutions for Pfizer GBS Dublin and the wider organisation. One such participant is Reza Shahrokhi, as Aoife Allen explains: “Reza’s project concerned an incredibly time-consuming process that was used by managers right across Pfizer to review Authorised Signature Limits (ASLs). “Every year, these managers had to coordinate the review of thousands of ASLs on large Excel files via email. It was an incredibly time-consuming and manual process and, through his participation in Garage, Reza found a solution that was adapted for use across the entire organisation.” Shahrokhi’s solution used Power Automate, a tool that integrates Microsoft applications such as Excel, Outlook, Teams and more, to simplify the ASL review process. “He effectively removed emails from the process, collating responses from managers in seconds and automatically updating files, reducing errors and time for follow-up,” explains Flanagan. “Reza presented his project to GBS Dublin leaders and departments, showcasing his work at a GBS Dublin Innovation Forum where he was awarded one of 10 Innovation Awards in 2021. Reza really exemplified the Pfizer goal to win the digital race in pharma by making our work faster and easier. He explored and defined the problem and leveraged technology to improve the efficiency and effectiveness of a manual process.” Automating journal entries Another successful Garage project by graduate trainee Kate Connell leveraged digital technology to automate the manual month-end journal entry process. “Kate’s project explored a recurring issue whereby a manual journal had to be booked monthly to reclass original banking entries in the SAP accounting system to certain division- or market-coded accounts,” Lorna Flanagan explains. “The process was taking two hours to post manually each month. By navigating and preparing a ‘process flow map’ and exploring the functionality of the Alteryx tool, Kate was able to apply a digital workflow to automate the preparation of the final journal.” Connell’s project was showcased to GBS Dublin leadership and, as a result, different departments were able to leverage the technology to automate repetitive manual journal entries. Digital workflow solution Ian Banahan, meanwhile, used his participation in Garage to identify a digital workflow solution for an important financial supply chain process. “Graduates who take part in The Garage are asked to identify a work activity they see as relatively simple but feel could be improved. The idea is to create a ‘focus’ for practical learning during the Garage sessions,” explains Colin Byrnes. “In his day-to-day work, Ian was involved in a process whereby the GBS Dublin team calculates and communicates critical financial information to country teams supporting the financial global supply chain and distribution of products. “While the process was robust and utilised the latest digital technologies to help calculate processes, Ian could see that there was still a lot of manual communication involved—via emails, for example.” As part of his Garage project, Banahan documented the flow of information exchange involved in the process, uncovering challenges with information tracking and management. “Ian used the Garage network to identify digital workflow tools that could potentially address these issues, assessed them and drafted recommendations. He presented his findings to GBS Dublin leadership and got approval to move ahead with the project,” says Byrnes. “Since then, the Global Process Lead responsible for this area has developed the proposal further and the plan is to start implementing Ian’s solution by the end of this year.” The future of Garage Originally introduced in 2021, the 12-week Garage programme is now entering its third cycle and, for the first time, will be open to all Dublin GBS colleagues in addition to graduate trainees. For Aoife Allen, the success of the initiatives is a point of pride. “I am very proud of The Garage. A lot of the projects that have come out of it have brought real value to the organisation, and to our day-to-day work as Chartered Accountants and financial professionals,” she says. “These accounting problems and projects are so specific to the activities we are involved in that, really, only we can fully understand and solve them. “By giving our graduates—and now our wider team—the tools they need, they are able to look at accounting processes and say with confidence, ‘I can automate this process, and then spend my working time using the information it’s giving me to carry out work that is far more valuable. “They are effectively solving day-to-day end-user problems and that is empowering, because it encourages them to think differently about how they, and how we as an organisation, approach our activities.” History of innovation Pfizer has a deeply rooted history of innovation in Ireland. One of the first pharmaceutical companies to establish a base in Ireland, the organisation celebrated its 50th anniversary here in 2019 and now employs 4,000 people at five locations in Cork, Dublin, and Kildare. GBS Dublin was established in 2003 and provides end-to-end financial accounting services, compliance oversight, and business transformation support to Pfizer operations spanning 150 markets worldwide. As such, says Allen, GBS Dublin acts as Pfizer’s own ‘in-house’ accounting firm with the same high-value capability and talent resource. “That is how we see ourselves, and what we have responsibility for are the complex, high-risk and knowledge-based accounting transactions that support Pfizer’s financial operations globally as well as regionally here in Ireland,” she says. GBS Dublin is also among the biggest employers of Chartered Accountants in the Irish market outside the Big Four accounting firms. “We are very fortunate to have access to such a big pool of very talented candidates who have a really good reputation internationally,” Allen says. “We have a young, qualified, educated, and diverse workforce. We have many different nationalities here; people who speak many different languages; who have experience in different local Generally Accepted Accounting Principles. “This means that we are able to provide an international organisation with financial support from here in Dublin, and we also now manage in-market colleagues responsible for statutory and fiduciary duties.” Evolving role of the accountant For Allen, who grew up in Wexford and trained as a Chartered Accountant with PwC, her time with GBS Dublin has allowed her to carve out a varied and satisfying career path. “I joined GBS Dublin 16 years ago as an accountant after living and working in Australia for a while after qualifying. Since joining, I’ve changed roles eight times. I have had so many opportunities. “After joining as an accountant, I became team lead, and then regional team lead, and progressed from there to a director role and, most recently, senior director, with colleagues from 41 countries reporting into my organisation.” In the years since she began her own career, Allen has also borne witness to the evolving role of accountants in all sectors. “How we do our job on a day-to-day basis now is very different to how it was when I trained. Great change is underway within the profession of accountancy and that change is being driven by digital technologies,” she says. “We have access now to digital tools—not just these big Enterprise Resource Planning systems like SAP and Oracle—but also end-user technologies like Alteryx, Dataiku and Power Automate. These tools are allowing accountants to carry out our work in new and different ways and creating the potential for real innovation.” Breakthroughs that change lives This innovation is at the heart of the GBS Dublin ethos and the driving motivation behind The Garage and other digital initiatives. “We have an amazing wealth of talent here in our own workforce in Dublin and, at the same time, access to these emerging digital tools that can really transform the way they work and add value to the wider organisation,” says Allen. “We reckon about 75 percent of the people working for Pfizer GBS Dublin have a qualification in accountancy, tax, or another high-value profession. Our colleagues are highly qualified and highly capable people, and we are part of Pfizer; a company whose purpose is to drive ‘breakthroughs that change patients’ lives’.” “Our own purpose and responsibility here at GBS Dublin, as I see it, is to employ that same ethos as an enabling function to the wider organisation and—just as our colleagues in science and manufacturing do—to use innovation to drive breakthroughs. “Being a truly innovative organisation involves learning to do things differently, being open to change, and being prepared for a future of constant change.” For Allen, meanwhile, how she approaches her leadership role as a Senior Director at Pfizer Dublin GBS is also changing. “What I’m learning is that, as a leader, you have to get out of the way. You have to give people the space to come up with ideas and to share them. You have to ask everyone to contribute, to listen and encourage all of their ideas. “That means listening equally to everyone in a meeting, from graduate right up to director level. I want to hear what the graduate has to say as much as I want to hear what the director has to say. You must listen, because absolutely everyone can bring something really valuable to the table.”

In a candidate-led market, how an organisation is perceived can be critical to its ability to attract the very best professionals. Although employers can’t create their own brand, they can do a lot to influence it. Dr Mary E. Collins explains how When recruiting, your reputation or ‘employer brand’—the stand-out differentiator for your organisation—has never been more important. This renewed focus on employer brand can be attributed, in part, to the expectations of the younger generations, who are influenced by an organisation’s reputation and peer reviews. These reviews—and the perception of an employer’s brand they help perpetuate—are a key disruptive element in recruitment, particularly with the growth in influence of review and recruiting websites, such as Glassdoor and Indeed. The Labour Force Survey results from the Central Statistics Office for the second quarter of 2022 put the employment rate in Ireland among 15- to 64-year olds at 73.5 percent – a record high. In this context, an organisation’s ability to attract and retain talented professionals in a market at near full employment—one in which people naturally have greater choice—does more than allow it to compete. It affects its reputation among all stakeholders, from customers and clients to potential employees. What is an employer brand? The term ‘employer brand’ was coined in 1996 by Professor Tim Ambler of the London Business School, who defined it as “the package of functional, economic and psychological benefits provided by employment and identified with the employing company.” The Chartered Institute of Personnel and Development (CIPD) defines an employer brand as “a set of attributes and qualities—often intangible—that makes an organisation distinctive, promises a particular kind of employment experience, and appeals to those people who will thrive and perform best in its culture.” It is important to note, however, that an employer brand is created by other people’s perceptions of an organisation. An employer cannot directly create its employer brand, it can only influence it. The power of employee review In the past, an employer brand (even if not described as such) was based mainly on the reputation of the employer, with very little influence from other sources. Now, with the growth of digital voices through social media and review websites, employees—past and present—are key players in the creation of employer brands. We have seen this particularly with employee reviews, which has been a major driver of change. People can post honest, anonymous reviews about their employers, describing the on-the-ground experience from an ‘insider’s perspective’. Faced with this, organisations must become more accountable for their behaviour—or risk being rejected by potential talent. Candidate-led recruitment In recent years, the approach to recruitment has shifted from ‘company-led’ to ‘candidate-led’, which is evident in the interview process alone. Employers are now reviewing their interview procedures, asking if they suit candidates, and asking recent hires what they would change about the experience. Company-led recruitment This is a top-down approach, where a position is advertised and candidates apply. The information shared about the advertised position is limited. The balance of power is with the hiring organisation. This approach is summed up by the interview question: “Now tell me, why should I hire you?” Candidate-led recruitment This flips the model by guiding potential candidates to make more informed decisions about whether to apply for a role. This approach encourages candidates to reflect on their ‘fit’ for the job by providing them with detailed information on the role and organisation prior to applying. Developing a strong employer brand There are eight key steps to developing a strong employer brand, which will give you a competitive advantage and set you apart in a crowded employment market. Step 1. Define your unique selling point Organisations invest resources in developing and promoting a unique selling point (USP) for their customers, clients and even potential employees. The USP is what makes an organisation distinct, setting it apart from its competitors. An employer’s USP will inform its employer brand, responding to candidates’ desires to join teams that share their priorities and values. This could be: “trusted advisor” “provider of excellent technical service” “friendly, responsive and flexible” “creative, cutting-edge and innovative” “award-winning agency” When defining or refining your employer brand, start by articulating your USP. Larger organisations may wish to engage specialist brand agencies, while SMEs can do this through insightful, exploratory conversations with their stakeholders. Ask your existing employees why they joined the organisation, for example, and what makes the business different to its competitors. You can also ask clients for testimonials which can be published online, thereby elevating your USP, not only to prospective clients, but also to future employees. Step 2. Communicate your purpose An organisation’s strategy is a core part of its employer brand and should be included in employer brand communications. Share strategy and purpose to attract the right people. For example, if the strategy is for growth, excellence and expertise, this needs to be represented in the offer to potential employees who are looking for new opportunities and a defined career trajectory. Step 3. Identify who you need to hire Define your recruitment needs. What are the skill sets you need to achieve your goals? Can they be introduced by training existing employees? Evidence of strong succession planning not only instils confidence in shareholders, but it also showcases your employer brand to current and prospective employees. Step 4. Understand your ideal candidates Find out as much as you can about your ideal candidates. What really motivates and excites them? What can you do to drive them to your organisation? The following can be used to source information on target and prospective candidates: LinkedIn Data can be captured on your target candidates’ education and qualifications, the professional bodies they are members of, and the LinkedIn groups they choose to join. Research Conduct research into new and existing workplace generations—what is the difference between Baby Boomers, Millennials and Generation Z? This will yield information on their motivators, drivers and values, which can inform your hiring strategy. Your team Talk to your existing high-performing employees to understand their interests, professional alignments, and networks. Your networks Use your own professional and social networks for further insights from outside your own organisation. Psychometric tools These can be used to track the personality traits and aptitudes of the best performers and can inform your thinking on ideal, as well as prospective, candidates. Step 5. Define your employer value proposition An organisation’s employer value proposition (EVP) is the distinct set of benefits (financial and otherwise) an employee receives in return for the skills, knowledge and experience they bring. The CIPD defines the EVP as “describ[ing] what an organisation stands for, requires and offers as an employer.” It provides greater consistency—to an organisation’s recruitment advertising, for example. Using the data gathering techniques described above at Step 4, you can develop a bespoke EVP for your ideal candidates. To create a successful EVP, consider the following: design around attributes that attract, engage and retain the talent you are seeking; be consistent with the strategic objectives of the organisation; identify what is unique to your organisation and distinct from your competitors’ offerings. The best EVPs involve synergies between the organisation’s corporate brand and its employer brand. Hubspot’s EVP, for example, states: “We believe the people we work with are our biggest perk. That’s why our people operations team works hard to create an amazing experience for candidates and employees, every step of the way.” As demonstrated by Hubspot’s EVP, it is important that current employees feel as much of a connection to the EVP as potential hires. Your current employees should feel aligned to your brand. Maintaining a strong employer brand demonstrates commitment to invest in talent, it builds trust, loyalty and credibility, and differentiates you from competitors. By making your EVP public and transparent, prospective employees are far more likely to trust what a company’s current employees say about it than what they read in recruitment advertising. To attract talent, employers must rely on employee engagement and advocacy from the ‘inside out.’ Employers cannot publicly offer what they do not privately provide. Step 6. Understand your employer brand As well as analysing feedback from current employees, a systematic way of evaluating your employer brand is to use a tool like the Employer Branding Measurement Dashboard, created by Elizabeth Lupfer of the Social Workplace (thesocialworkplace.com). It identifies key metrics for evaluating employer brand, such as: HR metrics, e.g. retention/attrition rates, number of applicants per position, cost per hire; awareness metrics, e.g. percentage of target audience who are aware of the organisation; differentiation metrics, e.g. employer brand value/effectiveness. Step 7. Enhance your employer brand There are some key areas of focus when enhancing your employer brand. It is particularly important when losing staff, or finding it hard to recruit new people, that each area is reviewed, and appropriate actions are taken. For example: Culture Consider a more ‘people-focused’ culture, e.g. offering flexible work arrangements. Presence in the marketplace Increase your visibility to ideal candidates: attend conferences, contribute to LinkedIn conversations, engage in expert positioning and thought leadership, enhance the organisation’s media presence. Candidates’ experience Improve response times to candidates, e.g. introduce a time limit to get back to candidates following an interview and stick to it. Step 8. Communicate your employer brand Communicating your EVP should be central to communicating your employer brand. This can be done through many channels, such as job advertisements, the organisation’s website, or its social media platforms, for example. The EVP should be obvious from the organisation’s website, which should clearly reflect the company’s culture. For example, if ‘technical excellence’ is one of the key aspects of the employer brand, show this with examples of technical projects and thought leadership. Ideally, the website should have a ‘Why work for us’ page, which is most effective when current employees share their positive experiences, highlighting the EVP. Clearly communicate the benefits you offer employees, for example: flexible working arrangements; training and development supports; annual and other leave schemes; pension schemes and employer contributions; health insurance group schemes and contributions. Conclusion For employers seeking to attract talented professionals, a clear employer brand, which is supported by the views of current employees, is a critical starting point. A strong employer brand gives you a competitive advantage, setting you apart in a competitive, candidate-led employment market. Dr Mary E. Collins is a Chartered Psychologist and Senior Executive Development Specialist at the RCSI Institute of Leadership, and author of Recruiting Talented People.

The negativity directed at numerous high-profile politicians in recent months calls into question their role in governing professional conduct, but who should guard the guards themselves? asks Dr Brian Keegan There is an old saying from classical wisdom that you should only speak good of the dead, and Boris Johnson probably knows the Latin translation. Of course, the former British Prime Minister is happily anything but dead, even though his political career might be. One of the more surprising aspects of Johnson’s political demise has been the extent to which the normally moderate commentariat turned, not just on his premiership, but also on the individual. Calm reputable voices like The Economist (“he lacked the moral fibre”) and the Financial Times (“a wanton disregard for rules and for the truth”) delivered scathing editorials castigating the man and his morals to an extent typically reserved for the tabloid response to sex offenders. Ordinarily, it is the dignity of the office that protects the incumbent from the worst slings and arrows. Once their office has been lost, however, they become fair game, as Donald Trump and Nicolas Sarkozy, both former presidents of their respective countries, know well, having shared the ignominy of rigorous investigations into their conduct while in office. You do not need to hold a particularly exalted position, as the former Irish Minister of State Robert Troy will attest, to be a casualty of public concern over your actions. There can also be public unease where former office holders have used their previous positions in a manner perceived to be abusive. EU ombudsman Emily O’Reilly has called this the “revolving door of influence.” Despite all the regulation and governance guiding so many aspects of life (and Chartered Accountants are particularly sensitised to this), we don’t seem to be able to ensure good behaviour among our elected representatives, public officials and expert advisors. So, who regulates the regulators? Chartered Accountants will be familiar with the activities of the Institute’s Professional Standards department, but perhaps less so of the extent to which the Institute itself is under the scrutiny of the Irish Auditing and Accounting Supervisory Authority (IAASA), the Financial Reporting Council (FRC) and so on. Nor might they be aware of organisations such as the Monitoring Group, an international consortium of the great and the good, scrutinising the development of the auditing and ethical standards to which accountants must adhere. All of these regulators and meta-regulators are creations of the political system. The star of government regulation can fall as well as rise. The FRC is currently being reconstituted as the Audit, Reporting and Governance Authority in the UK. In Ireland, the Corporate Enforcement Authority has replaced the Office of the Director of Corporate Enforcement. In both instances, these authorities are granted additional powers and autonomy at the behest of politicians. There is also the sin of political omission. Where is the Northern Ireland Assembly to ensure that devolved regulation is appropriate to the needs of Northern Ireland? This is why there should be no sympathy for any politician caught in breach of standards or regulatory compliance. They are directly responsible for the regulatory environment in which Chartered Accountants and other financial professionals earn their living. It is intolerable that their conduct be in breach of the kind of standards they require us to observe. Another Latin tag for this, with which Boris Johnson may also be familiar, is “Quis Custodiet Ipsos Custodes?” — “Who Guards the Guards Themselves?” It cannot be left to journalists from the Financial Times, Handelsblatt, or The Economist to do the guarding. All of the negative attention garnered by politicians over the summer might not change the future behaviour of elected representatives holding a duty of care over professional conduct. Dr Brian Keegan is Director of Advocacy and Voice at Chartered Accountants Ireland

As the dust settles on the Government’s recent Budget, Norah Collender and Brian Brennan consider the tax measures announced for businesses in Ireland Although the cost of living crisis dominated Budget 2023, announced by Finance Minister Paschal Donohoe and Public Expenditure Minister Michael McGrath on 27 September, it also heralded some interesting tax measures for business. The finer details of these measures—along with possible additional business tax measures—will be set out in the Finance Bill, due to be published on 20 October. For now, here is a rundown of what we know so far. R&D tax credit & KDB Budget 2023 outlines amendments to the payment provisions of the Research and Development (R&D) tax credit, aligning it with new international definitions of refundable tax credits. The changes include the removal of caps on the payable element of the credit and a new fixed three-year payment system. Under the new payment system, a company will have an option to request either payment of its R&D tax credit, or for it to be offset against other tax liabilities. The first €25,000 of the credit claim will be payable in the first year. This will provide a welcome cash-flow benefit for small companies, which make up two-thirds of claimants. The Knowledge Development Box (KDB) regime was due to expire at the end of this year, but Budget 2023 has extended the scheme for a further four years to accounting periods commencing before 1 January 2027. The extension is welcome, but companies need a long-term incentive to make investment decisions, so it would be preferable if the regime was to become a permanent fixture of the tax system. The KDB will be impacted by changes under the Organisation for Economic Co-operation and Development’s Pillar Two rules for a global minimum effective tax rate of 15 percent. The Government is taking initial steps to prepare for the OECD changes by increasing the effective tax rate of the regime from 6.25 percent to 10 percent (subject to a Commencement Order). In our view, more amendments will be required to ensure the KDB’s viability as an incentive in light of Pillar Two. It is also worth noting that, for companies not impacted by the proposed minimum effective tax rate of 15 percent, the increased rate of 10 percent will significantly reduce the benefit of the regime. Given the low numbers currently availing of the KDB, this change is unlikely to help with the uptake of the relief. Film relief/multimedia industry The film corporation tax credit was scheduled to cease on 31 December 2024. Recognising the long production cycle for audio-visual productions, however, Budget 2023 has extended the credit to 31 December 2028. Minister Donohoe has also signaled an intention to explore opportunities to encourage international players in new and innovative multimedia industries to locate to Ireland. Bank levy The bank levy, due to expire in 2022, is to be extended to the end of 2023. The levy was originally designed to produce a fixed annual yield of €150 million, but just €87 million will be raised in 2022 due to the exclusion of Ulster Bank and KBC Bank on their exit from the Irish market. The same yield is projected for 2023. The future of the levy is being assessed by the Department of Finance as part of the Retail Banking Review. Investment products and section 110 The Government will establish a working group to consider the taxation of funds, life assurance policies, and other investment products. The Commission on Taxation and Welfare suggested that such a review should consider how to simplify the tax treatment of investment products, and identify opportunities for horizontal equity and neutrality in the tax system when it comes to investment decisions. Currently, funds and life assurance policy providers are obliged to deduct 41 percent tax on both income and gains, which is higher than the rate of income tax and capital gains tax. It is hoped that the working group will focus on the scope and possible impact of reducing these rates. Minister Donohoe also announced plans to review the section 110 regime. The Commission on Taxation and Welfare’s report referenced the section 110 regime in the context of the role of institutional investors in the Irish property market. However, acknowledging that the regime applies to a broader range of assets than debt secured on Irish property, the report went on to recommend a wider review of the regime. Agri-business measures Budget 2023 outlined the extension of several agricultural reliefs set to expire at the end of this year. The proposed extensions are dependent on the outcome of negotiations at EU level on the Agricultural Block Exemption Regulation. Stamp duty reliefs for young, trained farmers and farm consolidations are to be extended to the end of 2025. Farm restructuring capital gains tax relief is also to be extended until the end of 2025. Stock relief enhancements for young, trained farmers and registered farm partnerships are being extended until the end of 2024. A new accelerated capital allowance scheme for the construction of slurry storage facilities is set to be introduced from 1 January 2023 and will run for three years.

The Irish economy needs a strong pipeline of accounting talent to support both FDI and domestic business, and the Leaving Cert Accounting syllabus is key to achieving this. Pat O’Neill and Brian Feighan explain why A growing number of Leaving Cert students are choosing to study accounting, but at a time of rising demand for accountancy skills in Ireland, more must be done to encourage an even greater number of second level students to pursue a career in the profession. Figures from CareersPortal.ie show that the number of second level students studying accounting for Senior Cycle in 2021/22 was the highest it had been in a decade, revealing a 70 percent rise at higher level since 2011. Although this trend is welcome, Pat O’Neill, President of Chartered Accountants Ireland, believes that more could, and should, be done to encourage second level pupils to study accounting for the Leaving Cert at a time of significant “capacity constraints” within the profession, and to better reflect the reality of what the profession entails in today’s world. “The pipeline of new talent entering the accountancy profession is not sufficient to fill the job opportunities available and Ireland is experiencing a real shortage of professionally qualified accountants,” O’Neill said. “Our economic pillars of large foreign direct investment and successful domestic businesses require appropriate levels of accounting talent. There is a real need to encourage more young people to pursue a career in the field to help address this shortage.” Critical shortage Accountants are on the Critical Skills Occupations List, compiled by the Department of Enterprise for professions experiencing a shortage of qualifications, experience or skills required for the proper functioning of the economy. The Northern Ireland Executive has also listed accountancy as an in-demand skill in Northern Ireland. “At a time when the Government is looking to address the vulnerability of tax revenues amid a slowdown in the global economy, it is perhaps surprising that there was not a greater focus in Budget 2023 on addressing some of the structural issues here at home, which are potentially undermining Ireland’s attractiveness as a continued location for foreign direct investment,” Pat O’Neill said. “Among these issues are the availability of suitable rental accommodation for workers and the availability of appropriately skilled staff to support such inward investment.” The key skill sets required to address the latter lie in accounting and finance, O’Neill said. “New multinational operations establishing a base here need appropriate in-house finance functions and capacity in professional services firms to support their transactional and regulatory compliance needs,” he said. “In addition, we have a significant and vibrant shared services sector in Ireland, which operates in many instances with a focus broader than pure transactional activity. Many of the organisations in the sector here operate EMEA or global centres of excellence, already employing large numbers and contributing significantly to the corporate tax base. Clearly, we have to look at growing the ‘funnel’ of entry into the accountancy profession.” Fit for purpose A “fundamentally important” part of addressing the shortage of accountancy skills in Ireland will be ensuring that the Leaving Cert Accounting syllabus is modernised for developments since the 1990s when it was first introduced, O’Neill said. “It is imperative that the syllabus is made fit for purpose in the 21st century and that it introduces young people to the breadth of the modern accountant’s role, engages them, and ignites interest in the subject as a career choice for school leavers. Otherwise, some students may be deterred from a career in accounting, and we won’t have the bench-strength to support businesses on this island,” he said. Chartered Accountants Ireland is a member of the Consultative Committee of Accountancy Bodies-Ireland (CCAB-I), which last year made a submission on this matter to the Department of Education, including the findings of its review of the current Leaving Certificate Accounting syllabus. “Subjects taken at Senior Cycle play a key role in influencing the third-level and career choices of students, so Senior Cycle Accounting offers a unique opportunity to engage, inspire and offer a career pathway, not just to the next generation of accountancy professionals, but to anyone with an interest in finance or enterprise,” said Brian Feighan, FCA, Chair of the CCAB-I Working Group for Promoting the Profession, and founder and CEO of LearnAltus, a provider of financial and executive education solutions. “Ireland needs a strong pipeline of talented students who are keen to progress their studies and careers in accountancy, through both apprenticeship routes and third-level pathways. It is essential that the Leaving Cert Accounting curriculum and examinations reflect the skills of the modern accountant and inspire the next generation of accountancy professionals, entrepreneurs and business leaders,” he said. Language of business Accountancy is the “language of business”, Feighan added, and financial literacy and financial competence are key drivers of economic prosperity across all levels of society in Ireland. CCAB–I views the second-level teaching of accounting skills at Senior Cycle as highly valuable and strategically important for the Irish economy and has conducted its review of the current Senior Cycle Accounting syllabus to include the higher and ordinary level examination papers and solutions from recent years, as published by the State Examinations Commission. “Working with the key stakeholders in education, our goal is to help deliver a new Senior Cycle accounting specification that reflects the skills of the modern accountant and inspires the next generation of accountancy professionals, entrepreneurs and business leaders,” said Feighan. “The current Leaving Cert Accounting syllabus was introduced 25 years ago, and we have seen very significant changes in the profession in the intervening period. Take, for example, the impact of technology on the profession. Advances in artificial intelligence, robotic process automation and data analytics have transformed the role of accountants, enabling them to focus on their role as key advisors on major business decisions.” Skills such as critical thinking, problem-solving and communication are now more central than ever to accountants’ work, Feighan added, as is guiding companies in measuring and reporting on sustainability. “In our submission to the Department of Education, we outline how the syllabus can be reinvigorated to give Senior Cycle Accounting students greater insight into these trends. We have seen encouraging work undertaken in this vein with the new Junior Cycle Business specification, and this more rounded approach will help attract even greater numbers towards the accountancy discipline from an early age,” he said. Pace of progress Notwithstanding the growing number of Leaving Cert students choosing to study accounting, O’Neill is nevertheless concerned about the pace of progress at secondary level. “The needs in Ireland and among Irish businesses for suitably qualified accountants exists in the here and now. There needs to be a real sense of urgency from all parties on bringing our accounting education syllabus into the 21st century,” he said. “We are very supportive of the desire of the Department of Education to do this, including recognition of the time required to redraft syllabus content and the appropriate training requirements necessary for our teachers to be in a position to deliver the new syllabus. The profession is willing to be involved in helping this to become a reality.” Chartered Accountants Ireland educates more than 7,000 students in an academic year and has more than 31,000 fully qualified members on this island and around the world. To support engagement with accounting in schools, in 2019 Chartered Accountants Ireland launched the Boot Camp programme for Transition Year and Senior Cycle students (for more, see page 27). Now in its third year, the programme is used by close to 4,500 students in all 26 counties. Collectively, these students have completed over 63,000 online lessons. “Accountancy has never been as accessible as a profession, and Chartered Accountants Ireland is working to continue to build the talent pipeline to support growth across all sectors of the economy,” said Pat O’Neill. In addition to the well-established Training Contract pathway familiar to many, since 2009 Chartered Accountants Ireland has offered a flexible route, working and training with one of the many companies in different sectors that train Chartered Accountants through their dedicated graduate programmes. “There are many options for the next generation to join the profession, whether directly out of school via Accounting Technicians Ireland or after university or college,” said O’Neill.

As Ulster Bank and KBC ramp up plans to exit the market, retail banking in Ireland has reached a critical juncture with far-reaching implications for the wider economy, writes Elaine O'Regan In mid-August, an article appeared in the Financial Times, heralding a “once in a generation” growth opportunity for Ireland’s banks. Irish lenders were primed for expansion, the article said, amid rising interest rates and the exit of both KBC and Ulster Bank from the market, leaving behind €30 billion in loan books and one million customers. While the exits may be good news for AIB, Bank of Ireland, and Permanent TSB—the three remaining full-service high street lenders in the Irish market—the contraction of the sector is of wider concern. “Industry stakeholders face fundamental questions about the sector’s sustainability and direction,” Brian Hayes, Chief Executive of the Banking and Payments Federation of Ireland, said. “As it stands, the profitability of the retail banking sector in Ireland is among the lowest in Europe, measured in terms of return on equity. Irish retail banks must hold back an estimated €2.5 billion in additional capital for mortgages, impacting the price of products and the share valuation of retail banks.” These banks need to be profitable to generate organic capital, which is lent back into the wider economy to support jobs, businesses, and economic activity, Hayes said, and “this will require new and diversified sources of income as well as further efficiencies in operational costs.” The biggest challenge facing Ireland’s retail banking system now is the need to continue running core functions while also meeting a diverse set of needs among competing stakeholders. “Financial regulators place a strong emphasis on strength and stability, while shareholders need to focus on sustainable profitability,” Hayes said. “These demands and expectations are not necessarily mutually exclusive. However, there is a need to acknowledge and seek a means to achieve balance between stakeholder demands.” Retail banking review As government officials prepare to present the draft report on the Retail Banking Review to Minister for Finance Paschal Donohoe, TD, in the weeks ahead, Hayes called for an informed and open conversation between all stakeholders and “meaningful and effective dialogue”. “We need a viable, safe, innovative, and purpose-led retail banking system, which serves its customers, the economy and society. A stable and viable retail banking sector is a fundamental prerequisite to a well-functioning modern economy and society,” he said. A new discussion paper on consumer protection, published at the start of the month by the Central Bank, noted that structural changes in retail banking, including the withdrawal of Ulster Bank and KBC and branch closures by other retail banks, was impacting “availability and choice” for both consumers and small businesses in Ireland. The discussion paper is the first stage of the Central Bank’s review of the Consumer Protection Code. The Irish financial system has “extensive scale and reach” at both retail and SME level, it noted, including 5.4 million current accounts, €101 billion in credit to households, €22 billion to SMEs, and €2.64 billion payment transactions in 2021. As KBC and Ulster bank continue to progress market withdrawal plans announced last year, some one million customers will need to move their current and deposit accounts to new providers. The Central Bank was, it said, “closely monitoring” this mass account migration process, including assessing ongoing implementation plans at an individual firm and sectoral level to ensure the protection of affected consumers. CCPC submission In its submission to the public consultation for the Retail Banking Review first announced in July 2021, the Competition and Consumer Protection Commission (CCPC) expressed its own concerns about the impending increase in concentration levels in retail banking in Ireland. “With KBC and Ulster Bank closing, small businesses here will have access to just two full-service banks, while for consumers, there will be just three,” CCPC member Brian McHugh said. “When you have just two or three players in any market, you would generally have competition concerns, because the evidence shows that customers in these situations tend to be worse off, not just in terms of price, but also quality and innovation.” While there had been some entry into the market at product level—in mortgages and business lending, for example— the CCPC noted that much of this was being provided by non-bank lenders, and that there had been no entry into the market by a full-service provider and no indications that such entry was likely in the near future. It was therefore vital that public policy and regulation facilitate entry into market, the CCPC said; that the mandate of the Central Bank of Ireland be amended to include competition objectives; and that its revised Consumer Protection Code promote fair competition in financial services. The CCPC also called for an evaluation of the operation of the Bank Switching Code as part of the Central Bank review of the Consumer Protection Code, and that the Government engage at an early stage with the proposal for a European Digital Identity Wallet to maximise consumer engagement and protection. “What we want to see, ultimately, is a more competitive landscape for banking in Ireland where we have new entry into the market. We are not specific about exactly what that might mean. We don’t know what the right solution is, but what we do want is to have lots of different providers coming into Ireland, offering consumers and businesses a variety of products,” McHugh said. “We have to ask why we are not seeing more European players moving into the Irish market and competing here as they do in lots of other markets. There is a need for Ireland to be at the forefront of any efforts to promote the European banking market and make it easier for other players in Europe to move into the market here under common EU rules. “I don’t know if we’ll ever see another full-service provider coming into the market here and opening a full branch network, but ultimately, we need to have competition for both pricing and innovation.” Jobs in banking Central to the continued viability of the retail banking sector at a time of “evolving consumer and regulatory demands”, would be its ability to attract the skills needed with competitive pay and career opportunities, Brian Hayes said. “Retail bank employees and potential recruits are subject, under both Irish legislation and administrative orders, to the most restrictive remuneration conditions in the EU. They are clear outliers when compared with graduates and employees in financial services and a range of other sectors. This places Ireland’s retail banks at a considerable and growing disadvantage,” he said. “The skills composition within banks is evolving rapidly, and the normalisation of pay and employment conditions is needed in the sector to attract the skills and employees necessary for the provision of services expected by Irish consumers.” The Financial Services Union (FSU), meanwhile, wants an “open transparent model of engagement on the future of banking” involving all relevant stakeholders. “Stakeholder banking is common across the EU. A new governance framework involving workers and consumer directors on the boards of banks would put the voices of customers, business, and staff, at the centre of decision-making,” FSU General Secretary John O’Connell said. “This is a big strategic focus now for the FSU—and it isn’t just a trade union matter, it is something the Financial Conduct Authority in the UK has identified in its own regulatory approach, identifying ‘worker directors’ as one option for providers. “It is about having a sustainable banking sector that doesn’t trample over people for profit and the race for digital. That’s not to say that change won’t, or shouldn’t, occur. It is about how this change will occur. We don’t want to see announcements of sudden branch closures in the future and all that entails for staff and customers.” Digital challengers According to the results of a survey published in May by the Department of Finance, just one percent of people in Ireland have their main current account with a digital bank. Carried out as part of the Retail Banking Review, the survey of 1,500 consumers found that 97 percent conducted their main current account banking activities through a traditional retail bank. Despite this, however, close to one-in-five said they were using a digital provider for banking or payments at least occasionally. The main appeal of fintech providers compared to traditional retail banks is that they offer instant money transfers, free banking, and allow customers to split bills as well as providing a user-friendly app, the survey found. Fifty-eight per cent of fintech customers strongly believe that the services offered by fintech providers are a very good substitute for the services offered by more traditional banks, it said. “Speed, convenience, and simplicity are at the core of positive customer response to digital banking, and we can’t ignore the new players joining the market,” said Billy O’Connell, Head of Accenture’s financial services business in Ireland. Revolut, the UK-headquartered digital bank, officially launched as a bank in Ireland earlier this year, operationalising its European specialised banking licence here, while N26 is licensed by the German Central Bank, operating in Ireland on a European Passport. Dutch neobank Bunq has, meanwhile, secured Central Bank authorisation to launch an Irish IBAN, and also recently acquired Capitalflow, a specialist digital lender to businesses in Ireland. “Early traction in this market has been based around highly frictionless, digital-first experiences for payments, money transfers and features like money management across demographics in Ireland, but new digital players continue to face challenges for providing complex lending and highly regulated products,” Billy O’Connell said. “New players are driving enhanced and innovative propositions—shaping customer expectations in the market and tapping into this need for new ideas, but they aren’t necessarily replacing banking services. Most people retain traditional bank accounts for core activities, like receiving salaries and taking out loans, so incumbents locally still retain a large market share despite disruption.” At the same time, O’Connell said, traditional retail banks are investing in new digital offerings and capabilities, releasing high-end apps, and improving online banking services, to compete with neobank challengers. According to the BPFI, Irish retail banks have collectively spent more than €3 billion in the last five years on technology and innovation projects to deliver new digital services for customers. Synch payments Synch Payments, a mobile money app joint venture involving AIB, Bank of Ireland and Permanent TSB secured CCPC approval earlier this year. “The ability to make instant peer-to peer-payments, without the need for complex payee addition journeys, is a key customer need, and it is envisaged that Synch Payments will address this need, with all Irish customers being ‘auto-enrolled’, so that they can make payments using just their phone number,” Accenture’s Billy O’Connell said. To continue to be competitive in the future, however—particularly among younger demographics—he added that traditional retail banks would need to commit further investment to more advanced services, such as end-to-end digital account opening, digital accounts aimed specifically at “juniors”, share dealing, and cryptocurrencies. “Decades from now, the banks that will be successful will be those that shape their businesses continuously to the needs of customers, employees, and other stakeholders, honing their abilities to identify opportunity and innovate efficiently,” O’Connell said.