Stephen Prendiville looks at how sustainability efforts to date are contributing to Ireland’s attractiveness to investors and how Ireland can continue to thrive in this area The EY European Investment Monitor, published in May 2022, has demonstrated how Ireland’s sustainability credentials are helping to bolster our position among Europe’s most attractive FDI destinations. Ireland has enshrined climate action law, holding itself to carbon budgets that include sectoral emissions ceilings and producing a climate action plan each year that sets a clear direction. The stability this offers provides positive momentum for sustainability and climate action, which is a factor in Ireland being an attractive destination for investment. It shows that sustainability can and must be a value-led proposition. Sustainability KPIs According to the EU European Investment Monitor, Ireland rated extremely well when it comes to a range of key sustainability performance measures. Eighty-eight percent of respondents said Ireland performs as well as, or better than, the European average for the presence of workforce and skills to facilitate sustainability projects. Eighty-six percent said the same for the availability of financing for sustainability projects and for regulation to support sustainable business practices. Ireland’s potential as a location to decarbonise the supply chain was rated as better or as good as the European average by 83 percent of respondents. The presence of an ecosystem of innovative cleantech and sustainability businesses (82%), local consumers’ concern for sustainability and climate change (81%), and the proportion of renewables in the electricity supply chain (79%) were also rated as at least as good or better than the European average. Government action Sustainability also figured strongly when respondents were asked to name priority areas for Government action to maintain Ireland’s FDI attractiveness. Investment in the decarbonisation of Ireland’s energy system and measures to accelerate progress towards a net-zero economy were highlighted as key areas of policy focus. Budget 2023 maintained a stable set of incentives, grants and other drivers for decarbonisation and positive change across the economy. The carbon tax was adjusted in line with prior commitments, and the overall result was stability in Budget 2023. These findings should come as no surprise. Sustainability issues have been ascending the corporate agenda for many years. In many key areas, the corporate and investment worlds appear to be ahead of governments when it comes to actions to tackle climate change and other environmental, social and governance (ESG) issues. At last year’s COP 26, it was highlighted that companies and governments must work collectively to advance climate action and decarbonisation at the scale demanded. While governments toil with difficult long term implications, businesses can move nimbly and take necessary action on much shorter timescales – which in turn will help governments take brave steps forward. Foreign direct investment From an FDI perspective, sustainability is likely to grow in importance in the coming years. FDI decision-makers will increasingly look at sustainability factors when choosing locations for new investments. And this will be driven by compelling business reasons. The first of those will be companies’ own requirements to decarbonise. New regulations like the Corporate Sustainability Reporting Directive (CSRD) will see companies being held to account for their performance in relation to decarbonisation and other sustainability targets. That will fundamentally change the equation when it comes to energy supply, for example. The availability of renewable energy will move from being a ‘nice to have’ to an absolute essential. Companies which have set 2030 as their target date for achieving net zero carbon will require electricity supplies generated exclusively from renewable sources well in advance of that date. While Ireland is viewed quite favourably at present for the proportion of renewables in its electricity supply chain, that position can change very quickly. Massive investments are required to make the grid capable of carrying more than 80 percent renewables by 2030, especially while there are barriers to renewable energy developments which need to be removed or mitigated. Rapid progress will be required in both of those areas if Ireland is to retain its attractiveness for inward investment. Ireland leading the global community While there is an opportunity for Ireland to be a significant part of the global climate action story, with the associated benefits to the Irish economy, there is no arbitrage opportunity when it comes to climate. Ireland is and can continue to lead the global community as we move forward on our sustainability journey together. We have some natural strengths, including a stable economy, vibrant tech and innovation ecosystems and an educated workforce. We are also a hub of global finance and technology companies accessing the European market. We can do more, and the European Business Attractiveness Index highlights that we are in a strong position to do so. Stephen Prendiville is Head of Sustainability at EY Ireland

Your time is a precious commodity and should be respected, particularly during busy seasons. Moira Dunne gives three tips on how best to utilise your time and maximise your productivity It is hard to be productive in today’s busy work environment, especially in the lead-up to the holidays. Whether you are working hybrid or fully remote, it is important to get the best return from the hours you work. Imagine finishing each workday with a sense of achievement, knowing that you have done everything on your list. For many people, that is the simplest definition of being productive: making a plan and then sticking to it. It helps us deliver important tasks, but it also contributes to our well-being. If you are not happy with your workday, do something about it. Start by understanding where your time goes each day. In most busy work environments, there are many requests and urgent issues, causing us to spend a lot of time in reactive mode, responding to others instead of making progress toward our own goals. To change to a more proactive way of working, you need to develop good habits. This helps you take control of your time and take charge of your workday. Here are three tips to boost your productivity in the few weeks before everyone takes a much-earned break. Tip 1: protect your time To protect your time, it is important to have a plan for your own work. Set out the key pieces of work you want to get done each week and the targets you absolutely must reach by Friday. Figure out what tasks will make you feel the most productive and accomplished by the end of the week and put them in motion. This plan gives you a focus for each day. You will be motivated to complete your tasks to achieve your target by the end of the week. Tip 2: say ‘when’, not ‘now’ Without a plan, it is hard to say no when someone makes a request, and people are often compelled to respond immediately. Your weekly plan will now help you quickly assess which work should take priority, particularly when it comes to new requests. For work that is a lower priority, ask the requester when they need it. They may say they need it straight away, but the question can prompt them to assess their own timescale and will communicate that you don’t drop work to respond to new requests. The best part of this response is that you are not saying no but instead negotiating a response time that suits your plan. Tip 3: make progress on the big things It can be hard to find time to work on bigger projects or goals, but this is our most important work. Sometimes we wait for a quiet week or a free block of time in our diary, but when those days do not come, the project gets pushed out. Start using your weekly plan to achieve your long-term goals. Include actions to get started on a project. Set a target to complete a goal. Bit by bit, task by task, make progress each week so that when the deadline arrives, you have the work done. Moira Dunne is Founder of beproductive.ie

The gap is closing on gender inequality in Ireland’s boardrooms, but organisations must do more to promote female leadership. Meliosa O’Caoimh explains how Published this month, the Balance for Better Business Review Group’s fifth report brought welcome news, revealing that targets of 30 percent for women on all public listed boards in Ireland had been exceeded for the first time, now standing at 32 percent. Figures for the percentage of women on the Boards of ISEQ 20 companies rose to 36 percent through voluntary action, up five percent on last year. Ireland also now exceeds the EU27 average for the proportion of women on leading company boards for the first time. For other listed companies, the percentage of women on Boards stands at 26 percent, exceeding the 22 percent target set for the end of 2022 and up 16 percentage points since 2018. It’s fantastic that, after just five years of the Balance for Better Business initiative, we are seeing such strides forward in female board representation. Progress is not happening at the same pace in other spheres, however—particularly with regard to C-suite (CEO, CFO and Chair) roles. Here, women are still significantly under-represented in many large companies. It is critical that we continue to address this gap, because—in addition to providing an important pipeline for board talent—it is imperative that we have gender balance at all senior decision-making levels within organisations. To help redress the balance, individual organisations must take their own steps to promote gender equality on Boards and C-suite. Here are some recommendations: Set Diversity and Inclusion (D&I) as a standing agenda item at Board level, using topics like the Gender Pay Gap, Balance for Better Business, ESG and other related issues to promote genuine discussion, and track progress; Integrate diversity into the business agenda at C-suite and Board level, to include action planning and KPIs for outcomes relating to employees, product innovation and development, supply chain integration and customer experience; Set targets for senior roles of influence with a focus on Board and C-suite; Build succession planning for key roles and ensure that, in 3:1 cover plans, there is a gender balance in available talent or a plan to achieve greater gender balance. Such succession planning should be based on individual roles and functions, and not approached as a blanket team approach; Complete a process review of all board appointment systems—including, for example, a board diversity policy, a nomination committee standard, and a commitment to balanced slates for selection consideration; Carry out a process review of all C-suite appointment systems, including mandated balanced slates, open advertising, and reviews of merit standards and role accountabilities; Commit to career path planning across specialist functions, particularly in Finance or P&L portfolios, to ensure gender balance in roles that are the future pipeline for CFO and CEO—from graduate, through to middle management, and on to senior management, as part of a longer-term strategy. Meliosa O’Caoimh is Chair of 30% Club Ireland

The Government has signed into legislation a new tax credit for the digital games sector. Ian Collins and Arek Rojek outline what this will mean for the gaming industry in Ireland On 21 November, the Irish Government, on the back of European Commission approval, officially signed into legislation a tax credit for the digital games sector. This offers a refundable corporation tax credit to digital games development companies for expenditure on the design, production and testing of a digital game. Originally announced in Budget 2022, the new tax credit represents a fantastic opportunity for Ireland to become a powerhouse in the global games development industry. It follows the recent introduction of several university courses geared towards video game development, and clearly sets Ireland’s ambition of becoming a hub for the digital gaming industry in a sector estimated to be worth up to €260 billion. This incentive will be available at a rate of 32 percent of eligible expenditure ranging from €100,000 to €25 million per project. It will also require the game to meet a cultural test based on the contribution its development is expected to make to the promotion and expression of Irish and European culture. These parameters are similar to those already applying to the Irish film tax credit. Video games in Ireland have a vibrant history, and a significant number of indigenous and multinational gaming companies already have operations in the country. When you combine this incentive with the Irish talent in the audio and visual arts, you have a recipe for success. Many other jurisdictions have introduced incentives in this sector, so the launch of the digital games tax credit in Ireland is also very timely. The regulations will now be signed by Revenue, allowing digital games development companies to apply for an interim certificate from the Department of Tourism, Culture, Arts, Gaeltacht, Sport and Media for a qualifying digital game. It is expected that certificate holders will then be able to apply for refunds under the scheme from 1 January 2023. The incentive provides a great opportunity for attracting, promoting and growing the digital games industry in Ireland. Only time will tell if the regime will be successful, however—and it should be noted that, while the tax credit is very welcome, some aspects could potentially slow the pace of growth in the digital games sector. Factors such as the proportion of development carried out in Ireland versus overseas, the rules governing the cultural test and the level of documentation required, will all no doubt play a pivotal role in determining how successful this regime will be. Guidance in this area will be very important to ensure the level of certainty needed to incentivise investors to choose Ireland as their place of business, as well as a healthy number of smaller companies looking to progress into the premium AAA games sector in cooperation with well-established game developers and publishers. Ian Collins is Partner/Principal, Business Tax Advisory (BTA) and Arek Rojek is Manager, Business Tax Advisory (BTA) at EY Ireland

No employer wants to let people go, but when redundancies are inevitable, a full understanding of your legal obligations is essential, writes Emma Richmond The news has been dominated recently by large-scale redundancies in the technology sector, with behemoth employers like Twitter, Stripe and Meta making headlines daily. Despite the depressing news, redundancy is not something any employer wants to face. However, in these uncertain times, it can be inevitable. Redundancy will leave your staff worried about what this means for their future career prospects so, as an employer, it is important to get the right legal advice when contemplating a redundancy programme. Employers must fully understand their legal obligations under Irish employment legislation, so we strongly advise consulting with a professional firm to ensure a fair, transparent, and legally compliant redundancy process. Before you reach out to a third-party, there are some key considerations to bear in mind. Redundancy A redundancy occurs when an employee's position no longer exists and the employee is not replaced. Within Irish employment legislation, there is provision for different scenarios which constitute a redundancy situation—for example, where an employer decides to carry on its operations with fewer employees. Collective redundancy A collective redundancy occurs where multiple redundancies are affected within a 30-day consecutive period. This is also dependent on the size of the workforce: Size of the workforce   Number of redundancies for a collective redundancy  21–49 5 or more   50–99 10 or more  100–299 10% or more  300 or more  30 or more   In a collective redundancy situation, there are additional employer obligations. These include: notifying the Minister of Enterprise Trade and Employment of the proposed collective redundancies 30 days prior to effecting any redundancies; and engaging in a consultation process with employee representatives. The minimum period of consultation is 30 days. No employee can be made redundant during this consultation period. Selection criteria in a collective redundancy Where a certain number of employees within a particular department (e.g. 10 employees within a department of 20) are being made redundant, the employer must apply objectively justifiable selection criteria. Examples of objectively justifiable selection criteria include adopting the approach of “last in, first out” or basing the selection criteria on an employee’s qualifications. Collective redundancy notice period In a collective redundancy situation, no employee can be made redundant during the consultation period. Once the consultation process has concluded and notice is issued, an employee who has at least two years’ service and is selected for redundancy must be given at least two weeks’ notice. Where an employee’s contractual notice is greater than two weeks, the employer must provide the employee with their contractual notice. While an employer may pay an employee in lieu of their notice period, the employee must be permitted to work during two weeks of their notice period. Statutory redundancy Employees with over two years’ service are entitled to a statutory redundancy payment which is calculated as two weeks' pay for every year of service (capped at a maximum of €600 per week) plus one additional week's pay. Employers may decide to pay their employees an ex gratia payment over the statutory requirements. It is good practice where employees are receiving an ex gratia payment that they be expected to sign a severance agreement in which they waive their right to take any future claims against their employer. Employees should obtain independent legal advice in advance of signing a severance agreement. Employers should get advice in drafting severance agreements to ensure that they are effective and enforceable. Redundancy entitlements and legal compliance Another key consideration is redundancy entitlements. Some of these include: entitlement to statutory redundancy; the lawfulness of the redundancies; timeframes of employment contracts; any transfer of undertakings in relation to the TUPE Regulations; and considerations regarding ex gratia payments. Employing the services of a professional for legal advice and consultation on relevant compliance requirements concerning redundance is advised here. Emma Richmond is Partner at Whitney Moore LLP Law Firm

The cost-of-living crisis seems bleak, but there are also opportunities for businesses to appropriately pivot their products and services to ensure they remain relevant to their core customers. Charlie Kerlin explains how The current cost-of-living crisis is having a profound impact on the UK economy. Consumers are already feeling the pinch, making a significant difference to how they spend their money. Although already impacting all sectors, this crisis will likely be felt most in retail, food and drink, hospitality and other sectors reliant on discretionary spend, in the months ahead. Faced with inflation and rising interest rates, household finances in the UK are being stretched. With GfK, the consumer data firm, reporting consumer confidence at a record low in September, fears of a recession have jump-started a ‘cut back economy’. The Cut Back Economy report, published jointly by Grant Thornton and Retail Economics in July, explored the effects of the current economic climate on discretionary consumer spending in the UK. The report estimated that the cost-of-living crisis would slash discretionary spend across the UK economy by about £24.9 billion per annum—and Northern Ireland is expected to be hit harder than other parts of the UK—due, in part, to the fact that energy prices are regulated differently in the region. The least affluent households across the UK are now spending about two-thirds of their entire income on necessities like electricity and the cost of heating oil or gas, and transport. Eighty-six percent of the households surveyed said they planned to cut back, but some variances exist. More than a third (36 percent) of those surveyed could be considered ‘financially stressed’. Other significant cohorts identified included ‘squeezed spenders’ (25 percent) and the ‘comfortably cautious’ (25 percent), each planning to cut back spending. Just 14 percent of respondents said they were determined to be ‘financially immune’, illustrating the vast impact of the cutback economy. So, how do we speak to the 86 percent, led by the younger generations who are leading the cutback? Some people will have to cut back by necessity. However, a significant proportion of the population, while more cost-conscious, will still have some level of discretionary spend. The data shows where and how habits are changing. Consumers are increasingly mobile, seeking to move brands or retailers. There is a shift towards discount supermarkets and own labels, and demand for foodstuffs, such as dry pasta and grain, is increasing exponentially. In order to allow businesses to pivot, data will be essential. By gathering and analysing relevant data and market trends, companies can better understand the behaviour and intentions of their core customers. What are they willing to compromise on to spend less? Is it lower quality, a lesser experience, or are they prepared to sacrifice convenience? For example, 35 percent of all households, regardless of how conservative they intend to be when spending, said they would spend less on media subscriptions. Thirty-one percent would spend less on holidays and beauty, showing luxuries are on the chopping block. Based on the economic modelling in the report, the impact of the cost-of-living crisis will see the retail, leisure and consumer industries in the UK lose £24.9 billion in discretionary spend in the year to April 2023. Companies must refocus on the core customers that retain spending power and ensure their product is appropriate to that market segment, while also offering value for money and ways to mitigate the challenges their customers face. This will help them to generate goodwill and loyalty as people pinch their pennies. We are seeing businesses work their contingency plans, seeking ways to become more efficient, optimise production and reduce waste. Financial resilience will be a crucial area of focus for the foreseeable future. It will be a challenge, undoubtedly, but understanding consumers and their behaviour is key to navigating the period ahead. Charlie Kerlin is Director of the Corporate Finance team at Grant Thornton Northern Ireland 

Networking can be stressful, especially when you want to leave a conversation without causing offense. Jean Evans outlines the dos and don’ts of a graceful exit We’ve all been there, stuck in a conversation at a networking event and not sure how to extract ourselves politely and leave feeling guilt-free. This is a skill that takes courage and, when done correctly, one that can demonstrate control, respect, and leadership, creating a positive first impression and leaving you with your reputation intact. No one wants to be ditched at a professional engagement by someone who looks like they’re eager to get away, just as no one wants to make another person feel unwanted or uncomfortable. So, plan ahead before you head out the door to network with your colleagues, other professionals or business contacts—and think about how each interaction might take shape. How long should a conversation last? How long a conversation should last really depends on your networking goals, whether you’re an introvert or an extrovert, and if you already know people at the event. However, the recommendation is five to ten minutes per conversation, before moving on. When to break out of the conversation To leave a conversation, you should wait until you can sense there is about to be a lull and then get in there with the opportunity to close off before the lull hits. Why? Because when the lull occurs, the conversation becomes awkward. If you catch it before the lull happens, then you’ll have the chance to leave the person on a positive note and with a first positive impression of you. Here are a few ideas for how you might approach finishing a conversation at a networking event. 1. Request a business card The act of getting and receiving a business card often signals that a conversation is coming to a natural close. You can finish off with: “It was great to speak with you, and thanks for your business card. I’ll connect with you on LinkedIn. I hope to see you at another one of these events soon.” 2. Organise a follow up If a 10-minute conversation isn’t long enough, then get out your calendar and schedule the follow-up right there. This shows that you are serious and committed to the conversation. You might say: “I’d love to get your business card to continue our conversation. Can we arrange a call next week? When might suit, and we can get something in the diary now?” 3. Make an introduction Ask your conversation partner who they’d like to meet and see if you can make a beneficial introduction for them. You’re adding value and allowing both parties to move on gracefully. You can say: “I’d love to introduce you to [name] – I think they would be a great connection for you.” 4.Top up your drink Tell the person with whom you are speaking that you’re going to get a drink or some food. Offer them something and tell them it was great to meet them before moving on. Leave them feeling good. 5. Do them a favour Make your exit sound like you are doing something to benefit the person you’re talking to and less about them thinking you are trying to get away. You can say: “I don’t want to take up all your time – I know we’re all here to network. It was great chatting with you and getting to know you a bit better.” While there is no doubt that closing conversations at networking events can be daunting, anyone can master this essential skill with enough practice. Jean Evans is a Networking Architect and Founder at NetworkMe

Compliance with data protection legislation is the responsibility of the board of directors of every organisation and must be prioritised in the boardroom. David O’Sullivan explains why Data protection starts and ends in the board room. Every board member should have a good understanding of data protection and how it affects their business, and every board- and sub-committee must be equally aware of the organisation’s existing compliance status and the operation of its data protection framework. Data protection fines to board members and directors the Data Protection Act 2018 (GDPR), directors may be liable for a fine of up to €50,000 and/or five years imprisonment if they are found to have allowed the organisation to commit an offence through consent, connivance, or negligence.    In the UK, the Information Commissioner’s Office has levied personal monetary penalties against company directors, demonstrating an appetite to keep senior management and company directors accountable for their actions. And while at the time of writing we are unaware of any such actions against company directors in Ireland, penalties here will inevitably follow. What questions should board members be asking? The data protection world is changing rapidly with the onset of fines, decisions and guidance from regulators, alongside evolving technology and new legislation. As such, it is crucial that organisations remain vigilant to change and proactively manage it, avoiding unnecessary risks.   There are some key data protection questions board members should ask: How are we staying abreast of changes? What are our current top risks? What are our industry peers doing? Are we making the most of this challenge/opportunity? Do we have the right level of expertise to deal with this? Do we need a full-time resource? Can we outsource the Data Protection Officer (DPO) role? What are the upcoming actions in the data protection framework? How involved should the board be in data protection? For an organisation to have data protection embedded, the board should oversee change and the direction of data protection. The below demonstrates examples of what high, medium and low levels of board involvement may look like in an organisation: High – a member of the board is made responsible for data protection. They regularly meet with the DPO or data protection manager for updates and report to the rest of the board on compliance at each meeting. The DPO presents to the board regularly, and the board actively asks for updates on risk actions. Medium – the board receives bi-annual reports from the DPO outlining compliance efforts and key risks and receive updates on risk actions. Low – an update report is provided to the board every quarter, with one annual report is presented by the DPO or another person responsible for data protection compliance.  How to know if your data protection framework is effective Every organisation has a data protection framework, some more formalised than others. Your framework must operate effectively, ensuring you will achieve your desired outcomes.   You will be able to know that your framework is effective if: staff receive regular training and awareness updates; you are informed of data protection risks; privacy has been built into processes and procedures; and frequent updates are given to the board on compliance status and steps to reduce any compliance gaps. How to use data privacy to your advantage There are several reasons to keep privacy in your strategic plans, ranging from compliance and fine mitigation to risk management and consumer trust. Consumer sentiment is changing, and people are making choices based on how their personal data is protected. No stronger evidence is needed than the actions of the world’s largest consumer technology companies’ efforts to increase privacy and security—Apple giving more tracking control to users, for example. To use privacy to create strategic and competitive advantage, the direction needs to come from board level and be embedded into the company culture. The most effective programmes are in organisations with clear ownership of data protection at the top level. David O’Sullivan is Consulting Manager with Mazars

A new survey has shown that most professionals are happy at their work, but remuneration is still the predominant reason people move on. Paul McClatchie delves into the results. The rising cost of living, combined with the talent shortage, is a sure-fire recipe for pay inflation.  However, a new survey by recruitment company Engage People shows mixed fortunes in the financial and legal sectors regarding remuneration over the past year.  Despite this, however, most professionals surveyed appear to be happy at their work.  While 63 percent expect a salary increase over the next 12 months, almost a quarter (23%) of the 795 people questioned did not get a pay increase in the past year. Eleven percent was the average increase in salary for those who did. Sixty-one percent saw their hours impacted by COVID-19, and 47 percent took a COVID-related pay cut. Of those, the average drop in pay was 12 percent. Anecdotally, the flexibility to work from home has saved employees money and contributed to a better work/life balance. So, a short-term impact on compensation hasn’t upset too many in the professions. On top of base salary, many professionals will have a car allowance and fuel cards. Most get an employers’ pension contribution, meaning total remuneration is generally higher than basic pay. In terms of bonuses, 75 percent of respondents in accountancy, banking, financial services and legal roles say they received a bonus last year, and 67 percent of those were satisfied with the level of bonus. For junior positions, 26 percent of base salary was the average bonus, where earnings were predominantly under €35,000.  Ten to fifteen percent was the mean annual bonus in the accounting area, with higher bonuses in banking relationship manager and sales roles. Although 82 percent of respondents claim to have worked some form of weekly overtime for up to three hours a week, just 41 percent received paid overtime. Again, overtime was more common in junior-level roles, up to a €40,000 base salary. Fifty-five percent anticipate their company’s staff numbers will grow over the next 12 months. The lure of a new role Despite the possible pay cuts and overtime, 84 percent of the professionals responding confirmed they are happy with their current work-life balance. However, the grass is always greener. Fifty-eight percent of professionals in financial and legal roles are satisfied or very satisfied in their current role, but almost two-thirds (62%)  admit they would leave their role if the right opportunity came up.  Pay remains the top motivation to move, and a 10 percent salary increase was the average expected by those surveyed to leave their job for a new role. However, 58 percent also said that they would turn down an offer if their current employer were to make a suitable counteroffer. The survey also identified career progression opportunities, the people in the company, and the company culture as reasons people will move to a new role. In terms of desirable benefits employers can offer, the top answers concerned flexible working, including both hybrid working and flexi-time. The offer of career breaks and a company car or a car loan were the next most sought-after perks. Paul McClatchie is the Founder and CEO of Engage People.

From tribe-based banking to embedded finance, Nick Root reveals what you can expect to see in the year ahead in fintech The financial technology sector is rapidly evolving, with traditional methods of banking now being replaced with digital solutions to make things faster, easier, and more streamlined for both businesses and consumers.   Here are the top trends in fintech in 2023. Virtual bank cards  Hailed as the future of financial spending, virtual bank cards are at the forefront of a revolution in business expense management. Since 2017, searches for the digital bank Revolut have increased by 143 percent, receiving an average of 1.3 million monthly searches globally.   Looking at Google Trends, we can also see that the term ‘virtual card’ has increased by 216 percent in the last five years and is currently at its peak. But how are they being used by businesses?  Perhaps the biggest reason virtual cards are increasing in popularity is that they offer more robust security measures, helping eliminate misuse by hackers and fraudsters.  They also reinvent the way companies handle employee business expenses. Every employee has a unique card, which means anyone can easily see who is spending what. Funds can also be assigned to team budgets, and purchases can be limited so that nobody spends more than what’s allocated. Embedded finance  The success of embedded finance will be predominantly down to distribution, trust, and improved user experience.   Banking as a service defines an ecosystem in which licensed financial institutions offer non-banking companies access to their services, typically through APIs. It enables clients to embed financial services into their products or build new financial services from scratch. The emergence of API-led banking services means distribution is no longer an issue. That layer of friction has now been removed, with any digital company able to offer a financial service without the headache and complexity that providing financial services used to bring.   Buy-now, pay-later 2.0  While buy-now, pay-later (BNPL) has raised concern recently, the online trend allowing customers to split their payments into interest-free instalments continues to surge.   Traditionally, BNPL services were used to split payments for high-value items, but they soon became associated with online fast fashion brands, targeting Gen Z and Millennial shoppers. In recent weeks, BNPL was further criticised after Swedish fintech company Klarna partnered with the fast-food delivery app, Deliveroo, allowing customers to ‘eat now, pay later.’  And although many mainstream banks are steering towards virtual cards, in January 2022, Klarna launched its first physical credit card, allowing customers to pay in-store and online.   In 2023, although it is expected to expand further, in Ireland, BNPL providers must go through the Central Bank to be approved. BNPL will also be regulated in the UK, as the government plans to enact legislation requiring lenders to carry out affordability checks before approving loans. The financial promotion rules for BNPL are also set to change to ensure advertisements are explicit and do not mislead consumers.   Contactless wearables  The Internet of Things is making waves in the fintech sector, allowing consumers to pay for goods and services faster than ever with wearable technology.  Alongside smartphones, bracelets and smartwatches are now used to make payments instead of bank cards.  The Apple Watch is one wearable that took the world by storm, showcasing an upward trend in 2022. Smart rings are also on the rise, with searches for the revolutionary wearable increasing by 180 percent globally.   Regtech  A new buzzword you may have heard in 2022 is Regtech – but what is it, and why does it matter?   The rise in digital products means there is an increased risk of data breaches, cyber hacks, and money laundering – but that’s where Regtech comes in. Regtech is a group of organisations that solve challenges arising from a technology-driven automated economy.   The Regtech industry is expected to disrupt the regulatory landscape by providing advanced tech solutions to compliance issues that arise in the fintech sector.  Tribe-based banking  The term ‘digital tribe’ has become popular in recent years, used to describe online communities that share a common interest, and are usually connected through social media or other online platforms.   In the past, people from diverse communities have been uncomfortable with legacy banks because they have not been represented, don’t feel empathised with, and aren’t open to communication.  Banks need to be more authentic and receptive to communication in this new era. People from these communities will soon be looking for a bank that gives them a sense of representation and openness. Nick Root is the CEO of Intergiro.

With cyber threat levels on the rise and their complexities growing, it is time to bring cybersecurity into the boardroom, says Puneet Kukreja According to the EY Ireland Global Information Security Survey 2021, 90 percent of Irish cybersecurity leaders reported an increase in disruptive cyberattacks over the previous 12 months. This issue goes beyond the chief technological officer’s remit and should be a company-wide concern, including the organistion’s board. The board plays an important role in overseeing and supporting how an organisation enhances its cybersecurity controls and practices in a world where threat levels are on the rise. Below are seven critical areas that boards need to focus on to better align themselves with the organisation’s cyber strategy and ensure that the organisation’s cybersecurity needle is moving in the right direction. 1. Understand the business Boards and their sub-committees are now required to undertake key oversight activities related to cyber risks across critical business processes and systems. For this, they should be aware of the budget allocated to cybersecurity programmes and understand whether the organisation’s cybersecurity function is adequately funded and resourced. The board should also be aware of the key responsibilities for security and data privacy across the enterprise. They need to be aware of the potential exposure of known blind spots. 2. Acquire knowledge of technology It is important for the board to gauge if it has the required knowledge and expertise in technology. It is imperative for the board to understand how the rapidly evolving ecosystems of cloud, cyber and data protection, internet of things and privacy overlap with its role in corporate governance and risk management. 3. Understand the cyber environment The board needs to have a clear knowledge of how a cyber threat can be responded to in a rapid manner. It is critical for the board to have a view of the full range of cyber risks facing the organisation and the potential to improve its existing cybersecurity control and practices. It needs to ask if management can implement the required risk management protocols to reduce the mean time to exposure and if the organisation has an effective incident response and recovery function in place. It is also important for boards to know if the systems targeted in a cyber event are managed internally, externally or sourced from the cloud. 4. Facilitate response readiness Boards must help document a cyber threat management framework. This framework should be regularly tested against the ‘cyber kill chain’ approach, a phase-based model used to describe the stages of a cyberattack which helps construct response plans for organisations. 5. Have exposure to cyber wargames Has the board and its sub-committees been exposed to a cyber incident response training exercise, or received training on how will the organisation respond if an attack occurs? One key action that boards can take is to bring cybersecurity-related skills and experience into the boardroom through the appointment of non-executive directors with previous experience in technology-related roles. 6. Keep third-party agreements ready Boards need to ensure that cyber incident response agreements are in place with third-party suppliers of technology and subject matter experts who can be mobilised in the event of a cyberattack. Boards also need to understand how the cyber risk exposures of all stakeholders are assessed and determined. 7. Be adept at media management If systems are compromised and sensitive data stolen, it could potentially impact an organisation’s reputation. The board should understand how the organisation will respond to the media and stakeholders following a cyberattack or breach. Take a holistic approach With remote and hybrid work being the new normal, continuous assessments and improvement of cybersecurity controls and practices across the organisation should be the focus of the board. For this, boards can mandate organisation-wide continuous training and education around cyber threats. It may also be useful to accompany this with a cyber awareness programme. An eye on internal control framework and cybersecurity monitoring procedures is needed, as well. The role of the board is assuming greater importance as cybersecurity risks and threats grow. Boards must now play a more constructive role in advising on post-incident response plans and in managing them from a business continuity perspective. Cybersecurity activity should not be seen as purely defensive. A company’s ability to adjust and strengthen its cyber resilience will position it for a more secure future. Puneet Kukreja is Cyber Leader in EY Ireland

Attracting and retaining talent is a challenge for most companies. Sean McLoughney outlines how regular performance management conversations can help engage and motivate high performers When someone leaves a company, there are greater costs than lost revenue and business opportunities. It costs time to recruit, interview and onboard someone. It can cost team morale, too, when a highly valued team member leaves. So, it is no surprise that managers are looking at ways to improve their staff retention strategy. However, one option that is often overlooked is performance management—in particular, the performance conversation. Below are three ways that performance conversations can be used as part of your strategy for engaging high performers. 1. Regular conversation The traditional annual reviews will soon be obsolete as they have little or no impact on people’s performance levels. Sitting down at the end of the year to discuss someone’s performance is a complete waste of time, because often it is too late to influence results. The only topic that people want to talk about at these annual meetings is their pay rise and bonus. Regular performance conversations throughout the year can, however, provide a great platform to communicate expectation levels and clarify business priorities. They can also help to foster the right environment for success, because talented people need to know that their input has meaning and makes a difference. Link their successes to key business and team outcomes and comment on their individual contributions. Another key component of these regular conversations is discussion about the areas each team member will focus on in the period ahead. Keeping the conversation future-focused will help you to understand what they intend to do and how they will optimise their time and resources. Remember, while you can’t change past results, you can influence future performances. Build regular performance conversations into your ways of working. 2. Align individual goals with business outcomes High performers want to ensure that their efforts add value and have an impact on the overall business results. The role of a performance-focused manager is to translate the business strategy at its highest level into what it means for each person. Discussing the business plan with your team will bring context to their work. It allows them to establish their own key goals, aligned effectively with wider business objectives. Being involved in defining their own goals increases personal accountability by fostering a sense of ownership, which will also increase engagement. Set up a team meeting to discuss the business plan prior to your next performance conversation. Start by outlining the plan at its highest level and the subsequent key priorities for your team. This will give everyone a better understanding of the significance of their work, as well as a sense of purpose. Next, ask the team what they believe needs to happen to achieve these expected outcomes. Gather all their ideas and connect them to the business goals. Then prioritise this list so that everyone’s focus and time is spent on tasks that generate a maximum return on their efforts. Finally, turn these ideas into achievable goals that bring clarity and engagement. You can discuss these goals with each person during their performance review meetings and update them, when necessary, throughout the year. This will ensure everyone is always working on the most important tasks. 3. Skills mastery and career progression The third way performance reviews can be used to improve staff retention is to have discussions about their skills mastery and career progression plans. Talented people are more likely to stay with your organisation if they genuinely believe that they are being continually developed and have access to opportunities to progress their careers. As part of your talent support role, you should ensure that everyone on your team has a skills mastery plan. A skills mastery plan provides people with a framework to enhance their skills, knowledge, and expertise. This helps them build a knowledge of skills for their current role requirements, while also preparing them for future promotional opportunities. The skills knowledge plan is not a static document. It must be reviewed and updated on an ongoing basis. During performance conversations, outline how your team members’ skills knowledge plans are aligned with the agreed business goals, and how they are likely to impact their career paths. Make sure to affirm how their learning can support them in achieving their goals and career aspirations. This is a great opportunity to embed a culture of continuous learning and improvement. Performance conversations, when used correctly and regularly, ensure that your company has the best possible chance of delivering a sustainable level of high performance now and in the future. It is an important component in attracting and retaining talented people. Crucially, all these steps are about much more than just discussing goals. They create opportunities for talented people to understand why they are important, how their efforts impact business plans, and how you plan to support their personal development and career progression. Seán McLoughney is the founder of LearningCurve and author of Time Management, Meaningful Performance Reviews and Slave to a Job, Master of your Career, all published by Chartered Accountants Ireland

With the Protected Disclosures (Amendment) Act 2022 now signed into law, companies must ensure they are up to speed with new requirements, writes Ita Gibney As we emerge from the pandemic, we have entered a phase of overwhelming change. We are heading into inflationary times, the Ukrainian–Russian war looks set to be prolonged, a recession is imminent, and a new world of work is emerging, as companies consider their cost base and margin pressure—whether it’s office space, employee numbers or energy costs. Such adversity creates increased risk and additional scope for negative news, making it imperative for companies to manage their communications with even greater skill and care. Accountants, as close advisors, are often called upon for advice in this area, which is not always their field of expertise. Liquidators and receivers, in particular, will be under pressure as they work through the fall-out of corporate challenges in the period ahead. Against this backdrop, businesses are also trying to be socially conscious and to run responsible, sustainable ventures. Purpose is now seen as being every bit as important as profit. Stakeholder capitalism is part of the valuation equation. Good governance, ethical behaviour and sustainability are now on a par with risk management and legal compliance. And, recent whistleblowing cases concerning both Uber and Twitter demonstrate just how fast reputations can sink when a corporate entity finds itself in the glare of negative publicity. Updates to Ireland’s whistleblower regime In Ireland, the Protected Disclosures (Amendment) Act 2022 has brought significant change to our whistleblower regime, including greater risks for companies, especially those engaged in unethical practices or breaches of law. The updates build on the protections offered in 2014 under the Protected Disclosures Act. Now, a wider scope of categories of worker will be protected, including volunteers, board members, shareholders, and job applicants. Further, the definition of penalisation has been expanded to cover more covert acts, including negative performance appraisals or withholding promotions. Most notably, the amendments put the burden of proof firmly with the employer. For corporate entities of 50 employees or more, the Act requires that they establish, maintain and operate internal reporting channels and procedures for the making of protected disclosures. The importance of having policies and processes for protected disclosures provides an avenue for the whistleblower to go through prior to reaching out to external sources. Entities will need to be aware of, and know how to, manage their risks prior to a disclosure. Prevention is better than a cure Under the new legislation, there is now a greater risk of a whistleblower going public. Whistleblower procedures, then, must be part of wider corporate reputation strategies, recognising that crisis prevention is the key to corporate health. There is a renewed drive towards unionisation of workers, and a backlash against the gig economy and poor workplace cultures, especially for new market entrants. Work cultures, if found to be negative, are quickly trending on social media, affecting recruitment as well as reputation. Companies need to be quick, consistent and authentic when it comes to protecting their brand against public scrutiny. All the experts in the world will advise that it is wiser to prevent a crisis than to handle one. A good CEO will manage the risks hands-on, test the crisis communication plans, have good independent counsel to plan for any potential bad that may arise in the future. Companies will forge great reputations, not just because they have great products and services, but also because they take full account, in advance, of the public impact of their corporate footprint. CEOs and boards must take heed—never has corporate reputation and maintaining the trust of stakeholders been such a critical factor in preserving business value. Ita Gibney is Chair of Gibney Communications

Active listening can be a powerful tool for effective communication and connecting with colleagues. Ed Garvey-Long offers tips on how to get it right It might surprise you to hear that there are different types of listening. However, I'm sure we all know the feeling of talking with someone and noticing that the other person's attention is elsewhere, distracted by something else. This can make us feel like the person we are talking to is undervaluing what we are saying, even though they may well be able to recall accurately what was said during the conversation. This is known as 'passive listening.' Its opposite—active listening—is a much more useful tool, particularly in the workplace and when connecting with colleagues. The term 'active listening' was coined in the 1950s by American psychologists Carl Rogers and Richard Farson. The central idea of active listening is to be an equal participant in conversations. This allows the listener to take note of body language as well as words and will result in a more nuanced discussion. Employing active listening will not only help your colleagues feel they have genuinely been heard but can also help build a foundation of trust within teams. Furthermore, this is a skill that anyone can learn. Below are some tips to help you become an active listener: Slow down When another person else is talking, we might rush to the end of the conversation, guessing what they are trying to say and getting our brains to start rehearsing what is best to say in response. In doing so, however, our attention shifts, and we risk missing important details. Don't rush ahead! Instead, slow down and really consider what is being said to you. Once the other person has finished speaking, taking a second before speaking is OK; maybe even ask a follow-up question about what they have just said to demonstrate that you have been listening and understood what has been said. Notice what's not being said We give off more signals about our thoughts and feelings than just by using our words. Our body language can often give subtle clues about the speaker's situation. For example, a stressed colleague might have very tense body language, sitting hunched on their chair. Stress can also sometimes be heard in someone's voice, making them sound strained or even quieter than usual. If you notice these behavioural changes in someone you are conversing with, don't interrupt them and draw attention to it. By doing so, you run the risk of making them feel uncomfortable. Instead, wait for an appropriate time to ask a question like 'are you doing all right?' This can reassure someone that they are being noticed and might encourage them to open up more about their situation. Empathy is king Everyone has difficulties in their lives from time to time, whether it be work stress, family issues or money worries, etc. When listening to someone, consider their perspective as much as possible. They might have been nervous about having this conversation with you or are finding the topic hard to talk about. Recall how you've felt in the past in similar situations and behave as you wish others had behaved towards you then. Consider the context Active listening is a great skill to practice and can really help colleagues feel heard and help you develop your own communication skills. However, it is essential to acknowledge that it can be quite tiring to be constantly in active listening mode. Instead, consider saving your active listening skills for important meetings, such as probation reviews or when colleagues ask to speak to you in private. Active listening can be a powerful tool, but it's wasted if it's used on idle chitchat in the office kitchen! Ed Garvey-Long is a poet and founder of Ed Garvey-Long Coaching

As organisations across Ireland prepare to publish their reports, Deirdre Malone outlines some practical aspects of the Gender Pay Gap Information Act. Among the key questions for employers about Gender Pay Gap reporting, one of the most important is who to include. All employees must be included, but this is not as straightforward as it appears. The definition of an employee in Irish employment law is well understood, but for Gender Pay Gap reporting, the statutory definition is taken from the Employment Equality Acts and includes individual contractors who are engaged personally to provide services. This definition has the potential to make things very complicated for employers. In most cases, employers have gone to some lengths to ensure that these individuals are not deemed employees. They do not have HR records for them, and they do not know how much the contractors are paying themselves for their work for the organisation, nor have they any idea of their leave and bonus arrangements. Including this cohort of workers in the Gender Pay Gap report will place many employers in a difficult position. Furthermore, this data gap may force some employers to exclude contractors from their Gender Pay Gap report. The Guidance Note that accompanies the Gender Pay Gap Information Act (the Act) advises employers to consult Workplace Relations Commission (WRC) case law for advice, but this is not as comprehensive as it could be. Instead, a practical and common-sense approach is required. Non-binary and transgender employees Very simply, everyone identifying as female must be included as female in the report, and the same applies to males. There is no definition of male or female in the Act, and it is up to individual employees to self-identify their gender. Organisations must remember that HR records may not be in accordance with individuals’ self-identification. Where there are non-binary individuals who do not identify as either gender in the workforce, they are not included in the Gender Pay Gap calculations but should be included in the headcount. Employers must ensure that data collection concerning gender identity is carried out as sensitively as possible. Those collecting the data must never rely on second-hand information or hearsay. Employers must engage with all employees about why they are seeking this data. They must ensure they obtain it directly from the individual or a trustworthy and reliable source. However, no one should be singled out and asked about their gender. Large group companies with numerous legal entities Many large organisations will wish to produce a single Gender Pay Gap report for their Irish operations. However, they need to be mindful that each legal entity in a group that employs more than 250 people has its own statutory reporting obligations. Nothing prevents the organisation from producing a consolidated report, however, if each legal entity also reports its individual statutory requirements within the consolidated report. There will also be cases where large organisations have entities that employ numbers below the reporting threshold. In our experience, though, companies tend to report on those entities—either within a consolidated report, or separately, to present the fullest possible picture of gender representation across its business and also in the interests of transparency. Where an organisation chooses not to report on smaller entities, the reasons behind that decision must be communicated fully, so they cannot be accused of a lack of transparency. Managing leave when calculating ordinary pay If a type of leave is paid, it is included in the Gender Pay Gap report. All pay received by every employee in the 12 months up to the snapshot date must be included in the calculation. However, this can give rise to anomalies. Take maternity leave, for example. Where maternity leave is paid, an employer may pay an amount to top-up statutory maternity benefit. Only the portion paid by the employer is included in the calculation, however, thereby artificially depressing the hourly pay rate of the employee in question. Where employees exercise an entitlement to additional unpaid maternity leave, this can further skew the figures. This will have to be looked at as it will be essential to explaining the anomalies in the circumstances arising for various cohorts of employees. Deirdre Malone is Head of Employment Law at EY Law Ireland

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. 

Technology is shaping the future of financial services and creating exciting opportunities for innovative professionals at the heart of the fintech revolution As Chief Executive of Swoop Funding, Andrea Reynolds occupies a unique position at the nexus of fast-changing trends in financial services, emerging technologies, and the evolving role of the financial professional. The Chartered Accountant established Swoop in 2017 with Ciarán Burke, the company’s co-founder, to develop software that could help accountants identify the best funding options for SMEs. “The platform has been used now by 75,000 businesses to access funding, ranging from equity and grants to loans and tax credits. That’s given us an interesting overview of how much technology is changing the world of finance,” said Reynolds. Headquartered in Dublin, Swoop was founded in the UK where Reynolds had been working as a management consultant with KPMG in London before deciding to go into business with Burke. “At the time, everyone was moving to cloud accounting and open banking was coming down the line with the EU’s Revised Payment Services Directive (PSD2). We were seeing these new fintech lenders emerging, offering alternative funding to businesses and consumers,” she said. “In accountancy, you are trained to solve a problem by breaking it down into smaller elements, and that’s basically what I did with Swoop. I built a platform that could bring all of these funding options together in one place and do the heavy lifting for accountants advising SMEs.” Five years on, Swoop is on course for expansion in North America and other markets, having recently raised €6.3 million in Series A funding. “Finance is increasingly data-driven and borderless and that creates opportunities for fintechs like us, but different markets also have different strengths and weaknesses,” said Reynolds, pointing to her experience launching her own start-up in Ireland and the UK. “The idea for Swoop originally came from my experience navigating the funding system for SMEs in the UK, which is a lot more fragmented than the Irish system,” she said.  “The flipside is that the UK has been much more open to alternative finance, as have other European countries. That’s meant a lot more activity in non-bank lending, whether that’s crowdfunding, or loan finance from the likes of Wayflyer, Clearco or Youlend.” By comparison, Ireland is in ‘catch-up mode’, but it is catching up fast, said Reynolds. “Wayflyer is a huge fintech success story and there are other alternative lenders in the Irish market, like Linked Finance, Flender, and Accelerated Payments.  “Ireland already has a very strong fintech base in regulatory technology, anti-money laundering, ID verification, and Know Your Customer (KYC) technology. Where we still have to build up momentum is in the area of open banking.”  Automating auditing For David Heath, FCA, it was his early experience training as an auditor that sparked the idea for Circit, the fintech venture he co-founded in Dublin in 2015. “I trained with Grant Thornton, and it was a really great experience because the firm was so ambitious and the clients so varied, but as an entrepreneur, your starting point is always ‘what is the problem and how can we solve it?’  “For me, it was a case of thinking back to those early years in my career and digging into the processes that were the most challenging,” said Heath. “Auditors typically have a good relationship with their clients but getting the information they need from third party evidence providers is a big pain point.  “You have to verify the information your client gives you with an independent source—usually a bank, law firm or broker—and that process can take anywhere from three to six weeks.” Heath saw an opportunity to solve this problem with the advent of PSD2, using the EU’s open banking regulation to create a digital verification platform for auditors.  A cloud-based open banking platform, Circit connects auditors to their clients’ banks, solicitors, and brokers, allowing them to verify information within seconds.  Circit is approved by the Central Bank of Ireland as an Account Information Service Provider (AISP) under PSD2. It works with more than 300 accounting firms in Ireland and overseas and recently closed a €6.5 million funding round. “The funding will help us to increase our footprint and build out our open banking and regulated products, leveraging the license we have from the Central Bank of Ireland,” said Heath. “The problem we’re addressing may be niche, but it has global application.” Global ambition This global ambition is a common trait among Ireland’s most promising fintechs, according to Matt Ryan, a director in the Financial Services Consulting Group at Deloitte Ireland. “The ones to watch—the ones that do well quickly—tend to be thinking globally from day one. They have the talent and the funding, but they also know that Ireland is a very small market, so they are thinking in cross-border terms from the get-go,” said Ryan. Ryan points to Transfermate and Wayflyer as two such Irish fintech ventures whose global vision is paying dividends. A business payments infrastructure company founded in 2010, Transfermate closed a $70 million funding round in May, valuing the Kilkenny fintech at $1 billion. Wayflyer secured $300 million in debt financing in the same month following a $150 million Series B funding round, closed in February, which earned the Dublin start-up a $1.6 billion valuation and coveted ‘unicorn’ status. The pandemic effect The speed with which Wayflyer’s revenue-based financing and e-commerce platform succeeded globally reflects a wider trend in fintech. “The pandemic really accelerated the development of the sector as businesses and consumers suddenly moved online en masse,” said Ryan.  “Fintech was already a fast-growing market, but COVID-19 has made digital and contactless payments the norm and that has catapulted financial technology into a new era of growth.” While fintech awareness among consumers tends to centre on high-profile digital banks like Revolut and N26, the fintech sector globally, and in Ireland, is far more diverse.  “People usually think of full stack providers like Stripe and Revolut when they think of fintech, but that’s really not the whole story,” said Ryan. “Equally relevant are the technology companies selling services and solutions to financial institutions. “There are some very successful Irish companies in this space, such as TansferMate and Fenergo, which specialises in KYC technology for banks.” Fintech in Northern Ireland The established financial services sector is equally important to the fintech ecosystem in Northern Ireland, according to Alex Lee, Executive Chair of Fintech Northern Ireland (Invest NI). Figures published last year by Fintech NI found that there were 74 fintech companies in the region and 7,000 people employed in fintech jobs. “The financial services sector here has a good track record of attracting foreign direct investment (FDI), particularly over the last 15 to 20 years,” said Lee. “Large institutions like Citi, Allstate, CME, TP ICAP and Liberty Mutual have all established a meaningful presence here.” Together, these US multinationals form ‘the foundation’ on which Northern Ireland’s fintech sector has continued to build, Lee said.  “Attracting big international players has helped to grow out our fintech expertise and talent pool, because most of these companies have global technology development centres running out of Northern Ireland, and that has contributed to the rise of some really successful homegrown fintechs,” he said. FinTrU is one such success story. Founded in 2013, FinTrU develops regulatory technology for investment banks, ranging from legal, risk and compliance, to Know Your Customer (KYC). The Belfast-headquartered company employs 1,000 people and, in July, announced plans to create a further 300 jobs at a European Delivery Centre in Letterkenny, Co. Donegal. Another scaling success story in Northern Ireland is FD Technologies (formerly First Derivatives).  Founded in 1996, the Newry-headquartered data firm employs 3,000 people at 13 offices in Ireland and globally and recently announced plans to create 500 jobs at a new technology hub in Dublin. Northern Ireland is also continuing to attract FDI. In June, the Bank of London announced plans to establish a Centre of Excellence in Belfast, creating 230 jobs by 2026.  “We are making strides now and my hope is for a homegrown fintech ‘unicorn’ to come out of Northern Ireland. We’re not quite there yet, but I would like to see this ‘poster child’ for the sector emerge soon,” said Lee. Decline of the unicorn Such is the pace of growth in the fintech sector globally, however, that even the much sought-after ‘unicorn’ moniker is losing its lustre.  “In developed markets at least, I think there is a view that ‘unicorn’ status has lost some of its cachet,” said Ian Nelson, FCA, Head of Financial Services and Regulatory at KPMG Ireland, and a member of the board of the Fintech and Payments Association of Ireland. Even Stripe—perhaps the best-known ‘unicorn’ with Irish origins—has outgrown the label.  Established in Silicon Valley in 2010 by Limerick brothers Patrick and John Collison, the online payments giant’s $95 billion market capitalisation has soared beyond the $1 billion unicorn requisite. “Stripe is really now a ‘centicorn’, if you like, and there are numerous other fintechs in the same sphere, and ‘decacorns’ valued at $10 billion coming up behind them,” said Nelson. “At $1 billion, becoming a ‘unicorn’ has less meaning for fintech start-ups in developed markets, but it will continue to be an important building block for start-ups in emerging markets and less mature fintech hubs.” Among the other trends Nelson is keeping an eye on is the role technology will play in supporting environmental, social, and governance (ESG) capabilities in business. “Since COP26, we have seen a lot of attention directed towards fintechs with ESG capabilities,” he said.  “This really reflects the growing prioritisation of ESG in financial reporting and financial services generally. ESG is going to be a really important play in fintech. “We can expect to see more fintech companies focused on climate change, decarbonisation and the circular economy, and more jurisdictions setting up incubators specifically focused on ESG solutions.” Digital innovation in financial services Already a leader in payments globally, Ireland is now shaping the business environment for digital finance, writes Seán Fleming TD, Minister of State at the Department of Finance As Minister of State with responsibility for financial services, I lead the whole-of-government strategy for developing international financial services in Ireland, titled Ireland for Finance. I very much welcome this timely report on fintech.  In recent years, new entrants and long-standing financial institutions have looked to capture the opportunities presented by digital technologies.  Ireland is well-placed to benefit from the application of new technologies in the financial services industry. We have both a well-developed financial centre and a renowned technology sector.  This makes Ireland a centre of excellence for start-ups and big-name companies that want to establish operations in the European Union.  Ireland has shown leadership in shaping the business environment for digital finance. Important to this is Ireland’s education system, which has produced some of the finest innovators in the world. These graduates are leading the development of cutting-edge technologies.  The Government has an ambitious agenda for education. Two out of 15 Cabinet Ministers are dedicated to education and skills. Consecutive Governments have invested substantially in education, making it a cornerstone of Ireland’s economic strategy.   This economic strategy has created a strong mix of multinationals that have chosen Ireland as a place to do business. We have been very successful in supporting high-potential start-ups, with over 200 Irish fintech firms at various stages of development. Ireland is a leader in payments, and a number of firms have substantial development operations here. The digital finance ecosystem has expanded in recent years to include institutional financial services providers that have chosen Ireland to help them develop their fintech capability. The importance of fintech is reflected in the Ireland for Finance strategy. I identified Fintech and Digital Finance as one of the five themes in Action Plan 2022.  The Department of Finance’s Fintech Steering Group leads the cross-government approach with other departments and state agencies, and with representatives of the financial services and information technologies industries, and third-level researchers. Financial Services Ireland, the Ibec sector representing financial services companies, recently identified the future talent pipeline as being critically important. Particular areas they identify are fintech, digital finance and the environmental, social and governance agenda. I will shortly be publishing the updated Ireland for Finance strategy and fintech will be a key theme, and it will be at the centre of our work in the coming years.

Russia’s War in Ukraine changed many assumptions held by European governments, but Judy Dempsey asks is Europe prepared to embrace significant strategic issues that will change the status quo? Russia’s full-scale invasion of Ukraine in February could radically re-shape the European Union.  And it’s about time.  For too long, the EU and most member states were content in the comfort zone that did not have to deal with issues that would fundamentally change their way of doing things. These included energy, security, the future of enlargement and Russia. Until Russia’s second invasion of Ukraine, there was a tactic consensus that Europe could continue along the path of perceiving Eastern Europe through the prism of Russia and depending on Russian energy. The EU accepted the independence of Ukraine, Moldova and Georgia, not to mention Belarus. However, among many big member states, their sovereignty and independence were ambiguous.  While it was never publicly stated, this part of Europe, whose history and culture are unknown to many EU member states, was considered in Russia’s sphere of influence. In several ways, Russia’s all-out attack on Ukraine has changed that perception. First is the energy issue. It is only a matter of time before Europe will wean itself off Russian gas and oil. This dependence had given President Vladimir Putin immense leverage and blackmail over several EU countries, particularly Germany.  The EU, and German Chancellor Scholz’s Green coalition partners, say they now want to become independent from Russian energy as soon as possible. Despite the considerable pressure from German industry and its business lobbies tied to Russia, who wish to retain the status quo with Moscow, don’t underestimate this goal.  The reality is that Russia’s war in Ukraine has become the catalyst for speeding up Europe’s transition to renewable energy and alternative sources of supplies. As dependence on Russian gas decreases, so will the Kremlin’s geopolitical influence. Another impact of Russia’s aggression is security. Neutral Finland and Sweden are poised to join NATO. These two countries that have long cherished their neutrality now recognise that their security needs to be boosted. Joining NATO would fill a big security vacuum in Northern Europe, where Denmark and Norway are members of the US-led military alliance. The Baltic (NATO member) States will be more than reassured with Finland and Sweden on board. In short, Putin’s aggression in Ukraine has given NATO and the transatlantic alliance a new lease of life. It is changing the geo-security architecture of Europe. It will be interesting to see how Ireland deals with its long-standing neutrality stance.  Another big issue is enlargement that is tied to the future direction of Europe. President Emmanuel Macron’s speech at the conclusion of the Future of Europe conference set out how to make the EU more efficient by having a qualified majority voting system for certain policy issues and having a much closer, structural relationship with Eastern Europe.  But what about making the EU more politically integrated? This would require a treaty change that several member states oppose. However, this is where the war in Ukraine comes into play. European governments cannot retain the status quo when its own security and that of its eastern neighbours are at stake.  For a union with ambitions to be a global player, muddling through is no longer an option. It’s going to require a major shift in the mindset of EU countries to end Europe’s comfort zone that, until now, didn’t take its – nor Eastern Europe’s – security vulnerability seriously.  If it doesn’t make that shift, Europe will fail to use the war in Ukraine to develop a strong, integrated and secure Europe – with Eastern Europe as part of that house.  Judy Dempsey is a Non-Resident Senior Fellow at Carnegie Europe and Editor-in-Chief of Strategic Europe.

The Russian invasion of Ukraine has given rise to potentially complex financial reporting considerations for Irish companies with a presence in one or both territories. David Drought delves into the details of two areas of concern. The ongoing conflict in Ukraine, and resulting sanctions and counter sanctions imposed globally on and by Russia, have impacted certain companies.  Although the conflict is first and foremost an immense human tragedy for those involved, companies whose operations have been affected will need to consider the financial reporting implications.  Here, we consider two potential issues—the first being whether control of subsidiaries located in Russia has been lost, and the second being whether impairment tests of non-financial assets in the affected territories should be carried out. Do you continue to control your subsidiary?  Under IFRS 10 Consolidated Financial Statements, a company (investor) controls a subsidiary (investee) when it has power over the subsidiary, is exposed to variable returns from its involvement with the subsidiary, and can also affect those returns by exercising its power. Control requires power, exposure to the variability of returns, and a linkage between the two. Continuous control assessment  Suppose the facts and circumstances indicate that there are changes to one or more of the elements of the control model. In this scenario, an investor must reassess whether it continues to have control over the investee.  Here, companies will need to consider whether the consequences of the ongoing conflict lead to changes in investors’ relationships with investees in Russia. As a result of the effects of the ongoing conflict, for example, foreign investors may: face difficulties in repatriating funds from investees; exit or cease operations in these markets, either by choice or by being forced to do so because of sanctions imposed; or be impacted by potential new restrictions imposed on foreign owners – e.g. nationalisation of local operations. The hurdle for losing control of an existing subsidiary is generally high, but the loss of control of subsidiaries in the conflict-affected countries or regions should not be immediately presumed.  There is, for example, no exclusion from consolidation due to difficulties alone in repatriating funds from the subsidiary to the parent or the lack of exchangeability of currencies.  In considering the impact of these ongoing conflicts, management must consider these two critical elements of control: power and returns. Power When assessing power over the investee, an investor considers only substantive rights relating to an investee – i.e. rights that it has the practical ability to exercise.  Determining whether rights are substantive requires judgement. Whether there are any barriers due to the consequences of the ongoing conflict preventing the holder from exercising these rights should be considered (e.g. due to current sanctions a company may no longer be able to exercise rights previously available to it.) Returns When assessing returns, an investor evaluates if they are exposed to variable returns from involvement with an investee. The sources of these returns may be very broad and may include both positive and negative returns.  Sources might include dividend or other economic benefits, for example, remuneration for services provided to the investee, tax benefits or certain residual interests.  Management should consider whether the company’s exposure to the variability of returns has been impacted and needs to be reassessed. IFRS 10 does not establish a minimum level of exposure to returns to have control.  Where there has not been a loss of control, there may be other impacts to consider. These might include: possible impairment of the investment in the subsidiary; presentation of the subsidiary as held-for-sale or as a discontinued operation; or  possible impairment of the assets held by the subsidiary. Do I need to test my non-financial assets for impairment? Control in relation to other assets  Before considering impairment for companies with assets on the ground in Russia or Ukraine, it is necessary to assess whether they have, in substance, lost control of those assets.  Control in the context of assets generally means the practical ability to control the use of the underlying asset. If control has been lost, the asset is derecognised in its entirety, and no impairment is carried out. IAS 36 Impairment of assets  The standard requires management to assess whether there is any indication of impairment at the end of each reporting period.  Irrespective of any indicator of impairment, the standard requires goodwill, and intangible assets with indefinite useful lives (and those not yet available for use) to be tested for impairment at least annually. An annual test is required alongside any impairment tests performed as a result of a triggering event. Triggering events  The likelihood that a triggering event has occurred for non-current assets has increased significantly for companies that: have significant assets or operations in Russia or Ukraine; are significantly affected by the sanctions imposed and/or Russia’s counter-measures; are adversely affected by increases in the price of commodities; and/or are significantly affected by supply chain disruption. Impairment indicators  Indicators of impairment may come from internal or external sources, but the likelihood of some impairment indicators existing has increased for companies impacted by the Russia-Ukraine war. Some indicators that may arise include: the obsolescence or physical damage of an asset. For example, plants and operations in Ukraine may be subject to physical damage; significant changes in the extent or manner in which an asset is (or is expected to be) used which has (or will have) an adverse effect on the entity.  a significant and unexpected decline in market value; significant adverse effects in the technological, market, economic or legal environment, including the impact of sanctions on the entity’s ability to operate in a market; a rise in market interest rates, which will increase the discount rate used to determine an asset’s value in use; and the carrying amount of the net assets of an entity exceeding its market capitalisation. Falling stock prices may result in an entity’s net assets being greater than its market capitalisation. Abandonment or idle assets  Companies may have abandoned—or have considered a plan to abandon—certain operations or properties in Russia or Ukraine.  Some companies may have been forced to abandon owned or leased facilities in Ukraine as a result of the war, for example. In such cases, the company needs to accelerate or impair the depreciation of the property based on the revised anticipated usage or residual value. Assets lefts temporarily idle are not regarded as abandoned—for example, when a company temporarily shuts a manufacturing facility but intends to resume operations after military activities in the area abate.  Although temporarily idling a facility may trigger an impairment of that item (or the CGU to which it belongs), a company does not stop depreciating the item while it is idle—unless it is fully depreciated or is classified as held-for-sale. Companies should, however, consider the most appropriate depreciation method in this situation.  Disclosures When reporting in uncertain times, it is essential to provide the users of financial statements with appropriate insight into the key assumptions and judgements made by the company when preparing financial information. Depending on an entity’s specific circumstances, each area above may be a source of material judgement and uncertainty requiring disclosure. David Drought is a director in the Accounting Advisory team at KPMG in Ireland