Study: Amid Sustainability Push, More Sustainability Roles are Emerging for Accountancy Profession, such as the Chief Finance & Sustainability Officer

- CFOs already play an important role in sustainability. Among the companies interviewed, more than half of the Chief Sustainability Officers report to the CFO.

- With their financial reporting background, accountancy and finance professionals with sustainability skills have an edge in driving the sustainability transition in businesses.

- The emerging Chief Finance & Sustainability Officer (CFSO) role, which integrates finance and sustainability into business strategy, is a C-suite position overseeing the CFO and Chief Sustainability Officer.

25 August 2022 – Sustainability is creating new roles for the accountancy and finance profession, according to “Sustainability – Jobs and Skills for the Accountancy Profession”, a joint study by the Institute of Singapore Chartered Accountants (ISCA), Ernst & Young Advisory Pte. Ltd. (EY), Singapore Management University (SMU) and Singapore Accountancy Commission (SAC).

Chief Finance & Sustainability Officer is an Emerging C-suite Role
The study identified the Chief Finance & Sustainability Officer (CFSO) as an emerging C-suite position. The CFSO could be placed above today’s CFO and CSO functions to oversee the integration of finance and sustainability into business strategy. The CFSO will require critical technical skills in sustainability reporting and target setting and integrating sustainability into corporate strategy. For example, the CFSO may be tasked to translate the environmental, social, and governance (ESG) impact of business activities, such as carbon emissions and pollution, into financial metrics to guide corporate strategy and meet sustainability targets. The CFSO will also require business partnership skills, such as stakeholder engagement and transdisciplinary thinking. Accountancy and Finance Professionals, with their financial expertise, are in an advantageous position to helm the emerging role of the CFSO.

ISCA President Mr Teo Ser Luck said, “The findings show that accountancy and finance professionals play a critical role in integrating sustainability into businesses.  They are called to be stewards of corporate sustainability strategies by facilitating the sustainability transition for businesses. With their professional knowledge, they are able to take a leading role in helping businesses in the process. On ISCA’s part, we are committed to supporting the profession and equipping our members to seize new opportunities arising from the transition to a Green Economy.” 

Decarbonisation, Sustainability Reporting and Green Finance Driving Expansion of Roles for Accountancy and Finance Professionals
The study found three key trends in sustainability that will expand the current job roles and skills required for accountancy and finance professionals. The three key trends are:

1. Decarbonisation of the environment
2. More companies participating in sustainability reporting
3. Expansion of green finance

With decarbonisation becoming a global imperative and a priority for governments, there is increased demand for carbon accounting, markets, and trading. International carbon markets are becoming better regulated and stakeholder demands to offset carbon emissions and achieve net zero targets will continue to grow. With the increased emphasis on sustainability and climate-related regulatory requirements, more companies are also adopting sustainability reporting. This is likely to continue with the establishment of the International Sustainability Standards Board (ISSB), which aims to introduce a global baseline for sustainability reporting. Green finance has also seen substantial expansion in green loans, bonds, and investment opportunities. [1]

“Sustainability, as a topic and a trend, covers more than finance. However, the role of sustainability in finance will soon be more than just a task and potentially one that requires focus, attention and perhaps even a separate full-time role to be carved out,” said Mr Samir Bedi, Partner, EY Asean Workforce Advisory Leader and EY Singapore Government & Public Sector Leader.

Accountancy and Finance Professional Need Additional Green Skills 
Additional skills will be required to meet the demands of these three key trends in sustainability. The study identified additional skills required for preparers of financial reporting and assurance service providers.  Examples of preparers of financial reporting include CFOs, Finance Managers, and Internal Auditors.  Assurance service providers include audit professionals from accounting firms who help companies identify their reporting parameters.

For CFOs and finance managers, there will be increasing need for them to manage carbon trading. Accountancy and finance professionals need to be knowledgeable in carbon markets, credits, and measurement of emissions, as well as sustainability reporting frameworks, guidelines, and principles. A global perspective is needed to navigate different regulations and sustainability frameworks, both regionally and internationally. Accountancy and finance professionals in corporate finance roles also have to acquire skills in green finance and sustainability risk management.  These skills are key to making the most of the burgeoning opportunities in green finance, while also assessing sustainability risks.

Audit and assurance professionals require upskilling in carbon accounting and assurance to ensure the quality of information to stakeholders. They will also be called upon to enhance internal processes. Audit professionals in tax must understand and apply carbon tax regulations and guidelines, to ensure compliance in diverse regulatory environments, both regionally and globally.

Commenting on the new and additional skills required of accountancy and financial professionals, Professor Cheng Qiang, Lee Kong Chian Chair Professor of Accounting, Dean of School of Accountancy, SMU, said, “To meet the rising demand of sustainability accountants, we have adapted our educational curriculum to include existing and emerging frameworks for developing corporate ESG performance metrics, assessing their reliability, reporting to stakeholders, and incentivising managers based on ESG performance metrics. We hope it will help to ease the skills gap in the accountancy sector.”

In support of this joint study, SAC Chief Executive Mr Evan Law said, “Sustainability is changing how businesses operate, and the professional accountant’s role is at the heart of this transformation. They know how businesses work and thus, they are well-placed to guide businesses in meeting their sustainability goals. As such, it is essential that they equip themselves with the skills to handle emerging areas in sustainability such as carbon and greenhouse gas accounting, green financing, and sustainability reporting; and support Singapore’s drive to a more sustainable future.”

The study involved in-depth interviews with 23 C-Suite leaders across 10 business sectors. The interviewees include corporate executives, financial professionals, and representatives of government agencies and non-government organisations (NGOs) in Singapore. The executives and financial professionals hold titles such as Chief Executive Officer (CEO), Chief Financial Officer (CFO), Chief Sustainability Officer (CSO), Head of Finance, Head of Sustainability, and Partners and Consultants.

Access the full report from: https://isca.org.sg/resource-library/sustainability/sustainability-jobs-and-skills

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About the Institute of Singapore Chartered Accountants
The Institute of Singapore Chartered Accountants (ISCA) is the national accountancy body of Singapore. ISCA’s vision is to be a world-class accountancy body of trusted professionals, contributing towards an innovative and sustainable economy. There are over 33,000 ISCA members making their stride in businesses across industries in Singapore and around the world.

Established in 1963, ISCA is an advocate of the interests of the profession. Complementing its global mindset with Asian insights, ISCA leverages its regional expertise, knowledge, and networks with diverse stakeholders to contribute towards the advancement of the accountancy profession.  

ISCA is the Designated Entity to confer the Chartered Accountant of Singapore – CA (Singapore) – designation.

ISCA is a member of Chartered Accountants Worldwide, a global family that brings together the members of leading institutes to create a community of over 1.8 million Chartered Accountants and students in more than 190 countries.

For more information, visit www.isca.org.sg.

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This news release has been issued by Ernst & Young Advisory Pte. Ltd., a member of the global EY organisation.

About Singapore Management University
Established in 2000, Singapore Management University (SMU) is recognised for its disciplinary and multi-disciplinary research that address issues of global relevance, impacting business, government, and society. Its distinctive education, incorporating innovative experiential learning, aims to nurture global citizens, entrepreneurs and change agents. With more than 12,000 students, SMU offers a wide range of bachelors, masters and PhD degree programmes in the disciplinary areas associated with six of its eight schools - Accountancy, Business, Economics, Computing, Law and Social Sciences. Its seventh school, the SMU College of Integrative Studies, offers a bachelor’s degree programme in deep, integrative interdisciplinary education. The College of Graduate Research Studies, SMU’s eighth school, enhances integration and interdisciplinarity across the various SMU postgraduate research programmes that will enable our students to gain a holistic learning experience and well-grounded approach to their research.  SMU also offers a growing number of executive development and continuing education programmes. Through its city campus, SMU focuses on making meaningful impact on Singapore and beyond through its partnerships with industry, policy makers and academic institutions. For more information about SMU, please click here.

About Singapore Management University – School of Accountancy
Established in 2001 as the second school in SMU, the School of Accountancy (SoA) offers the distinctive programmes: Bachelor of Accountancy, Master of Professional Accounting, Master of Science in Accounting (Data & Analytics), SMU-Tsinghua Master of Science in CFO Leadership, SMU-Zhejiang Doctor of Business Administration (Accounting and Finance), and PhD in Accounting. SoA pursues excellence by offering academic programmes that are responding to the needs of accounting and finance professionals. SoA continues to receive international recognition for its research strength. In 2022, SoA is ranked first in the world for Archival Research (All Topics and Financial Accounting) and Citation Rankings in the BYU accounting research rankings. The achievement is a strong testament to the commitment of SMU faculty towards developing high quality accounting research and placing SoA as a global leader among accounting schools in renowned universities. For more information about SoA, please click here.

About Singapore Accountancy Commission
The Singapore Accountancy Commission (SAC) spearheads the development of the Singapore accountancy sector with the vision of developing Singapore into a leading global accountancy hub. SAC is working to achieve this by deepening the skills of the accountancy talent pool; developing the industry to capture growth opportunities; and creating a hub and exchange by building Singapore into a centre for thought leadership. SAC is a statutory body under the Ministry of Finance. For more information, please click here.