CFOs can play a 'crucial role' in coronavirus crisis, says IMA
CFOs can play a crucial role in guiding employees, particularly those in the finance and accounting functions, during the turmoil of the coronavirus pandemic, which is roiling the stock market and leading to mass layoffs.
Doreen Remmen, CFO of the Institute of Management Accountants, sees her fellow CFOs trying to contend with the crisis. “So many people are dealing with layoffs and furloughs among family members,” she said. “It’s a heavy, heavy burden for the CFOs now. My mind went to people who have been furloughed. Marriott announced that they are putting tens of thousands of people on furlough. My son, a financial analyst, was furloughed. Another [Marriott] employee who’s in the IMA was also furloughed.”
CFOs who don’t have to deal with layoffs within their own organization can help their employees stay sane. “What I would say to CFOs who are working in companies who don’t anticipate a furlough, who don’t anticipate mass layoffs, is to keep calm and communicate with staff,” said Remmen. “Communication is absolutely critical right now. Projecting calm is really, really important. Communication is even more critical for those companies who are seeing trouble on the horizon, like hospitality [businesses] and restaurants, having to make very difficult decisions.”
CFOs should communicate with appreciation and compassion if they do have to lay off employees.
“Personal communication is also pretty important,” Remmen added. “Not just the one-time communication: ‘Sorry, we have to let you go.’ Check in with them a week later and encourage them. Those people are family, and to be cut off from their work family is so traumatic. If you are working on getting financing and bringing the business back to life, make sure you communicate that, and communicate it honestly."
"One thing that is really important that my son told me: Don’t communicate how things are for you," she continued. "This isn’t the time for that. This is the time to focus on that employee. ... Don’t cut people off. Give them information about how to apply for unemployment insurance. Many people haven't gone through the process. Give them information about the Family First [Coronavirus Response] Act, the legislation that is coming through from the federal government that can be a help to them.”
CFOs also need to stay in touch with their banks, suppliers, customers and employees during the outbreak.
“It’s very important to communicate with your lenders,” Remmen suggested. “If you think you’re going to miss a loan covenant, you may have other assets that you can use as collateral, or your bank may have a program in place. Communicate with your suppliers, with your customers. Keep that business alive. Retain your reputation as an employer of choice, as an employer that people really want. The CFO has a key role.”
One way that many organizations are literally keeping their employees alive is by relying more on telework and remote video-conferencing technology like Zoom, Google Hangouts, GoToMeeting, Webex and Skype, among others.
“We’re all working remotely right now, and we’ve all had to acquire some new skills,” said Remmen. “Video conferencing and supervising staff who aren’t working at the next desk, checking in every day, and keeping the social camaraderie going — it’s really important to focus on those things. There may be people on your staff who can work just as efficiently remotely as in the office, and maybe they’ve been doing that. And there may be others who can't. Keep them employed. If this is a temporary situation, sign them up for an online training course in something related to their jobs. We have one gentleman who has been a longtime employee in our facility. He comes up with a playlist for the rest of us to keep calm. He finds ways to keep in touch with us and keep connected with us and trying to make everybody feel connected.”
In finance departments, it’s especially important to make sure that employees are taking good care of their cybersecurity when working remotely during the COVID-19 pandemic. Cyberthieves are already trying to take advantage of the crisis, making fraudulent offers of cures and treatments by email and over social media. Companies need to take strong measures to make sure their financial and personal information remains confidential.
“I talked to our IT team about it,” said Remmen. “They said the biggest concern is phishing. I’ve seen that myself in my emails, which are typically filtered. A lot of those emails are coming from vendors I don't recognize asking me to click on a link to get more information about COVID-19. The concern is that there are phishing attempts and employees need to be really careful about what they’re clicking on. Hopefully people are using VPN networks and other security networks to keep their confidential information safe.”
Until recently, the talent shortage and employee retention were popular topics of discussion, especially for accountants. But now, with mass layoffs starting to happen, employees who used to feel secure in their jobs no longer do, even those with the most up-to-date skills in demand.
“There’s been so much anxiety,” said Remmen. “People who are in absolutely no danger of losing their positions are absolutely very anxious. The CFO has to project calm. For people who are severely impacted, the CFO needs to communicate with compassion and appreciation and information about benefits that they may be able to get, like about COBRA insurance, all the things they need to educate themselves and help their staff.”
CFOs may need to re-examine the pay arrangements of their employees. “The CFO has a really important role in designing compensation plans that are aligned with the strategy,” said Remmen. “Right now in this environment you need to look at people who are earning most of their compensation through commissions. To retain your best and most talented individuals, remember that this is a temporary situation and we need to get through it.”
CFOs at publicly traded companies need to make sure they are providing the appropriate disclosures related to the coronavirus to the Securities and Exchange Commission. But for privately held companies, CFOs should be sure to be just as upfront with their employees.
“They need to recognize that their employees are very important stakeholders,” said Remmen. “You need to take care of those stakeholders.”
Until the current crisis, that may have included priorities like career development opportunities for staff, and hopefully those practices will resume once the outbreak is over. “The CFO, especially in good times, needs to be focused on building their employees’ career path,” Remmen added. “Make sure each employee is building their resume with new skills all the time.”.