A resilient data structure has become a mandatory part of measuring, managing and transforming business for long-term value creation. Financial consultants, Accordion published a playbook for CFOs in 2022, emphasising how finance has become critical in delivering a strong foundation to support ongoing strategy and generate value creation.

Driving that focus on finance is the disruptive and volatile economic conditions we are experiencing, causing many organisations to enhance their people, processes and technologies to drive the added value they need. 

At the core of this process is data and analytics. Once considered as an afterthought, data and analytics is now a priority for CFOs. Stakeholders expect information and insights based on real-time data, which facilitates the need for a comprehensive data strategy and for accurate and reliable analytics. CFOs and investors expect performance visibility that can support data-focused business decisions. 

While the CFO playbook still resonates today, there has been one particular shift in the last year: a rise in focus on data and analytics. The latest playbook focuses on the following key points:

Measure Liquidity

Closely monitor factors influence receivables and identify any factors such as one-off payments, debt or large vendor payments. CFOs should recognise and prepare for this potential impacts on a business.

Refocus on performance visibility

Many finance team measure against dated strategy plans and as a consequence, the report delivered don’t necessarily align with the correct KPs. CFOs must collaborate with investors and determine the value creation factors to deliver the right KPIs to generate a structured reporting strategy. This approach will ensure finance teams convert data into actionable insights and people can make informed decisions.

Determine the future technology

CFOs must explore and invest in the right tech stake in order to generate optimum financial and operational  reporting. 

Invest in new talent

After determining the right tech, a CFO must also invest in a team capable of navigating these systems. A priority hiring need for CFOs is finding finance talent with the necessary data skillset to leverage technology and utilise the power of data. A collaboration between finance and technology is more critical than ever. 

Establish the necessary data foundation

CFOs need continuous access to metrics to recognise factors influencing performance. While this may seem obvious, large quantities of valuable data is often hidden in legacy systems, meaning it is ineffective for delivering vital insights. Achieving this visibility requires the CFOs to leverage their systems and create a single source of truth that gathers and examines all data for analysis. 

Deliver vital analytics and insights

Without delivering a data foundation, finance will spend excessive time manually gathering data. With a single source of truth, CFOs reduce time spent on data analysis and focusing more time on high value activities. 

Create integrated business planning

Streamlined forecasting is pivotal in business management. Stakeholders will expect CFOs to utilise real-time data. While forecasting is a vital part of the CFO role, new CFOs must prioritise cash flow as a critical part of the business planning process, educating and working company leaders. An enterprise-wide approach ensures cash forecasting is connected to the business forecast and supply & demand planning, which is critical for business success.

Plan for the budgeting process

The CFO must act as a strategy leader, examining assumptions, creating processes to hold business leaders accountable, and delivering targets based on valued insights, creating efficient resource allocation and more informed business decisions. 

Prioritise performance factors

CFOs will collaborate with stakeholders to create an updated value plan, build a valued data and analytics framework and create new visibility into the state of the organisation. CFOs have the ability to generate insights into factors influencing performance, enabling them to prioritise performance factors.

Work with stakeholders on finance-focus transformation plans

Now is the time for CFOs to collaborate with sponsors and the wider business, to adapt transformation plans into action. 

While the general playbook for CFOs remains relatively the same, data and analytics are a part of every element of the role of the CFO.

At the recent MRS data-driven insights conference, industry leaders discussed what ‘data-driven insight’ means for businesses. Liz Lamb, head of data and insight at Card Factory, explains that she typically combines finance, data and insight to determine the potential ROI. 

Data-driven insights are based on genuine trust and confidence that this information will help a business make the right decisions in a turbulent time when marketing budgets are vital and ensure any investment made is effective. Understanding these insights means an organisation has the trust and confidence to make the right decisions.

Businesses are deciding to become more data-driven. For example, the media agency, The7Stars, took the step to merge a traditional research team with a traditional data expert team. These were two teams that stood apart and required time and effort to enable both to work together. Today, the teams collaborate on data and insights, democratising how data is discussed and helping them bring the two together.

Many businesses remain relatively fragmented when it comes to data and insights. Bringing together the potential of data analytics is challenging, it takes significant resources and budget to implement this process. 

Communication within a business remains paramount, especially to ensure all associated stakeholders understand and recognise the importance and value of data insights. 

Businesses working effectively with data insights will try to demystify the process and take them on the journey so they feel assured in any proposed methodology. A considerable amount of effort is applied to ensuring people understand what happens behind the scenes.

More businesses are implementing new technologies to generate more valued data-driven insights. While technology has enabled some automation, data professionals are still essential in determining how to use these tools properly and find the most valuable insights from the data provided. Data research has become a vital part of how we work today and how to deliver a strategy. 

The research stage has shifted to the start of the planning process rather than previously as an afterthought. Research and data insight has become critical in driving general business decision-making. 

The biggest shift in the research market is the rising application of more innovative tools, like AI-based solutions. Forecasts expect researchers will continue to feel more confident accessing these tools in their work in the future.

Data research is transforming from an added service to a valued strategic asset. Data professionals are considered problem-solvers, identifying opportunities and potential risks.

ESG has become a top priority for many companies, but with mounting concerns surrounding greenwashing, how businesses accurately measure their global impact is critical. ESG data represents a valuable resource and could help increase access to funding, especially for smaller organisations.

In recent years, the requirement for higher levels of transparency on ESG impact from businesses has increased. With progression worldwide, like the 2020 EU Taxonomy and Corporate Sustainability Reporting Directive (CSRD) regulation, these concerns have become top priorities for investors and financial businesses. ESG data has evolved into a vital way for companies to quantify their global impact. Regulation surrounding the development of ESG data, including the EU taxonomy, has supported companies, but there is an evident disparity between the businesses capable of producing accurate ESG data when required.

While SMEs make up approximately 90% of businesses worldwide, with minimal to no regulatory pressure to deliver ESG data, a considerable data gap is evident between smaller and larger companies. While there are ways for SMEs to determine their data indicators, the range of methodologies and the lack of primary data can generate skewed results or potentially highly inaccurate results. These anomalies create various challenges when it comes to finding finance. As ESG concerns have increased, investors are gaining further interest in the climate and social impacts of their plans, and many have started using ESG impact as a technique to determine how a business is managing its risk. 

The investor demand for sustainable options is growing significantly. Sustainable bonds, whether it be green bonds or other transition bonds, have sparked investment in environmentally or socially beneficial projects or businesses. Data is vital to determining if a project is applicable for this type of investment and assessing whether a project has met the standards after issuance. So, SMEs that lack accurate data, will find it challenging to access these credit options available within the sustainability field. 

Accessing high-quality and accurate ESG data will improve SMEs’ financing opportunities. Staying in touch with ESG will help businesses keep a competitive edge in the future.

Although SMEs remain exempt from the EU’s Taxonomy Regulation, this will likely change as governing bodies continue pushing for more sustainable business practices. The environmental and social amendments to the Companies Act in the UK are another sign that we can expect further changes to economies worldwide. SMEs that can have their ESG impact to hand will have the competitive edge, pre-empting regulations that may impact their operation and ensure speedy compliance.

What can companies do more/better?

So, what is the key to improving ESG data availability for SMEs? One way is through harnessing a range of alternative sources of data. By using corporate ESG data collected through annual reports, media, and legal records, SMEs have the potential to build a rounded and accurate ESG profile.

The problem is that this data is often disparate and challenging to collect and analyse efficiently. This is where technology comes in, allowing SMEs and financial institutions to automate how ESG data can be assessed using less obvious sources, such as the media and court cases, to build an ESG profile for companies, no matter the size, type of operations and quantity of official ESG data published. 

As ESG concerns continue to grow in importance across the global economy, SMES must stay one step ahead. Harnessing the power of technology can level the playing field for SMEs, providing access to finance for underserved businesses and ensuring compliance in an increasingly complicated world of regulation.

Financial analytics has become a critical factor for success in modern business. Most companies are starting to invest in big data analytical tools to deliver cost savings and increase revenue and productivity. According to reports, the data analytics market is expected to expand considerably, exceeding $221 billion in 2027.

The rise of technology plays a pivotal role in supporting market growth. At the same time, challenges such as increased competition to changes in customer preferences and compliance rules and financial analytics for companies have become valuable tools for delivering informed decisions and enhanced performance. Financial data analysis provides critical insights into operations and various industry trends, managing risk and resource allocation. Financial data is essential to remain competitive and on top of industry trends.

The Reasons and Benefits of financial analytics for Businesses

Enhanced decision-making: In today’s environment, it’s become even more important for companies to make quick decisions based on transparent and reliable insights. One valuable tool for this process is financial analytics for businesses. By interpreting financial data, companies can determine performance patterns and make critical decisions. Financial analytics enables companies to perform calculated risks. It allows businesses to proceed with data-driven plans that could give them the added boost required to drive further success in the future.

Trend Identification and Analysis
Identifying and measuring trends can be a powerful tool for financial analytics. By measuring data points over a selected period, companies can create valuable insights into their market position, performance and potential growth opportunities. Growth opportunity assessment depends heavily on identifying trends and analysis. Financial service businesses can explore customer behaviours and market conditions to determine new investment products that meet requirements, creating new revenue opportunities.

Managing and mitigating risk
Financial analytics provides tools to measure risk and implement the necessary response. For example, a bank can explore its loan portfolios with financial analytics and introduce actions needed against high-risk loans. The bank can then implement stricter credit plans or increase the rules for collateral to alleviate any potential financial losses. Risk management is an essential part of financial analytics that businesses should consider. Through detailed assessment of financial data, companies can identify potential risks and introduce safeguards to eliminate potential cases of economic loss.

Opportunities to save money: Allocating resources correctly is a vital part of financial analytics for companies that can result in cost savings and higher profits. With the support of financial analytics, a company can measure spending and determine where to invest funds to enhance efficiency and reduce expenses. Cost savings opportunities are a vital part of financial analytics for businesses. By gaining deeper insights into operations and investments, companies can make data-driven decisions that improve success in the long term.

Complete transparency: Financial analytics enables businesses to explore past financial data and use it to predict future scenarios. This predictive element of analytics improves budgeting and forecasts and provides organisations with the necessary details to prepare for market changes or impacts on resource allocations. Overall, investing in financial analytics for budgeting and forecasting enables companies to have more clarity when allocating resources, maximising potential profits and reducing overall expenses.

Creating a competitive advantage – financial analytics gives businesses a competitive advantage. By utilising financial insights, companies can understand trends and patterns that could be missed by competitors. For example, analytics can determine customer purchasing behaviours and which demographic prefers online transactions. With this level of data, companies can be more strategic with resource allocations and develop marketing campaigns to attract new customers.

Detecting and preventing fraud: Businesses can greatly benefit from financial analytics by minimising potential fraud cases. Fraudulent activities can be very damaging, financially and on a reputational basis. Financial analytics can provide insights into suspicious customer behaviour, like large transactions from various locations.
Regulatory compliance – Remaining compliant with current regulations is critical in operating a successful business. Companies must be aware of all relevant legislation and take action to remain compliant. By having access to financial information and detecting any possible compliance issues, businesses can initiate the necessary steps. Financial analytics can support the delivery of more thorough audits, ensuring they are compliant with all regulations.

Allocating resources effectively: Maximising resource efficiency is an advantage of utilising financial analytics. Businesses can assess their data to determine ways to lower costs, enhance operational productivity and create new growth opportunities. By accurately measuring and understanding data, businesses can utilise critical resources and position themselves for long-term success.

Improving communication with stakeholders: Financial analytics has proven critical for stakeholder communication. It enables businesses to deliver transparent and structured reports and digital insights on financial performance that build stakeholder trust and confidence. Furthermore, improved forecasting options help stakeholders understand the business in more detail and its future development plans. Analytical tools enable more informed strategic decisions, increasing transparency and positioning them for long-term success.

Digital technology has transformed the finance industry by enhancing the customer experience, improving operational efficiency and reducing overall costs. AI, big data analytics and automation are top trends reshaping the finance industry. There are challenges, however, including regulatory compliance, outdated tech systems, security, the demand for talent and the potential risk of losing connection with personal banking.

Digital banking today has transformed our personal experience with our finances. From mobile payments to AI-driven technology, the finance industry is rapidly changing. The traditional banking system has carved a new path to a more accessible digital banking model. Customers can access their accounts, transfer money and pay their bills from home or via their smart devices. This movement towards digital banking has enhanced the customer experience and improved overall business operations. Digital technology has allowed banks to improve security measures and prevent potential fraud cases. Digital technology will continue shaping the future of finance.
Enhancing the customer experience and business operations

Industry transformation is supported by several factors, including improved customer experience, increased efficiency and reduced costs. The rise of fintech businesses and changing demands of customers have played a critical role in driving digital transformation in finance. Furthermore, regulatory changes and tech advancements have made it easier for finance businesses to adopt digital solutions. The increased use of mobile tech and the Internet has also supported further growth in digital banking.

The shift toward digital technology has transformed traditional finance practices. It has enabled new businesses to emerge, offering a range of advantages to the finance world. It has improved the overall customer experience by providing accessible services for all. Digital technology has also increased operational efficiency for finance businesses by creating quicker transactions and reduced costs.

By recognising the advancements, you can make informed decisions about which finance businesses to work with and which technologies to adopt to manage finances effectively.

Navigating the digital finance scene

The digital finance industry is rapidly evolving, and finance companies must remain in touch with the latest trends to stay competitive. Many benefits have emerged with digital tech, but there are also challenges finance companies face when adopting digital solutions. One of the main challenges is related to regulatory compliance. Finance businesses must meet a range of regulations and standards when implementing digital technology to ensure complete security and privacy of customer data. This process can take time and requires considerable resources.
A secondary challenge is legacy systems, with many conventional banks relying on outdated IT systems incompatible with today’s digital solutions. Upgrading these systems can be expensive and time-consuming, blocking the potential adoption of digital technologies.

Cybersecurity is a major concern when implementing digital technology in finance. Businesses must ensure their systems remain secure and protected from potential cyber-attacks. Furthermore, there is a need for skilled talent capable of managing and maintaining new digital solutions. This requires additional investment in training and development plans to ensure employees have the skills to work effectively with new technologies.

Finally, there is a risk of losing the personal connection in finance as more activities move online. Financial institutions must find ways to balance the accessibility of digital banking with personalised customer service to keep customer loyalty. While there are challenges in adding new digital services, finance companies must discover ways to alleviate these concerns to remain competitive in a digital future.

As finance companies slowly transition from physical branches, it will become more important to balance the convenience of digital banking and the personalisation that people demand. While online banking has become very popular, many people still want personal interactions. To address this, emerging technologies like AR and VR may provide solutions to connect the gap between digital accessibility and personalisation. Utilising emerging technologies may enable us to strike a balance, improving customer satisfaction and loyalty. As finance moves closer towards a digital transformation, it’s critical to remember the value of personalisation. Augmented and virtual reality provide a solution to connect digital and personal services. Incorporating these types of services will create an experience that provides customers with more insights into financial products and services.

We are embarking on a new transformation journey and should embrace the power of tech to deliver a promising future for finance. By using digital technologies, banks can transform how they support their customers. Innovation and digital disruption are vital to generating new opportunities and exceeding customer expectations. Finance companies must keep close to emerging trends and provide more convenient and accessible services to their customers and deliver an enhanced finance experience.

UK financial services businesses are believed to need more data skills to succeed in a progressive digital landscape. The lack of data-specific skills for business strategies is hindering UK finance companies’ plans to meet customer demands for more personalised services.

Recent studies by data and analytics business Cynozure suggest there is an overall lack of understanding of the real value of data at the senior level within the UK financial industry. A survey of senior finance executives indicated that 27% of respondents lacked the necessary skills to utilise data properly. Over 30% stated that there was a data skills shortage across their entire business.

One of the main challenges facing the finance industry is determining the return on investment with data investments. Over 50% of people surveyed stated that this represented the main barrier to launching more data plans in their organisation. Jason Foster, the CEO of Cynozure, explained that the study suggested an opportunity for finance companies in the UK to adapt their data strategies and harness the benefits of data. Used in the right manner, data offers a range of benefits in the financial services industry, particularly when many people demand more personalised financial support to alleviate the cost-of-living pressures. Over 90% of respondents agreed that data findings would be critical to supporting customers as the cost-of-living crisis intensifies.

According to a study by open banking tech supplier Tink, over 35% of people struggling financially would consider changing banking providers if they could access custom financial support. None of this will be achievable if the necessary skills aren’t in place to create data-focused solutions.

Conventional banks must improve their use of data if the automation of personalised banking is to progress and compete with other, more digitally-focused tech rivals. Challenger banks are implementing new data strategies, creating personalised financial services for customers. For example, Zopa Bank has created a customer experience that rivals a similar service provided by Netflix or retail giant Amazon. Both businesses depend on sophisticated technology, but the customer portal remains simple and accessible. Implementing machine learning processes has enabled Zopa to create a similar interface used in leading businesses and determine the habits of customers and other users.

The lack of data skills isn’t just a finance industry concern. According to a survey by data consultancy Carruthers and Jackson, 64% of data leaders worldwide believe that nearly all employees in their business lack data experience. The study also indicated that only 1 in 5 people were confident with their data literacy skills, and over 70% felt overwhelmed when working with data.

This year’s outlook has radically changed from predictions a year or so ago. At the end of 2021, executives were focused on the recovery phase from the pandemic and overall confidence in the economy was quite positive. While predictions with rising interest rates, accelerated technology integration and struggling labour markets did occur, the economic outlook for the coming year isn’t as positive as previously anticipated.

Despite stricter financial policies to alleviate economic concerns, many executives still focused on growth. As businesses implement more human-focused management plans, the work environment and company culture, the predominant efforts are integrating technology into business systems and processes. Despite concerns about technology use and costs, digital acceleration, particularly in corporate finance, has risen significantly.

The progression of human resources

With the core of HR transformed by technology, the coming year will inevitably bring more automation and leveraging of data. Automating business processes will be vital for employer and employee relationship for 2023. Simplifying activities is a priority for HR employees. Whether enhancing reliability or expanding the benefits of applying banking as a service (BaaS), CFOs using a people-focused approach must consider what technology is out there to make their work more productive and flexible for their employees.

Leveraging New Technology

Studies have suggested that SaaS products are heavily dependent but often underused and typically very costly. Furthermore, using multiple tools or products to tackle the same problem is a big concern. These problems results from ‘SaaS Sprawl’ caused by the simplicity of implementing and managing software within a business. It often results in a company-wide lack of clarity in the technology stack.
While many leaders recognise the importance of selecting and delivering the right technology, it can be challenging. As fintech continues to transform daily activities in corporate finance, senior leaders should look for the right software for them and their business and not necessarily the most recognised or highest rate tool available.

Enhancing Reliability of Data

The increase in remote and hybrid working and dependence on the cloud has resulted in less reliable and secure data. CFOs must focus on data accuracy and ensuring they can predict, forecast and measure large data sets to ensure continued growth and success.
Nearly half of CFOs in a recent study claimed they lack accurate cash flow data, so utilising technology that makes financial data analysis accessible and easy will be critical in a disruptive economy. As our work conditions continue to change, the generation and management of data are essential. Regardless of industry, CFOs regularly forecast their information, as data reliability can vary. If frequent measuring happens with unreliable data, it impacts the productivity of a CFO and means important decisions and capital allocations are made on inaccurate information.

The Importance of Cybersecurity

Significant cybersecurity breaches have become commonplace in digital environments. Over a third of CFOs reported that cybersecurity is a top priority, and protecting their business, customers, and associated data continues to be of prime importance this year.
Ensuring your business has a response plan is paramount for this year, but having a cyber resilience plan in place will enhance the ability to manage a potential attack and ensure systems remain operational. Recognising the need to manage and plan a cybersecurity strategy is required. With new regulations on data breaches appearing, senior leaders must focus on managing risks that impact growth and take a closer look at their time and investment spent on security measures. Cybersecurity is no longer an optional element of business practice. It is an essential part of the business infrastructure.

As we begin a new year, one of the most highly regarded talent pools will be data scientists, as their particular skill sets will become even more valuable for businesses. 

During 2022, hiring in the tech industry exceeded many other sectors impacted by the transformation preceding the pandemic, the great resignation and a range of economic factors. This year, industry leaders expect to see tech hiring accelerate, especially in data science. With rising dependence on data and technology and new fields emerging, the overall value and demand for data-science-focused roles will increase. Data science hiring is anticipated to dominate this year as more individuals with the skills will explore a lucrative, skills-focused market, and these skills are particularly transferable in other markets like finance, pharma and supply chain. This will create more opportunities for potential candidates and reward them with higher salaries and incentives.

Power to the candidates The data science industry is still progressing as fields like AI and Machine Learning are accelerating. As a result, the meaning of a data scientist is constantly evolving, and businesses need to create teams with new skills. It’s challenging to have lots of experience in areas that are only emerging, especially for senior-level positions. Taking into account the changing roles, finding available talent can be challenging. Technology businesses will continue focusing on securing individuals for their data science roles throughout 2023. The niche skills data scientists have and the existing skill-based market have generated high competition for candidates within the tech scene. This means candidates have the power. 

The other factor giving candidates added ability in the market is that the knowledge and skills in typical roles such as AI, computer science and statistics apply across the board. As a consequence, a data scientist from any discipline can work in fintech, insurance or healthcare, and they can use their skills straight away. This means that as other industries beyond tech begin to apply for data science-related positions, this will create further opportunities for these candidates. 

The tight labour market and the possibility to transfer skills means candidates can negotiate their roles and benefits and seek more flexibility. 

Businesses depend a lot on their data systems, which will likely take a significant step forward throughout this year. As companies apply more technologies and implement them into their business, such as investing in the cloud, this will make data positions far more critical and further developments outside traditional tech positions. 

Data scientists are required for more than just monitoring trends and generating insights because as companies store more information and launch new technologies, it creates more areas of exposure to possible breaches and adds more regulatory issues. Cybercrime has been rising for the last few years, and companies that have ignored investing in data science talent to manage security and privacy face potentially losing significant sums of money. Furthermore, those that fail to invest in security risk management systems, tech and governance controls are unlikely to succeed. 

As a result, organisations will be looking to hire for positions where a data scientist can manage their data across multiple industries such as supply chain, fintech, insurance and financial services. This creates a range of new roles for data scientists and increases the price to acquire them. As other markets compete for this talent, they will focus on the same talent pool but with more competitors. This year we will likely see rising competition and better offers made to secure candidates.

New industries

Emerging markets such as crypto will only increase the value of data scientists as these new industries require data specialists in their companies. Businesses will look to hire data scientists to handle roles in risk management, control and governance as the market continues to become more regulated. The risk and regulation side of the business is typically an area in which many lack tech and data staff, as most have traditionally focused on hiring for growth areas rather than risk.

A high-level data scientist with the skills and experience will be in a strong position. The tech market has shown resilience in hiring top talent, but new opportunities are appearing across other industries, and emerging technologies will generate higher hiring and demand levels. Companies will face stronger competition and need to offer more benefits, flexibility options and compensation packages to secure the best talent.

Predictive analytics is becoming a critical tool for businesses looking to determine the results of key decisions before committing to them. The benefits are evident but implementing the tech can be a challenge. With rising inflation impacting costs and fears of recession affecting demand for services, companies across the country are decreasing their spending and exploring new growth opportunities.

Identifying where, when and how much to invest is critical, but it’s vital during a challenging downturn when choices can have a profound impact on the growth prospects of your business once the economy recovers. In an attempt to adapt their investment plans, companies are increasingly applying predictive analytics to support them in assessing opportunities and risks. 

James Petter, VP of data storage business Pure Storage, believes risk management is a major discussion point among CFOs and regulatory teams, especially in the current economic climate. Senior leaders consider risk management a top priority, assessing their economics, financial structures and technologies. Businesses contain lots of data, and most are trying to determine how to use this information. Often, companies are focused on the current market conditions and responding to these but moving forward, there is likely to be more of a push on looking ahead, and predictive analytics will play a significant part in this. The rise of predictive analytics is no surprise to Shankar Balakrishnan, VP for Europe at Anaplan. Balakrishnan refers to businesses using historical data to navigate challenging times as someone driving by only using their rear-view mirror. Balakrishnan believes companies must utilise more data on potential outcomes and react smarter to possible disruption. Anaplan recently partnered with the South Central Ambulance Service Foundation NHS Trust to support its predictive potential. By applying machine learning and predictive insights to their data, Anaplan determined the number of emergency call the ambulance teams would receive at any given time. This process allowed the trust to deliver resources more efficiently. 

The challenge of implementing predictive analytics 

For finance leaders, the challenge is understanding what to focus on. One initial area to work on is automating functions in the back office. Applying technology, such as robotic process automation and AI-focused data analytics, improves the processes, tackles skills gaps and improves efficiency. It can also provide intelligence that can support forecasting and planning. Automation like this allows employees to focus more on value-added tasks.

Bearing in mind the potential risk and uncertainties, few leaders will want to make critical investments and resourcing plans on instinct. Risk management may be a priority in a crisis, but can business leaders avoid this crisis in the first place? Whether it’s a pandemic or cyber attack, making effective plans under pressure requires accurate and data-focused insights. Successful risk management needs data to deliver various scenarios and options. For example, in the travel and tourism industry, predictive analytics may prove critical to enable them to recover from significant disruption experienced after Covid. Aircraft manufacturers are using technology to find the best times to perform maintenance tasks, and airlines are using similar technologies to predict demand for flights and plan their staffing and fuelling requirements. Quality data and predictive analytics are critical to risk mitigation within the finance industry. They are vital for fraud detection, auditing and other types of advanced work.

The overall success of this technology depends on the quality of data fed into the system. Insights created on incomplete inputs could be misleading and potentially cause harm to a business. Implementing predictive analytics isn’t a one-time process. It takes time and effort to examine the findings, understand them and alter the system accordingly. It’s important to have clear goals when implementing analytics, adapt them when necessary and continuously revisit them to ensure the business is getting what it needs. Accuracy and compatibility are critical when measuring performance across various teams.

If leaders work with inaccurate data, they risk making inaccurate decisions. Similarly, if teams spend hours validating data, it makes the entire process impossible for decision-makers to react quickly. Despite the challenges, the benefits of predictive analytics are clear. With the insights it delivers, predictive analytics offers significant value for business leaders, converting data into critical information for a business.

With rising demand for managing the impacts of climate change, finance-related businesses are experiencing new challenges. Deloitte is partnering with Persefoni to launch a new integrated service that measures climate exposure, meets new regulations and delivers more informed data-focused decisions.

Persefoni, a climate management and accounting platform (CMAP) provide businesses, financial companies and government agencies with the software required for managing climate-related data and business performance with the same level of confidence as their financial reporting system. The software solutions will allow users to calculate their carbon footprint, perform climate modelling aligned to temperature rise scenarios and benchmark their impact by location, sector and other groups.

As Deloitte continues to focus on supporting clients on their path to net zero, it has formed a strong partnership with Persefoni. The collaboration will see the companies develop analytical solutions for the finance industry, supporting businesses to find a new path for measuring, disclosing and managing their carbon footprints, from an operational and financial perspective as part of their climate journey.

Ricardo Martinex, the sustainability, climate and equity leader at Deloitte Risk and Finance, explains that by leveraging rich data in the Persefoni platform combined with Deloitte’s analytics and services, they can support businesses through their end-to-end ESG transformation. As finance-related companies focus on carbon accounting requirements, recognising and evolving the financed emissions in their portfolios will enable clients to chart financed emissions, explore critical business risks and find opportunities to improve the structure of their financed portfolio, as well as meet all reporting obligations.

As leaders of sustainability and finance combine to tackle CMAP requirements, Persefoni and Deloitte’s clients can apply Persefoni’s tools and Deloitte’s experience with ESG practices and financial analytics to address sustainability and climate goals. The partnership has seen Deloitte create and integrate accelerators, analytics and other tools to support clients in the finance industry, and understand risks and opportunities based on financed emissions portfolio data.

The financial services industry faces rising pressure from governments, regulators and capital markets and is moving towards disclosing operational and financed emissions footprint. As finance companies work toward their net zero targets and improve their impact on the climate, creating a structured CMAP use will be vital, especially as ESG disclosures become regulated.

Kentaro Kawamori, CEO and Co-Founder of Persefoni, explains that Persefoni is excited to partner with Deloitte, a leader in sustainability, climate and equity strategy and advisor to many leading businesses and financial institutions. Supported by Perseoni’s technology platform and Deloitte’s sustainability, risk and reporting services, their clients in finance will have access to the best support on their climate journeys, from meeting compliance requirements to measuring climate exposure within their portfolios and enhancing their business strategies.