The life of a leader Six influential leaders in business and politics share their stories - Accounting Technicians Ireland

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The life of a leader Six influential leaders in business and politics share their stories - Accounting Technicians Ireland
Volume 52
                                                        Number 2
                                                        APRIL 2020

                           The life of a leader
                                    Six influential leaders in business
                                      and politics share their stories

  GOOD GOVERNANCE              COMBATING                A GUIDE TO
      IN A CRISIS              CYBER RISK           REMOTE WORKING
 How to manage your       Why cyber behaviour      How to make remote
governance obligations   in organisations is the   working work for an
   through COVID-19         board’s business         extended period
The life of a leader Six influential leaders in business and politics share their stories - Accounting Technicians Ireland
Recruitment
    beyond
    accounting.
    Chartered Accountants transcend industries and
    functions. So do we, with our intelligent approach
    to recruitment.

    • Accounting & Finance          • Funds & Asset Management
    • Banking                       • HR
    • Construction                  • Office Support
    • Emerging Tech                 • Legal & Compliance
    • Food Manufacturing            • Property

azon.ie                      Dublin | Limerick | London | Luxembourg
The life of a leader Six influential leaders in business and politics share their stories - Accounting Technicians Ireland
3
                                                                                                     Welcome

Welcome to the April issue
of Accountancy Ireland.
                                                                   if managed correctly, Ireland’s reputation as an open,
                                                                   adaptable yet stable economy also presents opportunities.

                                                                   Engagement with US members and politicians
                                                                   At the time of writing, the Institute’s Director of Advocacy
                                                                   & Voice, Dr Brian Keegan, and myself are currently
                                                                   meeting with members and politicians in the USA.
                                                                      The programme has involved meetings in New York
                                                                   with Northern Ireland Economy Minister, Diane Dodds,
                                                                   and Consul General of Ireland, Ciarán Madden, before
                                                                   moving on to Washington DC for various events including
                                                                   the Irish Business Leaders’ Lunch, the Irish Funds dinner
                                                                   and the NI Bureau breakfast.
                                                                      Throughout the visit, we have had a very warm
                                                                   welcome from members based in the US and some really
                                                                   useful engagement with political representatives from

A
         t the time of writing, efforts to contain the spread      both sides of the Atlantic.
         of coronavirus are undoubtedly the focus of
         attention for society and business across the             Institute signs climate change pledge
island. This is a very serious and fast-evolving situation,        In February, our Institute announced that it is one of 14
and Chartered Accountants Ireland will adhere to the               accounting bodies worldwide to become signatories to a
official advice provided by our respective health services         call to action on climate change issued by Accounting for
and governments. The safety and health of our members,             Sustainability (A4S).
students and staff are paramount, and that principle                  The memorandum of understanding signed by Chartered
guides the decisions taken.                                        Accountants Ireland states that signatories will commit to
   The Institute is reviewing its programme of                     providing the training and infrastructure that accountants
activities in respect of members, students and external            need, as well as supporting initiatives and providing the
stakeholders. We will be in contact with everyone                  necessary evidence to take action on climate change.
concerned to advise them of all decisions made.                       In signing the memorandum, Chartered Accountants
   I would like to take this opportunity to commend                Ireland recognises that climate change is an economic,
businesses across the island for their responsible attitude        social and business risk and that accountants must take
to their employees and customers in following official             action collectively as a profession and individually as
guidelines. Such decisive action will, we hope, effectively        professionals working in the public interest.
curtail the spread of the virus.                                      The 14 accounting bodies signed up to the agreement
                                                                   represent a total of 2.5 million accountants and students
Paschal Donohoe T.D.                                               worldwide.
At the start of March, we were honoured to host Minister
for Finance, Public Expenditure and Reform, Paschal                Annual Dinner
Donohoe T.D., who addressed an invited audience of                 Finally, this is my first comment section since our Annual
Institute members and guests.                                      Dinner at the end of January. I would like to record my
    Inevitably, coronavirus featured prominently with              thanks to the 900 guests who supported the event; to
the Minister predicting that the Irish economy would               our event partners Dublin Airport, Bank of Ireland,
be impacted by the global slowdown associated with the             PeopleSource and Toyota; to our special guest, Lochlann
outbreak. He said: “Many, including the OECD, outline that         Quinn FCA; and, most particularly, to the many corporates
this outbreak has the potential to slow global growth to           who supported the event by hosting tables. For me, it
its lowest rate since the financial crisis just over a decade      was another great demonstration of how Chartered
ago. To what extent, it is too early to say, but it follows that   Accountants are at the heart of our economy, driving Irish
weaker growth will affect our short-term outlook and my            business.
department will update its projects in April”.
    Turning to Brexit, the Minister argued that while the          Conall O’Halloran
post-Brexit world will present significant challenges,             President

                                                                                                     www.accountancyireland.ie
The life of a leader Six influential leaders in business and politics share their stories - Accounting Technicians Ireland
4

Contents
    Publisher
    Institute of Chartered Accountants in Ireland
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    Telephone: (01) 637 7241
                                                                Interview
    Website: www.accountancyireland.ie
                                                                Joan Curry discusses her varied
    Subscription rate
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                                                                                       16 Gallery
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                                                                                       83 Membership
                                                                                       84 Regulation
                                                                                       86 Commercial
                                                                                           features

Accountancy Ireland | April 2020
The life of a leader Six influential leaders in business and politics share their stories - Accounting Technicians Ireland
CONTENTS                5

Features                         66                         63
38  Innovations in third-level
    accounting education
42 The changing face of your
    profit and loss account
46 The 2019 Partnership
    Regulations
50 Selling your business
55 Not all talk is cheap
58 Why cyber behaviour is the
    board’s business
60 Unleash your data
    analytics capability
63 How to make remote
    working… work                Careers                    Spotlight
64 Developing a framework
    for climate-related risk     92   Use the 80/20         32   Senan Murphy, CRH
66 Another new dawn for               principle to find a   33   Michael Cawley,
    gender pay gap reporting?         job you love               Ryanair
70 Get to grips with the         95   The power of three    34   Ronan Dunne, Verizon
    revised Institute Code of         good things           35   Sharon Cunningham,
    Ethics                       97   On the move                Shorla Pharma
73 How to manage your            98   Accountant sinks      36   Michael McGrath T.D.,
   governance obligations             teeth into dental          Fianna Fáil
   through COVID-19                   market                37   Fergal O’Dwyer, DCC

                                                            Tax
                                                            74   Turbulent times for
                                                                 tax receipts?
                                                            76   Capital allowances
                                                                 for structures and
                                                                 buildings
                                                            78   VAT matters

                                                  78        80   Tax deadlines

                                                                     www.accountancyireland.ie
The life of a leader Six influential leaders in business and politics share their stories - Accounting Technicians Ireland
6         CONTRIBUTORS

    1.                                             Our contributors

                                                          1. Eimear McGrath
                                                  Eimear McGrath is Associate Director at the
                                                 Department of Professional Practice in KPMG.
                                                In her article, Eimear explores some of the key
                                                  impacts of the European Union (Qualifying
                                              Partnerships: Accounting and Auditing) Regulations
                                                 2019 and asks to what extent they will widen
                                               the financial reporting and filing obligations for
                                   2.                             partnerships.

                                                          2. Ted Webb and
                                                         Raymond Donegan
                                                 Raymond Donegan is Director and Head of Family
                                                Businesses at IBI Corporate Finance, and Ted Webb
                                                FCA is Managing Director at IBI Corporate Finance.
                                               In their article, Raymond and Ted outline a four-step
                                               process that, if followed, will maximise the potential

                                         3.   for a successful sale of your, or your client’s, business.

                                                            3. Sarah Hipkin
                                                  Sarah Hipkin is Director, Data Protection, at
                                                Mazars Ireland. In her article, Sarah argues that
                                              organisations must develop a cyber strategy and
                                               culture that considers the human element if they
     4.                                       are to minimise the associated financial, legal and
                                               reputational consequences of potential security
                                                                   breaches.

                                                            4. Aoife Newton
                                                Aoife Newton is Head of Corporate Immigration
                                                and Employment Law at KPMG Ireland. While the
                                                outgoing Government made limited progress in
                                               introducing gender pay gap reporting legislation
                                                  in the Republic of Ireland, Aoife notes that it
                                               remains to be seen whether the next government
                                        5.              will echo the same commitment.

                                                           5. Eugene Moore
                                               Eugene Moore, Corporate Tax Manager at BDO
                                              Northern Ireland, looks at the UK’s Structures and
     6.                       6.               Buildings Allowance (SBA). With some projects
                                               coming into use, it is time for owners and their
                                                advisors to consider the significant tax relief
                                               available and how best to mitigate the risks of
                                                           making an invalid claim.

                                                               6. Orla Doyle
                                                    Orla Doyle, Head of Marketing at Lincoln
                                               Recruitment Specialists, explains how Chartered
                                              Accountants can harness the benefits of the 80/20
                                              rule in their job search strategy to target the right
                                              company, the right culture, the right management
                                                team, and help secure the job of their dreams.

Accountancy Ireland | April 2020
The life of a leader Six influential leaders in business and politics share their stories - Accounting Technicians Ireland
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The life of a leader Six influential leaders in business and politics share their stories - Accounting Technicians Ireland
NEWS           9

This is the second
award Mairéad has
won in recent months.
                                       News in brief

Mazars Partner,
Mairéad Divilly,                        Helena O’Dwyer, Head of wavespace at EY and Frank O’Dea, Chief Innovation Officer at EY.

scoops Irish                           EY launches wavespace client
Women’s Award
                                       innovation centre in Dublin
M
          airéad Divilly, Lead
          Outsourcing Partner at       EY launched its new EY wavespace centre in Dublin, expanding its global
          Mazars, won the Services     network of innovation centres that bring EY technology and business experts
to Accounting & Finance category       together with clients to achieve business transformation. EY wavespace
at the second Irish Women’s            provides facilitated sessions to its clients in Ireland that use design thinking
Awards 2020, which took place          methodologies and deep expertise across sectors and technologies.
at the Blanchardstown Crowne              The firm anticipates that 20% of EY employees will work in technology-
Plaza Hotel in Dublin recently.        focused roles by 2022 and has set a target that 25% of its graduate recruits
   This is the second award            come from STEM backgrounds in the same period. This is in addition to the
Mairéad has won in recent              investment of more than $530 million globally in upskilling all EY staff in future-
months. In September, she              focused skills, including emerging technology.
received Skillnet Ireland’s award
for outstanding contributions
at their 20th Anniversary Gala
Dinner Celebration.
                                       IASB reviews accounting for goodwill

                                       T
   A Fellow of Chartered                     he IASB recently published for                     The IASB’s preliminary view is
Accountants Ireland, Mairéad                 public comment discussion                       that there is no compelling evidence
provides support for companies               paper DP/2020/1 on Business                     to justify changing accounting
in payroll, HR, tax compliance,        Combinations – Disclosures,                           for goodwill and the costs that
accounting, audit and advisory         Goodwill and Impairment.                              such a change would entail.
services and specialises in            Comments can be submitted to the                      This discussion paper provides
compliance for corporates              IASB until 15 September 2020.                         stakeholders with an opportunity
establishing operations both              The IASB’s preliminary                             to explain whether they agree with
in Ireland and other overseas          view is that it should retain the                     that preliminary view.
jurisdictions.                         impairment-only approach to                              The proposals result from the
   Mairéad is a non-executive          accounting for goodwill and develop                   IASB’s post-implementation review
director of Skillnet Ireland and       proposals to improve disclosures                      of IFRS 3 Business Combinations
represents the interest of the Small   about acquisitions. The IASB accepts                  (report and feedback statement
Firms Association on the Skillnet      that both the impairment-only and                     published June 2015).
Ireland Board. She also leads the      amortisation models for accounting                       The discussion paper is available
CSR strategy at Mazars Ireland.        for goodwill have limitations.                        on the IASB’s website, www.ifrs.org

                                                                                                              www.accountancyireland.ie
The life of a leader Six influential leaders in business and politics share their stories - Accounting Technicians Ireland
10

Crowe presents fundraising                                                                                           This is a testing time
   cheque to LauraLynn                                                                                               for the local economy

                                                                                                                     Leading Chartered
                                                                                                                     Accountant says
                                                                                                                     executive must win
Pictured (from left) are: Claire Shiels, Corporate Fundraiser, LauraLynn with Patrick Foley and Paul Lynch, Crowe.   back confidence
                                                                                                                     with reform
C
       rowe employees recently presented a cheque for over €10,000 to the firm’s 2019

                                                                                                                     T
       charity partner, LauraLynn.                                                                                           he Chairman of Chartered
         Crowe staff participated in a range of fundraising and volunteering                                                 Accountants Ireland Ulster
initiatives throughout 2019 to help support LauraLynn’s children’s hospice and all the                                       Society has called on the
incredible work they do to help support children with life-limiting conditions and                                   Northern Ireland Executive to
their families in Ireland.                                                                                           implement “much needed reform”
                                                                                                                     in the health and education
                                                                                                                     sectors and to re-energise the
   Government announces supports for                                                                                 local economy.

   businesses impacted by COVID-19                                                                                      Speaking to over 360 guests
                                                                                                                     at the Ulster Society’s Annual
   The Minister for Business, Enterprise                       for vulnerable but viable firms that                  Dinner, sponsored by Danske
   and Innovation, Heather Humphreys                           need to restructure or transform                      Bank and MCS Group, Richard
   T.D., has announced a package of                            their business.                                       Gillan called on the Executive
   supports for businesses impacted by                     •   The maximum loan available                            to provide investment in
   COVID-19. Supports include:                                 from MicroFinance Ireland will be                     infrastructure and skills; and to
                                                               increased from €25,000 to €50,000                     adopt a business-friendly strategy.
   • A €200 million Strategic Banking                          as an immediate measure to                               Richard said: “This is a
       Corporation of Ireland (SBCI)                           specifically deal with exceptional                    testing time for the local
       Working Capital scheme for eligible                     circumstances that micro-                             economy. Factors such as Brexit
       businesses impacted by COVID-19.                        enterprises – (sole traders and firms                 and cutbacks in Government
       Loans of up to €1.5 million will be                     with up to nine employees) – are                      spending will be challenging, but
       available at reduced rates, with up                     facing. Applications can be made                      our members see the restoration
       to the first €500,000 unsecured.                        through the MFI website or through                    of the Northern Ireland Executive
       Applications can be made through                        your local enterprise office (LEO).                   as a very positive move. Whilst
       the SBCI website.                                   •   The Credit Guarantee Scheme will be                   the restoration is most welcome,
   •   A €200 million package for                              available to COVID-19 impacted firms                  the last three years have left us
       enterprise supports including a                         through the Pillar Banks. Loans of                    with a lot of catching-up to do,
       Rescue and Restructuring Scheme                         up to €1 million will be available at                 and the Executive needs to prove
       available through Enterprise Ireland                    terms of up to seven years.                           itself and show that it can deliver
                                                                                                                     for the wider economy.”

Accountancy Ireland | April 2020
NEWS             11

                                                                                                                It pays to pay
                                                                                                                women the same

                                                                                                                C
                                                                                                                      losing the gender pay gap
                                                                                                                      across the OECD could
                                                                                                                      boost female earnings by
                                                                                                                over 21%, which translates to
                                                                                                                over US$2 trillion, according
                                                                                                                to PwC’s latest Women in Work
                                                                                                                Index, which analyses female
                                                                                                                economic empowerment across
                                                                                                                33 OECD countries. Furthermore,
                                                                                                                if the female employment rate
                                                                                                                across the OECD matched that
                                                                                                                of Sweden, OECD GDP could be
                                                                                                                boosted by over US$6 trillion
                                                                                                                according to this latest index.
 Pictured (from left) are: William McCulla, Invest NI; Judith Hartley, British Business Bank; Richard Gillan,      The Women in Work Index
 Chair, Chartered Accountants Ireland Ulster Society; and Shane O’Hanlon, InterTradeIreland.                    is a weighted average of five
                                                                                                                indicators that reflect female

Helping SMEs fund
                                                                                                                participation in the labour
                                                                                                                market and equality in the
                                                                                                                workplace: the gender pay gap,

future growth
                                                                                                                female labour force participation,
                                                                                                                the gap between male and
                                                                                                                female labour force participation,
                                                                                                                female unemployment and the

A
        n event examining the funding landscape for local small- and medium-sized                               female full-time employment
        enterprises (SMEs) took place in Belfast recently.                                                      rate.
           The ‘Access to Finance’ event, organised by Chartered Accountants Ireland                               This year’s index has Iceland
Ulster Society in partnership with Invest Northern Ireland, InterTradeIreland and                               and Sweden retaining their
                                                                                                                top two positions for the fifth
British Business Bank, brought Northern Ireland business leaders and advisers
                                                                                                                year in a row, with Slovenia in
together to discuss the range of funding options available.
                                                                                                                third place. Although the UK
   Richard Gillan, Chair of Chartered Accountants Ireland Ulster Society said: “It’s                            performed above the OECD
important that businesses and their advisers are not only familiar with the more                                average and is second only to
traditional finance options on offer, but also with the alternative funding solutions                           Canada when compared to other
available to growing businesses.                                                                                G7 economies, its position has
   “Alternative sources of finance, offered across both debt and equity markets, are                            barely budged since 2000 when
now more prevalent in the funding landscape and have a key role to play in allowing                             it stood at 17th position, despite
businesses to effectively execute their growth strategy.”                                                       improving its performance
                                                                                                                across all five indicators.
                                                                                                                   Ireland recorded the biggest
                                                                                                                decline (along with Estonia) in
Irish companies eye international expansion                                                                     the PwC Women in Work Index
                                                                                                                rankings this year, falling by four
and new service lines despite challenges                                                                        positions. Analysis attributes
                                                                                                                this largely to a widening of the

F
      inding, hiring and retaining top talent remains the most significant challenge                            gender pay gap.
      facing Irish businesses, according to a survey of the 2020 Deloitte Best Managed
      Companies network. Representatives from almost 100 companies provided
their views on the key advantages and challenges facing them in 2020 and on their
                                                                                                                      Closing the gender
ambitions for growth in the years to come.                                                                            pay gap across the
   Talent acquisition was noted by 57% as their organisations’ biggest challenge,                                     OECD could boost

                                                                                                                          21%
remaining the top challenge when compared to the 2019 results. Geopolitical                                            female earnings
uncertainty (44%, up from 37% last year) and the development of new products and
                                                                                                                by over

services (22%) were the next-highest-rated challenges.
   Asked to rate the three most significant factors that give a key advantage in their
marketplace, the companies identified excellent customer relationships (54%), unique
products/services (46%) and their commitment to continuous improvement (43%) as                                 which translates to over
the highest contributors. A good business strategy also rated highly at 32%. Notably,
‘lower cost than our competitors’ was the lowest-rated factor at 2%.                                            US$2 trillion
                                                                                                                           www.accountancyireland.ie
12        NEWS

                                         Pictured (from left) are Sonya Boyce, Director of HR Consulting in Mazars; Fergal Brosnan, Head of Strategy
                                         Development at Bank of Ireland; and Helen Downes, CEO at Shannon Chamber.

  Credit Review
  Office rebrand
                                        Gender pay gap
  takes effect                          reporting is fast approaching
                                        W
  The Credit Review Office has                     ith the Gender Pay Gap Information Bill, 2019 currently in the process of
  rebranded to be known as ‘Credit                 being enacted, companies need to pay more attention to the pay gaps that
  Review’. First established in 2010               exist between men and women in their organisations. This was the stark
  by the Minister for Finance,          message that Sonya Boyce, Director of HR Consulting in Mazars, gave to a gathering
  Credit Review’s role is to ensure     of Shannon Chamber member companies at a recent seminar in Shannon.
  the flow of credit to viable small-      Given that Ireland witnessed a 2% increase in its gender pay gap from 12% to 14%
  and medium-sized enterprises          between 2014 and 2017; that this figure is above the European average of 16% and will
  (SMEs) and farming businesses.        continue to grow without legislative intervention; that only 19% of chief executive
    Credit Review provides an           positions in Ireland are held by women; and that women represent only 13% of
  independent and affordable            boards of management for Irish listed companies, the issue that companies need to
  appeals process for SME and           be concerned about is ‘when’, not ‘will’, mandatory pay gap reporting come into effect
  farm businesses who have either       in Ireland.
  been refused credit or have              By year three of its initiation, reporting will be mandatory for companies of all
  had existing facilities up to a       sizes in Ireland with larger companies required to report in the initial two years.
  value of €3 million reduced or        “Now is the time to start preparing,” added Sonya.
  withdrawn.
    Credit Review appeals are
  successful in 90% of the cases it
  supports, with the majority of        IFAC outlines five factors for high-quality audit

                                        A
  cases handled for a fee of €100.              s audit reviews unfold in                        consistent high quality,” said IFAC CEO,
  Larger value cases are charged                various national jurisdictions,                  Kevin Dancey. “This, however, cannot be
  more, up to a maximum of €250.                the International Federation                     achieved in a vacuum – all participants
                                        of Accountants (IFAC) has set out                        in the audit and assurance ecosystem
                                        its recommendations for achieving                        must work together in striving to achieve
        Credit Review                   high-quality audits. Its five essential                  high-quality audits 100% of the time. It
         appeals are                    factors are: the right process, the right                is a vital part of our profession’s public
        successful in

     90%
                                        people, the right governance, the right                  interest mandate.”
                                        regulation, and the right measurement.                       He continued: “We call on regulators
                                            “Audits contribute meaningfully                      and PAOs (professional accountancy
                                        to the functioning of organisations,                     organisations) to collect, analyse, and
                                        financial markets, and economies.                        publish more and better data – both
         of the cases it                While many thousands of audits are                       aggregate and granular – on audit quality,
           supports                     conducted each year without any issues,                  with the goal of enhancing transparency
                                        improvements are needed to ensure                        and promoting higher audit quality.”

Accountancy Ireland | April 2020
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14

News from your Institute
                                             Akriti Gupta reviews the Institute’s recent
                                                policy and representations activity.

                                            Pictured (from left) are: Conall O’Halloran, President at Chartered Accountants
                                            Ireland; Minister Diane Dodds, Northern Ireland Economy Minister; and Dr Brian
                                            Keegan, Director, Advocacy and Voice at Chartered Accountants Ireland.

                                            Minister Dodds addresses members
                                            at Institute event in New York

                                            N
                                                    orthern Ireland’s Minister                   her commitment to delivering
                                                    for the Department of the                    business growth and increased
                                                    Economy, Diane Dodds,                        investment into Northern Ireland.
                                            addressed members at an Institute                      Echoing the Minister’s sentiments,
                                            event in New York.                                   Conall O’Halloran, President of
                                              Speaking at the event, the Minister                Chartered Accountants Ireland,
                                            said she recognised the key role of                  reiterated the Institute’s commitment
                                            members of Chartered Accountants                     to the all-island economy and
                                            Ireland in attracting investment to                  noted the particular value of the
                                            Northern Ireland, and its strong and                 accountancy skillset in contributing
                                            influential network. She also reiterated             to business development.

Brexit: what does it mean
for our members?                            Minister Paschal Donohoe T.D.
The Institute published a special episode   addresses members in Q&A session

                                                                                           M
of the Accountancy Ireland podcast,
                                                                                                     inister for Finance and Public
where Aidan Lambe, Akriti Gupta,
                                                                                                     Expenditure and Reform,
Ronan O’Loughlin and Zara Duffy spoke
                                                                                                     Paschal Donohoe T.D.,
about what Brexit and the ongoing
                                                                                            addressed Institute members and guests
transition period means for members
                                                                                            in March.
of Chartered Accountants Ireland. The
                                                                                               His address, titled The Irish Economy
panel also discussed the future of
                                                                                            at a Crossroads: Risks and Opportunities
audit and what the Institute can do for
                                                                                            Ahead, covered the potential global
its members. Meanwhile, Chartered
                                                                                            economic slowdown from COVID-19, the
Accountants Ireland published a series      Pictured (from left) are: Barry Dempsey,
                                            CEO at Chartered Accountants Ireland;           outgoing Government’s fiscal policy, the
of explainers on the Brexit timeline and    Conall O’Halloran, President at Chartered       requirement for an exchequer surplus,
the negotiation mandates.                   Accountants Ireland; and Paschal Donohoe
                                            T.D., Minister for Finance and Public           and the ongoing negotiations to form a
                                            Expenditure and Reform.                         new government.

Accountancy Ireland | April 2020
NEWS             15

                                                                                                   Responding to consultations
                                                                                                   The Institute has provided responses to a
                                                                                                   number of consultations recently.
                                                                                                   Under the auspices of CCAB-I, the Institute
                                                                                                   responded to the OECD Secretariat
                                                                                                   Unified Approach Proposal under Pillar
                                                                                                   One to taxing the digital economy; the
                                                                                                   OECD Secretariat GloBE Proposal under
                                                                                                   Pillar Two to taxing the digital economy;
                                                                                                   and Revenue’s real-time Dividend
                                                                                                   Withholding Tax (DWT) proposal.
                                                                                                      We also responded to the Department
                                                                                                   of Communications, Climate Action and
                                                                                                   Environment consultation on a “proposed
                                                                                                   increase to environmental levies”.

London Society rises to the
challenge of climate change                                                                        Institute signs MOU with HMRC
                                                                                                   The Institute has agreed a memorandum

T
       he Institute in conjunction with the London Society hosted a panel event                    of understanding (MOU) with HMRC,
       for members living and working in London at the Embassy of Ireland                          which is now being used to shape future
       in London. Moderated by Dr Brian Keegan, the theme of the event was                         reporting by HMRC to Professional
                                                                                                   Standards of instances of potential
‘sustainable finance – the cornerstone to better business’, and the event saw
                                                                                                   misconduct by our members.
excellent engagement and discussion. London Society Chair, Peter Keenan-
                                                                                                     The MOU contains a number of
Gavaghan, said: “Sustainable finance is an area where our profession has to be                     safeguards that mirror those available
ready to take the lead.”                                                                           to our members in instances where the
The panel for the evening was Richard Spencer, Head of Sustainability at ICAEW; Hannah Armitage,
Project Manager at the Financial Reporting Council; Elaine Deehan, Country Manager of Ireland      Revenue Commissioners wish to make a
at Starling Bank International; and Patrycja Jurkowska, Chartered Accountants Ireland Young        report to Professional Standards.
Chartered Star 2019. Also, in attendance were Economic Counsellor, Páraig Hennessy, and his
colleagues from the Department of Foreign Affairs and Trade.

                                                                                                   CCAB-I identified as fifth
                                               Chartered Accountants                               most active lobbying group in
    Institute signs                                                                                Ireland
                                               Ireland inaugurates new                             The second statutory review of the
    call to action on                          Vancouver Chapter                                   Regulation of Lobbying Act 2015
    climate change                                                                                 identified the Consultative Committee of
    Chartered Accountants                                                                          Accounting Bodies Ireland (CCAB-I) as one
    Ireland recently became                                                                        of the top five organisations in Ireland
    one of 14 accounting bodies                                                                    with the greatest amount of lobbying
    to sign a call to action on                                                                    activity.
    climate change. The call                                                                         This was from a total of more than
                                                                                                   40,000 returns, which had been submitted
    was issued by Accounting
                                                                                                   as at 21 January 2020 from over 1,900

                                               T
    for Sustainability (A4S),
                                                     he Institute inaugurated the                  persons and organisations listed on the
    a project promoting                                                                            Register.
    sustainability in business.                      new Vancouver Chapter on 24
    The accountancy                                  February 2020, by hosting an
                                               evening member networking event in
    profession plays a vital                                                                       UK Budget 2020 – top
                                               KPMG’s offices in Vancouver, Canada.
    role in achieving climate                                                                      takeaways
    change mitigation and                        Director for Advocacy and Voice, Dr
                                                                                                   The Institute published its analysis of
    adaptation. The CEOs of                    Brian Keegan, updated the group on
                                                                                                   the newly appointed Chancellor of the
    the signatory accounting                   the current Brexit position and the
                                                                                                   Exchequer, Rishi Sunak’s first Budget and
    bodies are committing to                   opportunities and challenges that
                                                                                                   the first UK Budget in over 16 months. It
    support accountants in                     come with it. Irish Consul General to
                                                                                                   came just weeks after the UK’s departure
    taking urgent action by                    Vancouver, Frank Flood, addressed the
                                                                                                   from the EU and amidst the COVID-19
    providing the training                     gathering and highlighted the Institute’s
                                                                                                   outbreak, with many seeing the Budget
    and infrastructure that                    strategic position as a key business
                                                                                                   as an opportunity to vaccinate the UK
    accountants need, as well as               entity and financial services expert in
                                                                                                   economy.
    by supporting market-based                 the business community in Canada.
                                                                                                      The analysis touched on points such
    initiatives and providing                    The evening was a great success                   as VAT-postponed accounting, pensions,
    the evidence base needed to                and saw many local members coming                   personal tax, and business tax measures.
    take action.                               together for an evening of networking
                                               and discussion.

                                                                                                                     www.accountancyireland.ie
16

                                               Professor Patricia Barker and
                                               Past-President Shauna Greely

Lena Hennessy and Professor Niamh Brennan

                                                         International
                                                         Women’s Day
                                                             2020
                                                   80 Chartered Accountants and guests
                                                    gathered in Chartered Accountants
                                                   House, Dublin for the first International
                                                    Women’s Day lunch on 9 March 2020.
Derek Reilly

Shauna Greely and Professor Patricia Barker    Barry Dempsey speaks to guests   Paula Houlihan

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Accountancy Ireland | April 2020
GALLERY            17

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   Caroline McGroary                                   Anna Maria O’Shea                                       Amy Ball

                                                                                                               Lena Hennessey and other guests
   Michelle Maxwell and Amy Ball                       Barry Dempsey and Paula Nyland                          engage in a networking exercise

   Dearbhla Brennan, Cody Jackson and Sarah Lane                           Professor Patricia Barker               Michelle Maxwell

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COMMENT                 19

   Thanks for the memories?
             Some of the commercial habits that are already being
                formed could serve us well once the COVID-19
                    crisis is over, writes Dr Brian Keegan.
                                          and economic impact was far less            online training. This could be down
                                          pronounced than that of the current         to a desire to fill empty hours, or
                                          scourge, but I’m not sure the reason        more positively, it could be down to a
                                          is as straightforward as that. It may       broader recognition that additional
                                          instead be because they left no lasting     skills and tools are needed for future
                                          behavioural changes in most of the          survival.
                                          businesses and societies they affected.        Behaviour is the hardest
                                             Societies that did remember how          thing to change. The reluctance
                                          bad things could get were better            to lend or borrow, an antipathy
                                          prepared for COVID-19. Singapore is         towards speculative development,
                                          not the most open of jurisdictions,         overcautious economic policy and
                                          but they read the warning signs early.      even the rise of the gig economy can
                                          Also the isolation wards built there to     be traced back to the downturn a
                                          tackle SARS in the early years of the       decade ago. The legacy of the 2007/08
                                          century were still available to hold        recession sometimes lingers less on

B
        y now, all businesses and         patients ill with COVID-19, and that        balance sheets than it does in the
        institutions have taken some      in turn allowed the authorities to be       collective memory.
        preventative and containment      more prescriptive about quarantining           The businesses that bounce back
measures against COVID-19 for their       and testing.                                the fastest could well be those who
staff, but the early adopters of social      No business, nor even a country,         are the early adopters of the new
distancing won headlines and even         can (or even should) sustain the kind       business behaviours prompted by
kudos for so doing. They were the         of “ just in case” procedures, buffers      the crisis. Just like the last recession,
first to tell personnel to work from      and Singaporean-style infrastructure        COVID-19 is now creating memories
home, to block staff from hosting or      to guard against once-in-a-century          of its own. We will need to hang on to
attending large meetings or any type      pandemics. This, however, is a crisis       the positive ones.
of gathering, and to have placed an       for all of us, and we should not waste
embargo on international travel.          an opportunity to take some insight
   Those early adopters had much          from it.
in common. Typically they were               Some of the commercial habits that
large, multinational, and flourished      are already being formed could serve        Behaviour is the
in the online sales and services          us well once this crisis is over. Because
environment. By contrast, the             the situation is changing daily, I
                                                                                      hardest thing to
indigenous SME sector often operates      am hesitant to be too prescriptive          change. The reluctance
within a market segment where             and not all these behaviours will           to lend or borrow, an
having people work from home is           sustain or improve the bottom line.         antipathy towards
not practicable. The sector is now        Nevertheless, there is already evidence     speculative development,
suffering the most from the collapse      that businesses are accommodating,          overcautious economic
in demand caused by the pandemic.         and staff are delivering through, more
   We have seen epidemics before,         flexible working practices. This is not
                                                                                      policy and even the rise
but how well did we remember the          just about working from home where          of the gig economy can
lessons of Zika virus a few years on?     that is possible, but about varied          be traced back to the
Or SARS? Or swine flu? How much           working hours, role definition and          downturn a decade ago.
better are we at defending ourselves?     service delivery methods.
At the time, these were serious crises,      In days when demand is in decline
but they seem to have faded from the      almost everywhere, the Institute                   Dr Brian Keegan is Director,
collective memory very quickly. That      sees an upswing in demand from                    Advocacy & Voice, at Chartered
                                                                                                Accountants Ireland.
may be simply because their social        members for resource materials and

                                                                                                      www.accountancyireland.ie
20

     Read more, faster                                                                    you a duty – you owe the paper no duty.
                                                                                             Similarly, just because you have
                                                                                          started to read a book does not mean you

     Cormac Lucey helps you turbo-charge                                                  are duty-bound to complete it. Our time
                                                                                          and attention are limited. If a book is
   your ability to identify and absorb relevant                                           boring, tedious or just getting you down,
                                                                                          discard it and choose another. That book
        information in three easy steps.                                                  may deserve the dismissive review:
                                                                                          “Once I put it down, I couldn’t pick it up!”
                                             have three key rules for managing the
                                             information flow I face.                     Rule 3: Discriminate among
                                                                                          preferred providers
                                             Rule 1: Learn to speed read                  I follow several financial websites
                                             and put it into practice                     closely:
                                             The average best-seller we might take
                                             with us on holidays has about 400            • RTE.ie – click on “Business”, “Broker
                                             words on each page. It is said that              Reports” and “Goodbody” and you will
                                             President John F. Kennedy could read             be directed to a comprehensive review
                                             2,000 words per minute, equivalent to            of the previous day’s business and
                                             five pages per minute. I find that hard to       economic news refracted through the
                                             believe. But with a disciplined approach,        prism of its implications for corporate
                                             it should be possible to read at speeds of       value.
                                             500-600 words per minute regularly.          •   Google “McKinsey on finance” and
                                                 What are the core elements of speed-         you will be directed to the website
                                             reading? Here is a speed speed-reading           of the management consultants’

A
         close friend of mine is a retired   course:                                          quarterly report on corporate finance
         journalist. We were in school                                                        themes. Each quarter, five or six issues
         together for several years in       a) Develop the good habit of reading in          are considered in a succinct and
the 1970s. He went into journalism; I           a smooth rhythm; abandon the bad              intellectually well-founded manner
went into accountancy. In sixth year,           habit of disrupting that rhythm by            with a focus on drawing actionable
our school won the Leinster Senior              occasionally going back to reread a           conclusions.
Schools cup in rugby for the first time         passage;                                  •   Google “Damodaran online”, and
in decades. My pal kept a copy of the        b) Instead of visually absorbing single          you will land at the website of
following day’s Irish Independent,              words, get into the habit of absorbing        Aswath Damodaran, Professor of
complete with match coverage. It                several (three to five) words with            Finance at the Stern School of New
disappeared under the mountain of               each glance;                                  York University. This site features
detritus we are all at risk of gathering.    c) Measure your reading speed when               models, including lots of detailed
Then it re-emerged after both parents           you’re reading a book and focus on            valuation models; data, including
had died, and the family home was               getting that speed up; and                    important sectoral cost of capital
put up for sale. What struck Peter,          d) Practice reading some trashy                  data; and Damodaran’s blog, where
in the early part of this century, was          material at an incredibly fast                he analytically considers important
just how thin that 1978 edition of the          pace. Then, when you read regular             current financial topics.
Independent was compared to the bulky           content, you’ll find yourself
newspapers we have today. Ironically,           chomping at the bit speed-wise,                     Separating the
our newspapers are bigger and better            just like when you come off the
than ever before, even as they face             motorway and chomp at the bit at
                                                                                                    informational
going down under the online onslaught.          the outrageously slow speed limits                  wheat from
   In 1978, nobody was at real risk of          then imposed.                             the chaff is critically
information overload. If anything, we                                                     important today, as each
suffered from information poverty            Rule 2: Focus                                of us could be submerged
back then. Today, however, we are            When you read something, you are
forced to deal with an abundance             reading it for a purpose. Be deliberate
                                                                                          in the flow of information
of information. Separating the               about that purpose. If I’m reading a         pouring our way.
informational wheat from the chaff is        newspaper, I want useful information
critically important today, as each of       and I want entertainment. I also want
us could be submerged in the flow of         to limit the amount of time I devote to                Cormac Lucey FCA is an
information pouring our way. I read          reading the paper. I am certainly not            economic commentator and lecturer
                                                                                               at Chartered Accountants Ireland.
a lot – both online and in print – and       going to read all of it. The paper owes

Accountancy Ireland | April 2020
COMMENT                  21

         Uncertainty reigns
               Economic forecasting can be a difficult business,
           especially when you consider the ‘unknown uncertainties’
             the world is currently facing, writes Annette Hughes.
                                             Global economy                             restrictions, and reduced mobility
                                             In early March, the OECD reported          (affecting consumer spending and
                                             on the considerable human suffering        workers staying at home). There have
                                             and major economic disruption that         already been reports of delays in the
                                             had resulted from COVID-19. OECD           delivery of imported products in the
                                             global growth in 2020 was revised          construction sector, according to the
                                             downwards, by around 0.5 percentage        Ulster Bank Construction Confidence
                                             points to 2.4%, from an already weak       Index. It has been acknowledged that
                                             forecast of 2.9%. The adverse impacts      Ireland will likely follow a pattern
                                             on confidence, financial markets, the      seen in other European countries and
                                             travel sector and disruptions to supply    the Taoiseach’s measures to minimise
                                             chains were all factors contributing       the spread of COVID-19 could be
                                             to the downward revision. However,         significant, but much less than the
                                             without knowledge of the full impact       economic and social consequences of
                                             of the virus, the OECD acknowledged        acting too late.

B
       usinesses do not like uncertainty     that, should the outbreak be more             The flexibility that Irish businesses
       but, at present, that is the          intense and last longer than predicted,    have demonstrated in dealing with
       prevailing economic theme. An         global growth could drop to 1.5%.          evolving economic, political and social
uncertain political situation, ongoing          Economists at Oxford Economics          trends are acknowledged in EY’s
Brexit negotiations and the recent           believe that the virus will result in Q1   February 2020 Economic Eye. EY Chief
coronavirus outbreak remind us how           2020 being the first global contraction    Economist, Neil Gibson, correctly
vulnerable the economy can be to             since Q1 2009, with overall growth of      pointed to the coronavirus outbreak
external shocks.                             2% for the year, the slowest pace in       as likely to damage global growth
   Those in the business of economic         the last decade.                           in 2020, but as a rapidly evolving
forecasting understand this                                                             situation, it is difficult to predict the
vulnerability very well. The purpose         Irish economy                              full economic impact on the island of
of an economic forecast is to measure        The OECD forecast for economic             Ireland. The closure of many public
the impact of ‘known uncertainties’          growth in the euro area was revised        institutions and private businesses in
on future economic performance, but          downwards by 0.3 percentage points         the Republic of Ireland will no doubt
the future is unpredictable and this is      to 0.8% in 2020, although, given           further slow growth across the island,
further complicated by the ‘unknown          that the spread to Europe did not          but the sectoral and regional impact
uncertainties’ we now face.                  materialise until February, this           will vary greatly. It important to
   Economists, in making their               forecast is likely to be subject to        remember, however, that this is first
projections for economic growth in           further downside risks.                    and foremost a human crisis, and we
2020, would not have been aware                 Ireland has an open economy             must think about people first. Moving
of the coronavirus outbreak until            reliant on international trade and         away from GDP numbers, we must
the first reports of a cluster of cases      global markets to support economic         look at what business, governments
were identified on 31 December 2019          growth. Ireland and its economy            and individuals can do together to
in Wuhan, China. The rapid and               accounts for just 0.4% of global GDP       help get us get through this incredibly
continuing escalation of COVID-19 has        and 0.06% of the world’s population.       difficult period.
led economists to revise their economic      However, it still remains vulnerable to       Clearly, these are unprecedented
forecasts downwards, as the initial          the impact of the COVID-19 virus.          times and taking such developments
output contractions in China begin to           Economic growth in Ireland will         into account makes economic
be felt around the world. It remains         definitely be weaker than projected        forecasting a difficult business.
unclear what the full effects will be on     should the virus spread for an
the movement of people and goods, and        extended period. The main impacts
                                                                                             Annette Hughes is a Director at
economic activity, while the response of     are likely to be felt through supply             EY-DKM Economic Advisory.
policymakers is evolving on a daily basis.   chain disruptions, travel and tourism

                                                                                                       www.accountancyireland.ie
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COMMENT                   23

          The hazard                                                                   Chinese walls
                                                                                       Experience suggests that most
                                                                                       professional indemnity claims for

         of professional
                                                                                       negligence arise through allegations
                                                                                       of omission. In other words, some
                                                                                       aspect was overlooked or understated

             advice
                                                                                       by the adviser and should have
                                                                                       been appropriately addressed.
                                                                                       This, of course, enters into the grey
                                                                                       area of opinion of which there
                                                                                       is little legal definition beyond a
         With advice comes responsibility                                              simplistic analysis as to what your
      as almost all advice has consequences,                                           peer group would have done in the
                                                                                       circumstances.
                 writes Des Peelo.                                                         In the ordinary course of events,
                                                                                       a Chartered Accountant is unlikely
                                           I have acted as an expert witness in        to face a conflict of interest in giving
                                           many such cases. Common factors             advice – although a wary eye is
                                           in these claims included allegations        necessary for Ireland’s relatively
                                           that the client subsequently raised         small business network. Others
                                           an issue that was not within the            may, however, experience conflicts
                                           original remit, or did not take the         of interest in a different way, as
                                           advice, or varied its implementation        explained by a straight-faced story
                                           to suit a different purpose.                from the rarefied world of high art
                                               It may not always be possible in        dealings.
                                           everyday commercial situations, but             In a frank memoir, a retired
                                           it is invariably wise to have a clear       director of a major auction house in
                                           letter of engagement (LOE) signed           London explained ‘Chinese walls’ as
                                           as accepted by the client in advance        follows: on one side of the auction
                                           of undertaking the work. The real           house, the potential seller of a
                                           relevance is that the LOE can avoid         painting is reassured as to this being
                                           any later claim of misunderstanding         the best time to sell a painting. On

A
        s a Chartered Accountant,          or ambiguity. The LOE can also state        the other side, in the same auction
        whether in professional            in advance what is to be excluded in        house, the potential purchaser
        or commercial life, our            the advice, as explained below.             is reassured as to the wisdom of
qualification is relied on by others for                                               investing to future advantage in the
knowledge and experience when we           Create clarity                              same painting.
provide advice.                            In my experience, it is increasingly
   Advice brings responsibility, as        necessary to ensure that the                Be brave
almost all advice has consequences.        recipient understands what the              Good advice is always worth it, but
A course of action undertaken, an          advice is not, as well as what it is. For   the advice might be unexpected.
investment made, a decision taken, a       example, that it is not legal advice,       A senior politician, for example,
matter rectified, a risk addressed, and    that it is not tax advice as may arise,     battered by the vagaries of the world,
so on. The accountant can sometimes        or that the advice cannot be taken          remarked to me that if you are ‘being
be unaware that somebody has               as reassurance to a third party             an eejit’, the best advice sometimes
interpreted a comment or course of         (such as a bank or fellow investors)        comes when the adviser tells you so
action as advice. Even responding          as to the standing or validity of the       in plain terms.
to a casual enquiry can be an              circumstances relating to the advice.          And how much should one charge
everyday hazard in a complicated and       The advice is for the recipient alone,      for all this great advice? A wise PR
regulatory world.                          and there is no responsibility to           lady, not entirely tongue-in-cheek,
                                           third parties.                              once told me that advice should
Letter of engagement                          The subsequent written advice            always be reassuringly expensive.
I, in common with other professional       to the client may then state: “This
advisers, have experienced clients         advice is provided in accordance
                                                                                             Des Peelo FCA is the author of
or circumstances where it is later         with the signed letter of engagement             The Valuation of Businesses and
claimed that advice was wrong              (LOE), dated 1 April 2020. For good               Shares, which is published by
or inadequate. Thankfully, none            order, a copy of the LOE is attached            Chartered Accountants Ireland and
                                                                                               now in its second edition.
developed into legal claims – though       to this letter”.

                                                                                                      www.accountancyireland.ie
24        COMMENT

              The benefits
                                                                                          for diversity statistics and initiatives.
                                                                                          It is not acceptable, nor prudent, to
                                                                                          arrive at a beauty parade with an all-

               of balance
                                                                                          male team to discuss a proposal with
                                                                                          what is usually a diverse team on the
                                                                                          other side. And it is not only in pitch
                                                                                          situations. Clients – and in particular,
                                                                                          international or global ones – now
      It is important, and indeed useful, to                                              frequently include requirements around
   remind ourselves about the business case                                               diversity in their terms of engagement.
                                                                                          Some conduct diversity audits and
   for gender balance, writes Rachel Hussey.                                              evaluate the composition of teams and
                                                                                          the numbers of hours worked by both
                                            of Ireland has called out the specific        men and women. We ultimately need to
                                            need for diversity across senior decision-    focus within professional services on
                                            making levels based on evidence of            representing the increasingly diverse
                                            increased standards in governance             client base that we serve.
                                            practices and a more balanced risk                Diversity is also important from a
                                            appetite.                                     reputational perspective. The media
                                                In many industries, a large part of       – and the trade press as well – have
                                            the challenge around achieving gender         a keen focus on gender balance and
                                            balance is the small number of women          new partner announcements can be
                                            who enrol for or graduate from the            the subject of criticism and comment
                                            degrees relevant to the industry in           if there is a lack of gender balance,
                                            question. For example, engineering            particularly on social media.
                                            companies find it more difficult to               Firms that make progress in this
                                            recruit women because of the small            area, and are seen to do so, will have a
                                            percentage of women who study                 real competitive advantage in what is an
                                            engineering in college, which in turn         asymmetric market. Research carried
                                            is as a result of not enough girls taking     out by the 30% Club shows equally

A
         lot of the recent discussion       STEM subjects in school. Furthermore,         high career ambitions across men and
         around gender balance and          in law, over 60% of graduates are             women. However, the same study also
         its importance in business         women, and in 2018 there were more            indicates less confidence among women
presupposes that everyone believes that     women on the roll of solicitors than          regarding their potential to progress.
working towards and achieving gender        there were men for the first time. And            This is perhaps a topic for another
balance is a good thing and that we all     this trend has continued. Data published      article, where we might also talk about
know why this matters.                      annually by the UK’s Financial                the practices a modern professional
   A large body of research                 Reporting Council also indicates that         services workplace needs to attract
demonstrates that diversity is good         the numbers of men and women opting           and retain talent – all of which will be
for business. Diversity leads to better     for careers in accountancy are close to or    tested as we work through the current
decision-making, enhances the               at parity in recent years.                    challenges posed by coronavirus.
attraction and retention of talent and,         In contrast, the overall profile of the
most importantly, improves the bottom       profession is closer to one-third women        I was very pleased to be invited to write
line. For example, McKinsey’s recent        and two-thirds men. Anecdotal evidence         articles in this publication on gender
report entitled Delivering Through          suggests that the position is somewhat         balance in business. Since my first
Diversity shows that companies in           better in Ireland. However, a gender           article the world has experienced, and
the top quartile for gender diversity       imbalance remains, particularly at more        continues to experience, unprecedented
                                                                                           change and uncertainty and that
within executive boards were 21% more       senior levels. This makes the retention        looks likely to continue for some time.
likely to outperform on profitability.      of women in the professions a key              Businesses will have very different
Investors are increasingly focused on       business opportunity if employers are          priorities in the period ahead and I am
gender diversity, and Goldman Sachs in      to harness the full value of the available     writing on the basis that we will return
February announced that it would only       talent.                                        to (perhaps a different) normal and
                                                                                           that we can resume the discussion on
underwrite IPOs in the US and Europe            A key lever in professional services       issues around sustainability (including
of private companies that have at least     firms is client demand. Clients are very       diversity) in that new normal.
one diverse board member. And starting      focused on their diversity ambitions and
in 2021, it will raise this target to two   they expect their service providers to
diverse candidates for each of its IPO      be as well. Firms increasingly see tender          Rachel Hussey is Chair of 30% Club
                                                                                              Ireland and a Partner at Arthur Cox.
clients. Closer to home, the Central Bank   documents with questions and scoring

Accountancy Ireland | April 2020
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