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7 Global context

Throughout 2020-21, ACCA has considered the global context carefully, consulting with external experts and drawing on our own market, strategic, professional and customer insight, and behavioural data to identify a series of factors that will present challenge and opportunity for ACCA in 2021-22 and beyond.

 

Economic overview

In 2020, the global economy was severely impacted by the Covid-19 pandemic, with global output falling to 90% of the previous year’s levels, according to the Organisation for Economic Co-operation and Development (OECD). Like most organisations, this had significant impacts for ACCA. Looking ahead, the OECD anticipates a global recovery back to 2019 levels by December 2021, and our own analysis indicates that a number of macro forecasts are now broadly trending up. Despite this, a range of social restrictions persist in many ACCA markets as we enter the 2021-22 performance year.

Beyond Covid-19, we are seeing a number of significant geopolitical and economic developments. These include the new Democrat administration in the US, the publication of China’s 14th five-year plan and the UK exiting the EU.

Global growth markets in which ACCA is active give sharply contrasting pictures of economic recovery. While China’s economy is expected to grow by 7.9% in 2021 (compared with 1.9% growth in 2020), the pandemic has had a profoundly negative impact on India’s economy. In late 2020, India fell from fifth to sixth place as a global economic superpower (behind US, China, Japan, Germany and the UK) and, in March 2021, is still in recession with a very high incidence of Covid-19 cases.

The global systemic shock brought about by the pandemic is, however, also presenting opportunity for the profession. As the world seeks to recover from the events of 2020, there is a growing movement across governments, regulators, business and society to ‘build back better’, driving a more sustainable approach to economic recovery.

This presents a clear opportunity for the profession and its members to advise and influence governments, regulators and business on the key role they can play in delivering sustainable recovery and returning to growth. ACCA and other professional accountancy bodies also have a critical role to play in transforming the profession in response to digital acceleration and other disrupters, upskilling those within it to seize the opportunities it presents.

Key external drivers

The key factors shaping our external environment are:

  • Economic impact of the pandemic: Covid-19 is causing significant economic disruption across ACCA’s markets. This continues to impact employment and create risks to member and future member retention. We recognise that we will need to both articulate and demonstrate the continuing value of a relationship with ACCA, providing members and future members with a strong sense of community and value, and ensuring that we act with their best interests at heart.
  • Climate change and natural capital protection: 2020 saw record-breaking temperatures, as well as devastating wildfires and flooding, further emphasising the need to redouble efforts on climate change and protection of the planet. As business, finance and governments look ahead to how to shape both green and socially inclusive recoveries, the accountancy profession will be – in the words of Mark Carney, UN special envoy on climate and COP 26 finance adviser – ‘absolutely essential’ to delivering the change the world needs. The uniquely wide view that professional accountants have across the organisations that they work for and advise, coupled with their ethical and technical competencies, makes them vital to this transformation that can place impact at the heart of business decision-making. ACCA therefore has a vital role in ensuring that members and future members have the competencies to fulfil this need.
  • Geopolitical environment: political tensions continue to present potential risks to ACCA’s operations. Following the Covid-19 outbreak, we have seen both the protectionist and global collaboration scenarios that informed our strategy to 2025 play out in diverse ways. While the rise of a global talent force has been facilitated by increased remote working, this is juxtaposed with increased nationalism in some areas of the world. This creates a need to emphasise the value ACCA brings in offering nationally relevant leading-edge skills informed by global best practice.
  • Demand for accountancy: an ongoing demand for accountants is being driven by the current emphasis within organisations on financial sustainability and the growing move towards transparent reporting. Digital acceleration is, however, creating disruption within the profession, particularly impacting lower-level roles. This creates an opportunity to demonstrate ACCA’s continuing relevance and our ability to equip members and future members with the skills the marketplace needs, both now and in the future.
  • Digital acceleration: across the world, we are already seeing a radical acceleration in digital adoption, with some countries and industries more ready and willing to adapt than others. While this creates challenges for ACCA in terms of greater global inequality in relation to digital maturity, it also creates the opportunity for ACCA to position itself as a digital leader both in the knowledge and skills we provide and the methods we use to deliver.
  • The skills members and future members will need: Covid-19 has radically re-shaped the skills needed by employers. Our customer insights highlight shifts in what our members want to learn as well as how they want to learn, with data and technology ranking as a key technical skill to develop, correlating with our view of an accelerated digital shift. There is opportunity for ACCA in the area of continuous learning, and 97% of members now see ACCA and its partners as their first-choice source of CPD. ACCA also has a significant opportunity to capitalise on the digital acceleration and changing needs of employers by defining and delivering a future vision for learning and assessment that delivers what the world needs. Climate change and natural capital management will also drive and accelerate the need for wider and greater non-financial reporting.
  • Partnerships: ACCA is seeing all our partners (employers, education providers, governments, regulators and others) impacted by Covid-19 in different ways, with some adapting swiftly and others requiring significant support to adapt. ACCA partners in the future will remain critically important as we seek to deliver value to our community, drive our continuing growth and reinforce our relevance, attractiveness and leadership of the profession.

ACCA’s response

Pre-pandemic, ACCA was already preparing for an accelerating pace of change. Detailed analysis of the disruptors of the future, coupled with scenarios work to test ACCA’s strategic response, informed the development of our flexible and responsive new strategy.

The strategy to 2025 has enabled us to act swiftly and decisively from the start of the global systemic shock caused by Covid-19, notably by:

  • adjusting our focus in 2020–21 to scale back some aspects of our strategic ambition but significantly accelerate others set out in our strategy to 2025. In particular, we have concentrated on introducing and rapidly expanding our online exams with remote invigilation, and accelerating our own digital readiness plans to engage with and connect the ACCA community more comprehensively than ever before
  • placing an even greater emphasis on supporting our members through building our portfolio of digital upskilling opportunities, enhancing our careers support offerings and reinforcing the vital role professional accountants play to employers
  • supporting our future members by focusing even more strongly on ensuring access to quality tuition, developing new student support tools – including those aimed at wellbeing – and enabling our education partners to transition to digital delivery
  • maximising the potential of our new approach to customer insight, we were able to draw extensively on the voice of the customer (augmenting our monthly relationship surveys with additional activity, including member and future member welfare surveys and exam experience surveys) to deliver the products, services and solutions needed. We also leveraged the collective insight of our community to create relevant, timely and world-class insights to build confidence in ACCA and the profession and lead the way forward
  • further embedding a ‘customer-first’ mentality across our global network, demonstrating our ability to deliver to market more swiftly than ever
  • and

  • leveraging new digital capabilities which enabled the organisation to rapidly pivot to operating virtually.
  • In light of the continuing uncertainty caused by the global context, and in particular the Covid-19 pandemic, our core assumption is that both ACCA and its community will continue to face significant disruption during the first six months of 2021-22. With this in mind, our view is that the most appropriate and pragmatic approach to 2021-22 is to continue to deliver against a critical strategic focus, with associated measures that ensure we are targeted in our response.

In 2021-22, we will also continue to challenge how we operate, innovating to deliver our ambitions. This will enable us to move forward with purpose, seizing new opportunities and investing for the future to propel ACCA forward.