Organisations large and small, in the public and private sectors, have expressed deep concerns about the impact of Covid-19 on their people, productivity and cashflow, according to ACCA’s new global research among 10,000 finance professionals, including an expert panel of 353 in Pakistan.
Head of ACCA, Pakistan, Sajjeed Aslam, said: ‘Our research shows the most severe impact on businesses is employee productivity being negatively affected, with 56% of respondents saying this is the case. Also 46% of business leaders suggest their organisations are facing significant cash flow problems.
‘Only 31% of businesses have managed to do a financial reforecast, and 39% of these consider a worst-case scenario will be negative revenue growth of 50% or more compared to the previous financial year. With 34% of organisations already freezing recruitment, businesses are looking to gain help from banks and debt providers.’
Sajjeed Aslam revealed the survey’s aim was to explore difficulties faced by organisations of all sizes across the country.
He said: ‘This research aims to understand the business and financial blows to organisations across the country. It is seen through the lens of ACCA Pakistan’s members – finance professionals supporting a wide range of businesses and organizations at this hugely difficult time.
‘The findings gauge the short to medium term implications, while also looking at the measures being undertaken and considered by organisations to mitigate the damage. It also looks at what lessons we can all learn from the pandemic.’
Mr Aslam highlighted crucial advice for firms to follow in these unprecedented times, adding:
‘ACCA’s recommending that organisations follow the ‘three As’ of crisis planning – Act to respond in a sustainable manner and focus on employees and stakeholders; Analyse the different information sources to secure your organisation; and Anticipate the business impact and future trends.’
Jamie Lyon, the report’s author, explains: ‘Everyone is hurting, but particularly the smaller organisations. Financing and cash flow are concerns to everyone, but even more so for small organisations. For many of us, the ‘face of work’ has changed overnight. In the short term, leaders are facing a very difficult operating environment when it comes to employee productivity and engagement, alongside a number of compounding and wide-ranging challenges - stifled and stalled customer demand, supply chain disruption, people mobility issues, product and service delays or deferments, investment challenges and so on.
‘All this is of course translating to the financials being affected because fundamentally all of these blows are interconnected. But what’s heartening to see is many organisations’ commitment to ensuring the health and wellbeing of employees, customers and other stakeholders first and foremost.’
The main findings for Pakistan show:
· 56% - Employee productivity negatively affected
· 46% - Cash flow problems
· 31% - Customers stopped / reduced purchase – customers impacted by the virus
· 37% - Having to defer launch of new products and services
· 23% - Customers stopped / reduced purchases – supply chain disrupted
· And 69% of organisations have not been able to do a financial reforecast, perhaps due to the fast-evolving scale and duration of the Covid – 19 pandemic alongside the extent of necessary social distancing controls put in place by governments, which have created vast uncertainties for businesses.
Sajjeed Aslam concludes: ‘Overall the data confirms Covid-19 is a huge challenge across all sectors and sizes of business, and regions and countries. The main issue is uncertainty, which affects the ability of organisations to plan properly, to react and to forecast appropriately. While talking of silver linings may be very hard at this time, we need to think about every opportunity, and to consider every option available to keep businesses large and small afloat.’
·ACCA is holding a webinar on the 16 April 2020 to discuss these findings, which will be published in full on the 27 April 2020: http://accamember.newsweaver.co.uk/invitation/1586s9wf53w
·The survey supporting this research closed on Thursday 26 March 2020.
· Please refer to ACCA’s Covid-19 Hub, which includes useful resources to help organisations deal with the impacts and implications, including advice for ACCA members in practice and in business, students, and a section on wellbeing.