Over half of global CFOs admit that managing data security and privacy is the biggest challenge in corporate reporting and believe that lack of clarity over data ownership and governance is having an impact on reporting effectiveness
EY’s latest report on reporting and governance found that CFOs in India (68%) are the most concerned about data security and privacy, followed by China (65%) and the US (63%). This compares to 55% of UK respondents.
Of the 1,000 CFOs and financial controllers surveyed, 85% said that they found it either ‘very challenging’ or ‘somewhat challenging’ to actively manage data flows based upon different jurisdictions’ privacy laws.
These respondents also believe that assessing the different security standards for data centres versus cloud computing was a key challenge to data protection, privacy and compliance.
Half of respondents from the UK (48%) said that a major barrier to technology transformation and implementation of new technology is concerns over security and compliance risks of the cloud.
Chris Brown, EY’s UK head of business assurance, said: ‘CFOs need to ensure that they have clear governance processes in place for how they look after financial information and ensure that data is both compliant with relevant local laws and is secure – which can be a huge challenge in large and complex organisations.
‘Responding by using advanced data analytics and integrated technologies as well as artificial intelligence, cloud computing and robotic process automation will be key to avoiding reputational and other costs that come with a mismanagement of financial data.’
Traditional approaches to corporate governance are changing with audit committees asking for more information on data protection and privacy. Currently 85% of CFOs are providing automated alerts to audit committees and boards about governance, risk and compliance issues, with this increasing to 95% of US respondents and 93% of UK respondents.
Brown said: ‘It is no longer a time for reactive corporate reporting. Boards are expecting management to report issues to them in real-time. These increasing demands for more insightful corporate reporting mean reporting teams need to draw on the volumes of data available, as well as technology advances, to deliver new levels of insights that board members require to fulfill their governance role.’
EY’s report: Can innovative corporate reporting build trust in a volatile world? is available here.
