Ensuring responsible accounting rules and procedures is now a core business strategy of British and Irish companies, according to a survey by consultancy Cap Gemini Ernst & Young.
Some 61 per cent of businesses are focused on fiscal rectitude following the Enron and other accounting scandals. Companies are also highly motivated to cut costs and reduce spending, the new survey shows.
Some 88 per cent of executives said cutting costs was their chief concern as they planned investments, closely followed by the need for operational efficiencies (85 per cent), with 41 per cent prioritising obtaining a better return on investment.
"We were surprised at the uniformity of view between the generality of people, who are clearly feeling uncertain," said Mr Eamonn Doyle, managing director of Cap Gemini Ernst & Young Ireland.
"Obviously, companies are focusing on their cost base, on making the best use of their resources, and internally battening down the hatches," he said. The report notes that companies are turning away from risk, and also turning away from creative initiatives.
"The entrepreneurial spirit of the dotcom days has fallen by the wayside. Instead, \ are concerned solely with operational efficiencies and the bottom line," the report notes.
But on the positive side, Mr Doyle said companies were becoming more flexible as they adapted to a changed economic and business environment.
Businesses are talking more to their business partners and employees - even with competitors, according to the survey, in which 72 per cent said better communication with stakeholders was essential.
Companies are also encouraging employees to take on less rigid roles and are willing to invest in training, with 68 per cent of executives saying they were broadening their employees' skills base and moving away from specialised roles.
The report notes that as a result of external pressures, organisations have to redefine themselves and change their infrastructure.
Some 63 per cent have reconfigured their IT systems, 59 per cent have reconfigured their internal processes and 55 per cent have redefined their skill requirements. Some 69 per cent of senior executives are finding that they increasingly need to adopt customer-facing roles and 77 per cent feel it necessary to monitor operational decision-making.
Mr Doyle said companies were increasingly becoming "adaptive companies" and realising that fast-paced change and economic uncertainty were not once-off events but a permanent element of business. "This volatility will always be with us. There needs to be a mind-change - executives need to look outside the company, and be able to react and change."
Information technology systems seem to hinder rather than help this process in many cases.
"Half of companies feel their IT systems prohibit them from making a rapid response," he said.
