Liza Robbins, Kreston Global Chief Executive, shares her thoughts on what makes a great international leader.
A requirement for leadership
The first is that thinking internationally positions you for success in a globalised world. More than that, it’s a prerequisite for leadership. Our countries are far more connected and interdependent than they used to be, and being able to confidently navigate the different environments in which you will find yourself is a key competence.
If you’re narrow-minded, you’re going to fail. You will not connect to the people you’re dealing with, you may not understand how they operate, and there may be multiple misunderstandings. Of course, you can’t entirely erase a culture gap just by being curious, but the willingness to learn goes a long way.
You will also miss opportunities to learn and grow. There is so much we can learn from other cultures, both about how to do business and about life more generally. You don’t have to struggle to reinvent the wheel at your firm when you can simply watch how your peers at Kreston firms elsewhere operate and adapt their best practices. This is how many of the greatest advances are made.
When you think internationally, you will talk to clients and colleagues about your differences and commonalities, exchange views and share what’s important to you. The result will be deeper, more meaningful relationships.
These aren’t just ‘nice to have’ but the foundation of long-term partnerships and a sustainable business. The reason that “Knowing you” is the Kreston motto is precisely because having these conversations and forming these deeper relationships is critical to offering a transformative service.
Think Internationally… Even locally
All this applies and benefits you at a local level too. Although we talk about thinking “internationally”, this mindset does not miraculously switch on when you phone someone in another country or get on a plane abroad. Being curious about others makes you a better, more informed, and more personable leader at home.
And finally, this approach is fun! At least I’ve always found it to be so. Nothing is as interesting as other people. If you enjoy travelling and discovering new places and new sights, actually getting to know people whose lived experience is very different from your own is even more fulfilling.
None of this necessarily comes naturally and simply belonging to an international network does not automatically mean you’re thinking internationally. Your mind can still be shut even if you speak to people on the other side of the world every day. It’s a skill that has to be cultivated.
Consciously develop your international thinking
An oft-cited survey by McKinsey showed that 76% of senior executives believe that their companies need to develop global leadership capabilities while only 7% think that their efforts are effective. That survey is more than a decade old now but the gap and the need certainly still exist.
Some of you may be natural ‘international thinkers’ while others will want to be. Either way, I want to challenge both you and your teams to do more to consciously think internationally.
Here are some easy baby steps:
When a firm joins Kreston from another country, email them and ask them to share something about themselves. Better still, get on the phone.
Every time a new firm joins, follow them on LinkedIn. Notice their cultural celebrations and the issues that are important to them.
Get your atlas out! Do you know where our firms on other continents are located?
Through globalisation, our world is getting bigger. But the more you get to know people, the smaller it feels. That’s exactly what we should be aiming for – to take actions that make us feel closer and more intimate, whatever the distance between us.
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Kreston Global retains 13th position in global rankings
Kreston Global has maintained its 13th position in the International Accounting Bulletin world survey. Kreston Global continues to enjoy steady growth, with a 4% turnover increase in 2022.
The network has attracted a record number of new firms in recent years and US firm CBIZ MHM has contributed significantly to the growth with key strategic acquisitions, including New York–based Marks Paneth, helping to propel CBIZ MHM from 13th to 8th position in North America regional rankings.
Liza Robbins, Kreston Global Chief Executive commented,
“We are delighted to have retained our global position, although our focus continues to be on delivering real benefits to firms to help them grow and thrive, and less about global rankings.
The fast pace of development of Kreston Global led to a new strategic plan being unveiled in 2021, which embraces the network’s wider purpose-led approach. The new firms that have joined us over the last 12 months have only enhanced the strong ties that connect our firms to each other.
2023 looks set to be another strong year of member growth, with excellent firms interested in joining the network.”
If you are an ambitious, internationally-focused firm that is interested in joining Kreston Global as a member, you can fill out a form to apply to start your application.
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Stuart Brown
Kreston Global ESG Committee member, Head of Technical and Compliance at Duncan & Toplis
Stuart is an FCA-qualified chartered accountant with more than ten years of practical accounting and audit experience.
He leads the technical developments for Duncan & Toplis. This covers audit, financial reporting and maintaining the quality of work.
He has recently been appointed to Duncan & Toplis’ operations board and has become a member of the ICAEW’s influential Ethics Advisory Committee. Stuart also sits on the Kreston Global ESG Committee.
ESG reporting in the UK
March 8, 2023
ESG reporting in the UK applies to entities that are classified as ‘large’ for reporting periods beginning on or after 1 April 2019, there has been a requirement to report on energy use and associated greenhouse gas emissions.
For accounting periods beginning on or after 6 April 2022 UK company law has mandated disclosure covering climate-related matters for certain entities. Disclosure must include a description of:
Governance arrangements for climate-related risk assessments and opportunities, including a description as to how an entity identifies such risks, how they assess them and their response.
How this risk assessment links to the overall risk management process.
The most significant risks identified and their impact on an entity.
How able to cope with the risks identified an entity is covering different scenarios.
Specific targets (including KPIs) used by an entity to manage identified risks and how the entity is performing against those risks.
Such disclosure is not required for all entities and has been introduced only for:
UK companies that have more than 500 employees and are either traded, banking or insurance companies.
UK companies listed on AIM with more than 500 employees.
Other UK companies that have more than 500 employees and a turnover of more than £500m.
LLPs that have more than 500 employees and a turnover of more than £500m.
In addition, in the UK, the listing rules mandated by the Financial Conduct Authority (FCA) require premium-listed and standard-listed companies to make disclosures under the TCFD (Task Force for Climate-related Financial Disclosure) framework. Further details on this can be found at https://www.fsb-tcfd.org/publications/.
Transition Plan Taskforce
2022 also saw the launch of the Transition Plan Taskforce (TPT). The aim of this group is to standardise the disclosure framework relating to the communication of the transition plans (to net zero) of UK private companies, to ensure that consistent, detailed, robust and credible plans are in place. Further details can be found at https://transitiontaskforce.net/.
Although mandatory disclosure of ESG-related matters is currently focused on the largest entities, entities of all sizes should feel encouraged to start to bring in ESG matters into their reporting and strategic decisions. All companies will benefit from being aware of the risks that they face from ESG matters and on the impact that their activities have on a wider stakeholder group.
If you would like to talk to one of our experts about your ESG reporting obligations in the UK, please get in touch.
Global vacancies
Winship House, Winship Way
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Carmen Cojocaru
Managing Partner at Kreston Romania
With over 20 years of professional experience in accounting, Business Process Outsourcing, audit and tax as a certified accountant, financial auditor and tax advisor, Carmen Cojocaru (Managing Partner at Kreston Romania) focuses on helping business clients with their accounting, tax and audit world.
The EU Taxonomy Regulation explained
The EU Taxonomy Regulation is an ongoing piece of legislation with a major impact on the way we assess, measure and report sustainable activity. It’s essential to understand the rules as the world moves towards a green economy.
Green finance continues to be a crucial factor in tackling the world’s climate challenges: the more investment can be funnelled towards environmentally responsible activities, and away from harmful ones, the closer we’ll get to a sustainable economy.
But while there are many people who are eager to make investments that are good for the planet, the field has been plagued by a lack of clear definitions and regulated language around environmental, social and governance (ESG) investments. The use of so-called ‘greenwashing’ by companies to brand themselves as sustainable has also damaged public trust in such claims.
To tackle this problem and finance sustainable growth, the European Commission has created an action plan with two objectives: to ensure transparency and reorient capital flows toward sustainable investment.
To reach these objectives, the Commission has presented the concept of taxonomy.
Its mission is to define environmentally sustainable economic activities, and move more capital towards activities that substantially contribute to the EU’s Green Deal objectives: climate neutrality, zero pollution, preservation of biodiversity, a circular economy, and a high degree of energy efficiency.
By establishing a list of environmentally sustainable economic activities and informing companies, investors, and policymakers about them, the taxonomy has a number of benefits, including:
● security for investors ● protecting private investors from greenwashing ● helping companies to become more climate-friendly ● mitigating market fragmentation ● shifting investments where they are most needed.
In short: the EU taxonomy is a classification system that translates the EU’s climate and environmental objectives into clear criteria, to create a common language around green activities.
Objectives and activities: what counts as sustainable?
The Taxonomy Regulation establishes six environmental objectives:
Climate change mitigation: the process of keeping the global average temperature to below 2°C by 2050 and pursuing efforts to limit it to 1.5°C above pre-industrial levels, as set out in the Paris Agreement
Climate change adaptation: adjusting to actual and expected climate change and its impacts
The sustainable use and protection of water and marine resources
The transition to a circular economy
Pollution prevention and control
The protection and restoration of biodiversity and ecosystems
The Regulation also provides three classes of activities that can be included in the taxonomy:
Primary: activities that directly contribute to one of the six environmental objectives above.
Transitional: activities that support the transition to a climate-neutral economy.
Enabling: activities that facilitate the primary activities indirectly.
For an activity to be considered eligible, it should substantially contribute to at least one of six environmental objectives from any of the three activities.
So far, the EU has only formally adopted the first two environmental objectives – climate change mitigation and adaptation.
Disclosure requirements associated with natural gas and nuclear energy activities have also been adopted.
Alignment: what counts as a substantial contribution?
Defining an economic activity’s eligibility according to the taxonomy is one step of the process. Next is a very important one: alignment.
The activity’s taxonomy alignment must be defined by technical screening criteria (TSC) – the specific requirements and thresholds that each activity will need to meet to be considered as significantly contributing to a sustainability objective and doing no significant harm to others.
The TSC is set out in secondary legislation from the EU, called Delegated Acts.
These set out the following criteria to define aligned activity as environmentally sustainable:
Making a substantial contribution to at least one environmental objective. The economic activity should have the potential to do any of the following: ○ replace high-impact activities (e.g. renewable energy) ○ make a substantial positive environmental impact ○ substantially reduce adverse effects on the environment (e.g. substantially reduce levels of greenhouse gas emissions).
Doing no significant harm (DNSH) to any other environmental objective. The economic activity should not impede the other environmental objectives from being reached.
Complying with minimum social safeguards. The activity must be compliant with minimum standards on: ○ human rights ○ social responsibility ○ labour rights ○ anti-corruption procedures Organisations must follow the OECD Guidelines for Multinational Enterprises and the UN Guiding Principles on Business and Human Rights, including the International Labor Organization’s (‘ILO’) declaration on Fundamental Rights and Principles at Work, the eight ILO core conventions and the International Bill of Human Rights.
Complying with the TSC.
Activities that meet these four conditions are considered environmentally sustainable by the Taxonomy Regulation, but this doesn’t necessarily mean activities that do not meet these four conditions are ‘unsustainable’.
In the EU’s view, activities can make a substantial contribution when they have a low impact on the environment and have the potential to replace high-impact activities (e.g. renewable energy), reduce impact from other activities (e.g. wastewater treatment) or make a positive environmental contribution (e.g. restoration of wetlands).
These types of activities are not explicitly listed in the Taxonomy Regulation but there are ways to understand the meaning of ‘substantial contribution’ as it applies to them.
Reporting: what do companies need to do?
As of January 2023, companies subject to the Corporate Sustainability Reporting Directive (CSRD) must disclose information about how and at what scale activities are environmentally sustainable by demonstrating proportions of turnover, capital expenditure (CapEx) and operating expenditure (OpEx) with KPIs in their management report, as part of a sustainability report.
Companies that fall within the scope of the Non-Financial Reporting Directive (NFRD) were already required to prepare a non-financial report, presenting environmental and social matters, respect for human rights, anti-corruption and bribery, diversity on company boards and allocations of turnover, OpEx and CapEx across environmentally sustainable activities.
(Those in scope of NFRD include large public-interest companies with more than 500 employees: listed companies, banks, insurance companies, and other PIEs.)
If you’re still puzzled by the rules or wondering where your organisation’s activities fit, you’re not alone. The EU recognises that the Taxonomy Regulation is highly complex and difficult to integrate into business databases and other systems.
To make things easier, the Commission has come up with the EU Taxonomy Compass, which includes taxonomy-eligible activities, objectives they substantially contribute to, and what criteria they must meet.
Another platform that helps stakeholders from the public and private sectors is the Platform on Sustainable Finance, an advisory body which provides advice on the EU Taxonomy, the broader sustainable finance framework, the TSC and monitoring capital flows into sustainable investments.
The Taxonomy Regulation — along with the SFDR, CSRD, and ongoing policy initiatives such as the EU ‘ecolabel’ for retail financial products and the Green Bond Standard — will ensure that taxonomy-aligned activities are visible and recognised in investment decisions.
The green transition
Meeting the TSC might still be optional for some companies, but anyone can benefit from improving their green performance. Eventually, all businesses will need to adapt to more sustainable ways of working, in what many are seeing as a ‘green transition’.
Companies wishing to contribute substantially to climate and environmental objectives can voluntarily decide to use these criteria when planning their transition to sustainability.
Companies with taxonomy-aligned activities will benefit from institutional and retail investors that want to make a positive environmental impact, and banks interested in green investments and considering the possibility of being incentivised (for example, through lending).
To transition, companies should understand the concept and the mechanism of taxonomy – which, as we can see, is no easy task. The EU Taxonomy is moving at a lightning pace, which comes with its flaws.
A common challenge is dealing with the ambiguity of the criteria. For example, the application of DNSH and the minimum safeguards for activities around climate change adaptation can be difficult to define. Another challenge is the different interpretations and comparisons of disclosures.
On the bright side, it will be possible to compare companies with the same economic activities for the first time.
More revisions and further guidance (for example, on applying the Environmental Delegated Act) are expected to continue in 2023, with the new mandate of the Platform on Sustainable Finance.
The process of applying the EU Taxonomy is yet to be learned from experience, but companies are expected to improve and have a natural, sustainable impact. Those companies that see the taxonomy as a continuing opportunity and act on it will benefit in the future. One thing is sure: the EU Taxonomy sets the new gold standard in economic activities.
Talk to us about how the EU Taxonomy Regulation might affect you.
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Kreston Charities Report reveals uncertain future for UK charities
March 7, 2023
The Kreston Charities Report 2023, released by the Kreston UK Charity Group, has revealed that UK charities are facing an uncertain economic outlook, challenging recruitment, and fundamental issues such as a lack of diversity at board level. The report provides important insight into the experiences of a wide range of charities across the UK, with Duncan & Toplis contributing significantly to the report.
Charities are feeling the pinch, with a large majority seeing costs rise over the past 12 months due to soaring energy bills and a steep hike in inflation. This, combined with limited financial resources and challenges in recruitment efforts, has left many charities facing an uncertain future. However, 73% of charities consider their financial reserves to be sufficient to cover future development plans and contingencies for increased costs or reduced income.
Recruitment has become more challenging for charities, with rising costs and limited financial resources making it difficult to offer competitive salaries. To overcome this, charities are looking to offer non-financial rewards to entice new recruits and retain existing employees.
Charity board diversity
The report also highlights fundamental issues such as a lack of diversity at board level, which is a major worry for the charities surveyed. 72% of charities are concerned about the lack of diversity among their Board of Trustees. Mental health support for staff/volunteers has become increasingly important, with 82% of charities stating that their beneficiaries are more affected by mental health now than they were before the pandemic.
Charities and cybersecurity
Despite the challenges, the report also shows that charities are on the whole well-equipped to deal with cybersecurity, and environmental issues are increasingly important, with half of the charities addressing climate concerns despite them not being part of their objectives.
The Kreston Charities Report 2023 provides important insights into the challenges and opportunities facing UK charities and highlights the need for charities to address fundamental issues such as diversity and mental health support.
If you would are a charity and you would like to speak to one of our UK firms, please find your nearest UK office here.
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International Women’s Day: Jenny Reed
International Women’s Day is celebrated globally every 8 March to recognise the contributions of women to social, economic, cultural, and political advancements. The day also calls for action to accelerate progress towards gender equality and women’s empowerment. This year, Kreston Global aims to feature a few remarkable women from their network and learn from their experiences on what it means to be a successful woman in the organisation.
Jenny Reed is a well-established figure in the accounting and auditing industry, with over 25 years of experience across both public practice and industry. Earlier this year, she was appointed Director of Quality and Professional Standards at Kreston Global, a role she has taken on with great enthusiasm and expertise. Before this, she served as the Head of Audit and Assurance at Baker Tilly International, where she established a reputation for herself as a dedicated and innovative leader.
What drives as a senior role in the global accounting network? My key driver is the desire to help people – I work for the benefit of our member firms, so everything I do is to help them, ultimately to help them help their clients.
Do you think the sector welcomes females in leadership roles? Things have improved since I joined the accountancy profession some 25 years ago. When I was a trainee, I wasn’t even allowed to wear trousers at work! Thankfully, things have moved on a lot since then, and we are seeing far more female directors and partners and more women in senior leadership roles within the global offices of accounting networks. So I think it’s imperative to do all I can to encourage and enable the next generation of women moving up in the profession. We can all do that at every stage of our careers.
What qualities do you need to be a successful female leader in global accounting? Working internationally is a great privilege. People from different countries, cultures, and backgrounds have their perspectives and ways of working, and part of my role is to help bring those other ideas and views together for the benefit of the whole network. You need to be a good listener and have much humility – I have strong opinions but hold them very lightly, as I never know when someone worldwide will have a better idea or approach. A certain amount of diplomacy and patience is also needed – bringing people together and reaching a consensus can take time but is valuable to the organisation.
We recently surveyed ‘interpreneurs’ – entrepreneurs looking to expand internationally. The data showed that female CEOs were more likely than males to consider expanding overseas. Why do you think this might be? Historically, many women believed they needed to work harder and be better than men to get ahead, and their drive to succeed may encourage them to take the risk to go global. Effective overseas expansion is always a collaborative effort, so since teamwork is a strength of many women, this statistic doesn’t surprise me.
There was a significant indication that existing networks were an attraction to overseas expansion in particular countries; why do you think female interpreneurs value this more than their male counterparts? Knowing that you have access to local knowledge and expertise through an accounting network is reassuring and gives confidence to interpreneurs to focus on what they do best.
What advice would you give your 28-year-old self? When I applied for trainee roles in accountancy, I was surprised at how many interviews I was offered. In the early part of my career, I would frequently underestimate my abilities and not push myself forward for promotions. The best advice I could give my younger self would be to have confidence in my abilities and to reach for the stars!
Read more from our other featured women for International Women’s Day, here.
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International Women’s Day: Mercè Martí Queralt
Each year on 8 March, the world observes International Women’s Day to acknowledge women’s accomplishments in various social, economic, cultural, and political fields. It is also an opportunity to advocate for gender equality and women’s empowerment. Kreston Global uses this occasion to highlight exceptional women within their network and gain their perspectives on what defines success as a woman in their organisation.
Mercè Martí Queralt is a highly experienced professional with over 30 years of expertise in auditing. As the Executive President of Kreston Iberaudit, Mercè plays a crucial role in representing Kreston Global in Spain, Portugal, and Andorra, and is responsible for driving the company’s expansion and internal development plan. Iberaudit is a leading audit network in the region, representing Kreston. Mercè’s exceptional leadership and strategic vision have driven the company’s success and cemented its reputation as a top-tier auditing firm in the area. With her extensive experience and deep knowledge of the industry, she continues to be an inspiration to her colleagues and a driving force behind the firm’s continued growth and success.
Why did you decide to run your firm? After several years as a Partner in a well-known consulting firm, I decided to leave to fulfil my objectives. Unfortunately, I needed more support to grow and consolidate the firm’s future, so I founded my own company. At that time, becoming part of the Iberaudit project had already been proposed to me, so I decided to join the two projects and create a firm in which quality was the central pillar and with international projection, from here to our integration in Kreston. When it came to assuming the executive presidency, the only condition I set was to have the unanimous support of the entire team. I did not want obstacles; I wanted to be supported fully in my efforts to lead the company.
What qualities do you need to run a successful accounting firm? There are many qualities that one must have to run any company successfully. Having the capacity for resolution and determination in decision-making is vital. The ability to adapt is fundamental, especially in auditing, where change is part of our routine. The curiosity to learn about a subject and expand knowledge to other spheres allows us to acquire a global vision and anticipate possible events. Last, good communication is essential to improve negotiation through active listening and enthusiasm.
How do you support equality in your firm? As Executive President of the firm, I am actively involved in all issues related to equality in general, participating in the development of internal policies that ensure genuine equality of opportunities within our organization in all processes: selection, promotion, and development of our professionals- regardless of origin, gender, age, sexual orientation, and ideologies. I participate in mentoring projects for women and try by my example to be a reference for all the professionals in my firm. On the other hand, I continually propose team meetings to learn about problems and suggestions, and from these initiatives, I implement actions that contribute to equality.
We recently surveyed ‘interpreneurs’ – entrepreneurs looking to expand internationally. The data showed that female CEOs were more likely than males to consider expanding overseas. Why do you think this might be? Honestly, I wouldn’t just say it’s a gender issue, regardless of the results of the surveys. Instead, it is an entrepreneurial attitude—restless men and women who thirst for innovation. From my experience, after having been part of a prestigious auditing firm for more than 20 years, I understood that I had to take risks to improve and grow, and I believe that these actions speak of one of the entrepreneurial spirits that transcend gender. That entrepreneurial motivation gives us the courage to leave our comfort zone and take risks to grow, develop new businesses, and expand globally.
What advice would you give female entrepreneurs starting today, or would you give your 28-year-old self? The best advice I could give an entrepreneur starting today is to believe in herself, her goals, and her objectives. And that if she “falls, she should get up,” No matter how many times, you must persevere. All my work has paid off, and my efforts were worth it, but the most valuable thing that stands out is the experiences I have lived, which is the key to enjoying the road. Finally, I would advise you never to stop training, growing, innovating, and participating in congresses, meetings, and travelling; it is a vital learning process that allows you to analyse your surroundings in a more empathetic and global way that has helped me a lot, both personally and professionally.
To learn more about doing business with Iberaudit, click here.
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International Women’s Day: Erika Larsdotter Hed
8 March marks the annual celebration of International Women’s Day, dedicated to recognising the global achievements of women in social, economic, cultural, and political realms. It additionally serves as a reminder to take proactive measures towards promoting gender parity and empowering women. This year, Kreston Global has chosen to showcase several inspirational women from their network and gather their insights on what it means to be a prosperous woman within the organisation.
As the current CEO of Finnhammars Revisionsbyrå, a leading accounting firm based in Sweden, Erika Larsdotter Hed has played a crucial role in shaping the company’s reputation for excellence and dedication to customer service. Finnhammars was founded in 1983 to provide superior accounting services and build lasting client relationships. Today, the firm boasts 12 partners and a team of over 50 employees and continues to be known for its commitment to quality and personalised service. With her extensive experience and industry knowledge, Erika has been instrumental in the firm’s growth and success, having worked at Finnhammars for over 11 years. Her dedication to maintaining high standards and delivering exceptional results make her a valuable asset to the company and an inspiration to her colleagues.
Why did you decide to run your firm? It is an exciting challenge, and the firm has always been close to my heart, my family were even clients of the firm at one point. We have such a fantastic firm that from the very beginning put long-lasting relationships at its core, both clients, co-workers, suppliers etc. Something I am very proud of is that we have an average time of employment of nearly 15 years! It’s a lot of hard work and challenges for sure. However, to be able to be in a position where I can be a part of developing the firm is a huge motivating factor for me. We are now seeing a generational shift and I can contribute with leadership that suits the change in the organisation I am proud to be a part of representing and leading the firm into the next generation. I am also proud to, in some ways, be a representative for diversity which I firmly believe is something that creates an essential climate for sustainability.
What qualities do you need to run a successful accounting firm? Running a successful accounting firm requires a variety of skills. We have a fantastic team with strong technical expertise in accounting, tax, and auditing combined with business acumen. As I mentioned earlier, we put relationships at heart- we strive to be responsive to our client’s needs. I also see that being curious and willing to work to both maintain and develop the company’s culture is essential. A part of that includes looking at the bigger picture and to look ahead where a part of that is having an international perspective.
How do you support equality in your firm? We constantly work to recruit, attract, and retain strong female role models and it is going in the right direction. We strive to create a work environment that values diversity and encourages open communication, collaboration, and respect for different perspectives and opinions. We regularly review our policies and practices to ensure they align with our values of equality and inclusivity, but we still have work to do. Equality is a strategically important issue for the industry, and we, as well as many other firms in our industry, are struggling. The percentage of female partners in the accounting industry in Sweden is 29%. We can also see that 1% of all venture capital is invested in teams with only female partners. When you work in an environment with an unequal representation, it may not be as likely to see yourself as a partner in the long term, therefore it is our responsibility to emphasize that we see both women and men as future partners. We are proud to see a higher equal proportion when it comes to parental leave, where I believe we as a country have made some significant progress. You can roughly say that Swedish parents today get paid 80 % of their salaries up to 390 days and each parent has 90 of these days reserved for that person. We as a firm are seeing a more even distribution between the genders today compared to a decade ago. We as a business have a responsibility to our staff to combine private life with working life and a career in the auditing industry.
We recently surveyed ‘interpreneurs’ – entrepreneurs looking to expand internationally. The data showed that female CEOs were more likely than males to consider expanding overseas. Why do you think this might be? The survey showed a 3% difference between the genders but also a 38% difference between the age gaps 31-40 compared to 51 and older. I find it easier to explain the difference in age compared to the variable of gender considering we live in an internationalized world where technology, the internet and communications all facilitates expansion overseas.
What advice would you give female entrepreneurs starting today, or would you give your 28-year-old self? Be yourself and be brave and find your own path. Our differences are our strengths.
To learn more about doing business in Sweden, click here.
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International Women’s Day: Carmen Cojocaru
International Women’s Day is celebrated annually on 8 March to recognise women’s worldwide social, economic, cultural, and political achievements. It also serves as a call to action to accelerate gender equality and women’s empowerment. This year, Kreston Global will showcase some inspiring women across the network and get their insights on what it means to be a successful woman in the industry.
Meet Carmen Cojocaru, a highly experienced professional in accounting, business process outsourcing, audit, and tax. As a certified accountant, financial auditor, and tax advisor, Carmen has amassed over 20 years of experience in the industry, making her a valuable asset to Kreston Romania, where she currently serves as the Managing Partner. Carmen’s journey in the accounting and tax field started in the early 90s, working for an Italian firm and later joining BG Conta SRL, which eventually became Kreston Romania. Since then, she has risen, becoming the manager in 2006 and the Audit and Accounting Partner in 2008. Carmen’s expertise and leadership skills have allowed her to coordinate a team of professionals while actively attending and participating in international workshops and conferences.
Why did you decide to run your firm? I have always had determination and a clear goal to be my boss and a leader of wonderful people. It was the combination of willingness to have extra freedom, flexibility, and satisfaction. So I took a chance on the ambiguous circumstances and decided to convey it into opportunity.
What qualities do you need to run a successful accounting firm? To run a business, a person needs many qualities: communication and negotiation, delegation and time management, networking, problem-solving, and of course, financial management. It’s one thing to run the business and another to grow it; to do so, a person has to communicate effectively, learn, and strategise. One critical skill is the ability to learn and adapt continuously. Otherwise, the business owner is definitely going to miss more opportunities.
How do you support equality in your firm? Equality is about ensuring that every individual has an equal opportunity, which I always knew and believed. Kreston Romania has two partners- Eduard Pavel and me. Both have been working together before becoming partners, so for us, it’s just the essential pillar of how things get done. Therefore there has never been any prejudice associated with equality. We have excellent professionals with unique backgrounds and acknowledge that from the beginning of the hiring. We have created and encouraged a safe work environment where people behave however they want. At Kreston Romania, we had apprenticeship programs with participants from Georgia, Greece, and Brazil – a young generation with totally different cultural and professional backgrounds. One of them has been with us since the end of the program.
We recently surveyed ‘interpreneurs’ – entrepreneurs looking to expand internationally. The data showed that female CEOs were more likely than males to consider expanding overseas. Why do you think this might be? As I mentioned, running a business is different from growing a business. Suppose a business person detects the potential for extending business activities. In that case, there is a high chance that the person is backed up with relevant data and has support from other partners (if there is/are such) and the team members. There are many factors to consider. For example, being an entrepreneur means taking more or less calculated risks, and maybe surveyed ‘interpreneurs’ were such entrepreneurial females more in quantity? I can only talk about my example, and at Kreston Romania, both partners are involved fully by putting out insights into any activity that may benefit the firm.
There was a significant indication that existing networks were an attraction to overseas expansion in particular countries; why do you think female interpreneurs value this more than their male counterparts? Existing networks undoubtedly hold a competitive advantage, and even the fact that those networks are on the market today, successfully operating, clearly indicates that they know how to do business. Every business person wanting to ensure the risks associated with overseas expansion wants some guarantee and risk mitigation. Foreseeing barriers is another essential quality that a business person needs, and I am glad if, according to the data, we, females, have that power.
What advice would you give female entrepreneurs starting today, or would you give your 28-year-old self? Dare to dream and maximize your potential. As with every beginning, you need courage and a little madness. As W. Churchill said: “Success is not final; failure is not fatal: It is the courage to continue that counts!” So, develop a growth mindset and clearly understand that people are different in every sense; without acknowledging that, it is impossible to lead others. Say YES more than you think you should, but be cautious. Most importantly, ladies, you are mighty and can do wonders. So, make it happen! Let the world be your oyster in your desired colour, size, and shape.
To learn more about doing business in Romania, click here.
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Peschaud, France, Mozambique
March 2, 2023
Peschaud International specialises in oilfield logistics services in extreme conditions and environments (rivers, lagoons, deserts, swamps). Specialising in rig moves since 1956, Peschaud International is providing its added value in all regions where climatic or geographic conditions make prospecting particularly difficult to operate. The company aims to provide all-inclusive solutions, including a qualified workforce and specialized equipment to resolve all transport, lifting, handling and lodging matters in remote areas.
Peschaud has operated for over 70 years in African countries such as Gabon, Yemen, Madagascar, Sudan, and other difficult areas such as Chad, Congo, Myanmar, Tanzania, and also in the U.A.E. Peschaud owns a large fleet of floating equipment such as crew boats, landing crafts, barges, and a large fleet of onshore logistics equipment across the African continent. Most recently, Peschaud International created a Maritime entity specialising in offshore solutions and has acquired a shipyard in South Africa “Via Maris” where vessels are being internally designed, built and operated.
Kreston provides audit services for Peschaud through our French firm, Kreston Groupe Conseil Union, in Paris, led by Ali Smaili, and for its two subsidiaries in Mozambique which also require statutory auditing of their Financial Statements. Kreston Mozambique was invited to submit a proposal to audit the two subsidiaries – Peschaud Mozambique and Sociedade Moçambina de Cabotagem “SMC vi” our French firm, which was successful – we now also handle their corporate tax matters.
Kreston Global welcomes new member firm in Croatia
February 24, 2023
Kreston Global has welcomed new member firm Kreston Croatia (formerly LID Revizija) to the Kreston network. The firm, which was created in June 2022 and is based in Zagreb was founded by Managing Partner Ivan Pecur, who has worked in a number of international accountancy organisations including Grant Thornton and Crowe over the last 16 years as an Audit partner, the firm also comprises 2 other partners, Luka Orlović and Domagoj Bakran. Together they offer a mix of audit, accounting and tax services to businesses across Croatia, and in particular service clients in the ICT, Tourism and Leisure, Energy, FMCG/Retail, Production and Not-for-Profit sectors.
Ivan Pecur, Managing Partner at Kreston Croatia said: “Joining the Kreston network is a great opportunity for us to really help our clients to grow. The international reach across Europe and the world the network offers is of great interest to us and we are keen to become involved in the regional and global opportunities for collaboration it offers.”
Liza Robbins, Chief Executive of Kreston Global, said: “Kreston is really pleased to welcome our new Croatian firm which will be a great asset to our highly energetic Eastern European firms. We know many of our members have clients who are interested in this part of the world and having Kreston Croatia able to help and support them is a great advantage. We are looking forward to helping them connect with our members across the network.”
Kreston tax expert and regional tax director in the Kreston Global Tax Group, Jelle Bakker has accomplished many contributions in the area of international taxation over the past 35 years, including 10 years as Senior Tax Counsel with Global Network Bank.
Lithuania: introduction of windfall tax
February 22, 2023
Lithuania has introduced a windfall tax on surplus profits for the crude oil, natural gas, coal, and oil refining sectors. Lithuania has published Law XIV-1680 in the Official Gazette, which entered into force on 1 January 2023 and provides for the implementation of Regulation (EU) 2022/1854. This includes a solidarity contribution on surplus profits in the crude oil, natural gas, coal, and oil refining sectors that is equal to a rate of 33% on taxable profits in the tax year starting in 2023 to the extent exceeding 120% of the average taxable profits in the preceding four years, 2018 to 2021. The solidarity contribution applies to companies that generate at least 75% of their turnover during a taxation period in the fields of extraction, mining, petroleum refining, or production of coke oven products. The Law also provides for the introduction of a windfall tax on the revenue of electricity producers exceeding prescribed market rate caps that are to be set by the State Energy Regulatory Council. In general, the tax is imposed at a rate of 90% on the excess revenue, with certain exceptions including for smaller plants with an output of up to 1 megawatt.
If you would like to talk to one of our experts about the windfall tax in Lithuania, please get in touch.
News
Jelle R. Bakker
Partner International Tax at Bentacera, Kreston Global
Kreston tax expert and regional tax director in the Kreston Global Tax Group, Jelle Bakker has accomplished many contributions in the area of international taxation over the past 35 years, including 10 years as Senior Tax Counsel with Global Network Bank.
France and Colombia: new DTA signed
The double tax agreement, DTA , which France and Colombia signed came into force on January 1, 2023. When in force the DTA will include a 5% tax withholding rate for payments of dividends when the recipient holds at least 20% of the paying company, otherwise the rate will be 15%. The tax withholding rates for payment of interest will be 0%/10%. In the case of royalties, the withholding rate will be 10%.
To talk to one of our experts about this DTA in Colombia or France, please get in touch.
News
Jelle R. Bakker
Partner International Tax at Bentacera, Kreston Global
Kreston tax expert and regional tax director in the Kreston Global Tax Group, Jelle Bakker has accomplished many contributions in the area of international taxation over the past 35 years, including 10 years as Senior Tax Counsel with Global Network Bank.
Romania tax exemptions on profits reinvested
Investors will be pleased by recent Romanian tax exemptions on profits invested. Recently, the Minister of Finance Order 4636/2022 was published in the Official Gazette regarding the assets used in the production and processing activity and the assets representing refurbishment for which the reinvested profit tax exemption is applied, according to article 22 of Law no. 227/ 2015 regarding the Fiscal Code.
According to Ordinance no. 16/2022, the tax exemption of the profit invested is granted also for the assets used in the production and processing activity, the assets representing refurbishment, starting with 1 January 2023. Thus, starting from this date, the profit invested in technological equipment, assets used in the production and processing activity, assets representing refurbishment, electronic computers and peripheral equipment, machines and household, control and invoicing devices, in computer programs, as well as for the right to use computer programs, produced and/or purchased, including on the basis of financial leasing contracts, and put into operation, used for the purpose of carrying out the economic activity, is exempt from tax.
If you would like to speak to one of our experts about the tax exemptions you may qualify for in Romania, please contact us here.
Steve Gully is a highly experienced fiduciary and company director with over 20 years of experience in the international financial services industry. He has worked in companies that have undergone acquisition, acquisition of others and have been sold, demonstrating his adaptability and ability to cope with change. With a significant background working in an International Private Bank, Steve has developed detailed knowledge of the UK property markets for residential, commercial, agricultural, investment, and development projects.
Steve is also a proven leader with excellent people management skills, and strong commercial, technical, and solution-oriented skills. He has acted as a trusted advisor to a number of UHNW families and individuals and has held appointments as a board member on regulated financial services businesses, trading companies, and joint venture companies. His areas of expertise include Trust and Fiduciary Management, Wealth Management, Trust Law, Fiduciary Compliance, Family Office, Private Trust Companies, UHNWI/HNWI, Offshore structuring, Discretionary Management, Administration services, and Contentious Disputes.
Understanding the Non-Dom Regime and the 2023 UK Spring Budget
February 20, 2023
Understanding the non-dom regime is crucial to ensure you comply with the tax laws and avoid penalties. Kreston Global HNWI expert, Steve Gully, Director at Alex Picot Trust, discusses the non-dom regime, recent changes, and the impact of the 2023 UK Spring Budget on non-doms with eprivateclient. Read the full article here, or the summary below.
What is the Non-Dom Regime?
The non-dom regime is a tax system that applies to individuals who are not domiciled in the UK. Non-doms have to pay tax on their UK income and gains, but they are not taxed on their foreign income and gains if they do not bring them to the UK.
Non-Dom Remittance Basis
Non-doms can choose to pay tax on the remittance basis, which means they only pay tax on the income and gains they bring to the UK. This can be an advantage for non-doms who have significant income and gains outside the UK. However, they must pay an annual charge to use the remittance basis if they have been UK resident for more than seven years.
Recent Changes to the Non-Dom Regime
In 2017, the UK government introduced new rules that affect the non-dom regime. Under these rules, non-doms who have been resident in the UK for 15 out of the last 20 years must pay tax on their worldwide income and gains. In addition, non-doms who have a UK residential property in a company structure are also subject to inheritance tax.
Impact of the 2023 UK Spring Budget on Non-Doms
The 2023 UK Spring Budget introduced several changes that affect the non-dom regime. Firstly, the annual charge for non-doms who have been UK resident for more than seven years has increased from £30,000 to £60,000. Secondly, the threshold for paying tax on worldwide income and gains has been reduced from 15 out of the last 20 years to 10 out of the last 15 years. Thirdly, non-doms who have a UK residential property in a company structure will now be subject to capital gains tax when they sell the property.
Conclusion
Understanding the non-dom regime is crucial for individuals who are not domiciled in the UK. It is essential to comply with tax laws and avoid penalties. The recent changes introduced in the 2023 UK Spring Budget have significant implications for non-doms, and it is essential to seek professional advice to ensure you understand your tax obligations fully. Remember that the non-dom regime is complex, and the rules are continually changing, so it is crucial to keep up to date with the latest developments.
If you would like to speak to Steve Gully about any impact the changes in the Spring Budget have had on your investments, get in touch.
Global vacancies
Wasbeeklaan 3
February 14, 2023
News
February finance update from James Cowper Kreston
The latest James Cowper Kreston Finance Update newsletter for February 2023 is here.
The UK-based firm has released an easy-to-digest finance update newsletter, highlighting the key issues that affect businesses from the start of this year. In addition, it offers a helpful summary of the most recent economic developments in the United Kingdom, giving global readers the key headlines impacting businesses this month. Including insight on the energy support bill reductions and interest rates raised to the highest level in 14 years, the February financial update is a bite-sized version of the UK economic landscape.
There is also an opportunity to register for their upcoming seminar on Tuesday, 21 February. The free, 45-minute seminar, “Managing Businesses in Uncertain Times – Directors’ Responsibilities,” will welcome specialists to discuss what Business Directors should understand regarding their responsibilities and obligations and provide insight into how to mitigate risks they may face while navigating the UK’s challenging economy.
To find out more about James Cowper Kreston, click here. Click here to read the James Cowper Kreston newsletter in full.
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