Sector Focus:Finance


Engaging customers is a key challenge O


ne-in-three businesses say customer engagement is the biggest challenge they face during Covid-19, with the finance


sector among the hardest hit. Since the outbreak of coronavirus, companies


across the globe have had to adapt to new ways of working and the difficulties that come with it. New data from Nottingham-based


telecommunications provider Esendex reveals customer engagement to be the biggest struggle faced by one in three businesses right now (37%) – rising to 42% for those in finance. Almost a quarter of firms


(24%) are experiencing reduced demand for their services or products, while 14% say safely managing their workforce is their biggest endeavour. The survey also highlighted the ways


of mass remote working, how to keep employees safe and how to keep customers engaged. “We also learned that half of the companies we


‘The statistics show just


how difficult the current climate is’


in which companies globally are dealing with the crisis – 40% have moved to remote working, while for 22% it’s “business as usual” with precautionary measures. When it comes to mass remote working, the


Communication is key, according to Amy Robinson of Esendex


education, finance and healthcare sectors have struggled the most – with 21% of finance companies stating this as their main Covid-19 challenge. Amy Robinson, Senior Brand Development Manager at Esendex, said: “The statistics show just how difficult the current climate is. “Business leaders have a lot to think about – how to stay operational, how to navigate the challenges


Paying shareholders leaves firms vulnerable


More than a quarter (28%) of FTSE 100 companies spent more on shareholder distributions than they generated in net income in their last available accounting year, according to new research led by the University of Sheffield. In the United States, for 37% of


S&P 500 firms shareholder payouts were higher than profits after interest and tax. The figure for S&P Europe 350 companies was 29%. On average, S&P 500 firms spent


87% of their net income on dividends and buybacks between 2009 and Sept 2019, while Euro Stoxx 600 companies paid out 72% of net profits between 2010-2018. The team of experts behind the


new report – from the University of Sheffield, Queen Mary, University of London, and Copenhagen Business School – said their findings demonstrated a desire within corporate management to maximise short-term shareholder payouts. They warned that company reserves have been ‘hollowed out’, leaving them more vulnerable to collapse in economic downturns. Professor Adam Leaver, Professor in Accounting and Society and


Director of the Centre for Research into Accounting and Finance in Context (CRAFiC) at Sheffield University Management School, said: “At first glance the Covid-19 pandemic could be understood as a classical ‘exogenous shock’: an event from outside the economic system that causes disruption and breakdown. But our report shows that management decisions over the last decade have made companies vulnerable. Their focus on short-term payouts is going to make the recession even deeper, costs to governments much larger, and will extend the need for central bank intervention. “A new contract between the


workforce, employers, investors and the state is needed, and it must put the social and moral purpose of the firm centre-stage. As we move towards climate-led volatility and disruption, we must think seriously about the agreements that must be forged and the sacrifices that must be made in order to build social and economic resilience to shocks, and enable our firms to work more effectively for a wider, more inclusive range of stakeholders.”


Summer 2020 CHAMBERconnect 63


surveyed are most likely to need SMS services for customer marketing and updates – rising to 62% in the finance sector. “The findings really highlight the fact that firms are having to tailor the ways in which they communicate to deliver high levels of customer service – whether that’s by email, text, social media or even WhatsApp.” The survey looked at struggles


faced by 350 businesses globally and the impact Covid-19 has had on their operations. Questions included “how is your business dealing with the Covid-19 outbreak?” and “what are your main challenges at the moment?” – with one in five companies revealing they have been forced to temporarily close.


Nigel Frith, Senior Financial Analyst at online


trading advisor AskTraders, added: “The pandemic has raised a lot of challenges for businesses in all sectors and it's no surprise that customer engagement has suffered as a result. “But while many financial institutions are


reporting engagement struggles in this study, the reality is that financial security is something everyone will be trying to protect in the coming months so the interactions the finance sector has with its customers are likely to increase rather than drop off.”


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