How tax and finance functions can form a talent transformation roadmap

A new kind of talent health

Part of the solution is a new approach to measuring an organization’s talent health. In the past, organizations judged their talent health on metrics tied to length of tenure, organizational culture or recruitment numbers. With increased churn in the labor market, and willingness to quit, these types of measurements don’t always reflect the real-time status of a workforce.

Instead, the EY Work Reimagined Survey presented a measure of talent health that better tells the story of how an organization functions with labor churn, shifting skillsets and culture.

Tax and finance functions show an edge when it comes to talent health, a measure of employee satisfaction that results in employees promoting their employer to family and friends. They score 6 percentage points higher than average on this measure, demonstrating strength in the areas that feed into the measurement. For example, 67% of tax and finance professionals believe their work culture has improved in recent years with more work flexibility, above the average of 57%.

Tax and finance professionals also place more value on continuous learning and upskilling. Nearly two-thirds of respondents think it’s important to enhance their skills. In addition, those who strongly agree they have sufficient learning opportunities in their organization are 1.4 times more likely to be optimistic about productivity gains from GenAI. This optimism around efficiency and productivity gains from GenAI is rooted in practical use. Of tax and finance professionals, 83% say they are currently using GenAI tools, above the average of 75%.

The positive talent health doesn’t necessarily mean employees are more likely to stay with an employer, because there is no correlation between a high talent health score and a lower likelihood of employee attrition. Fundamentally, employees are more discerning and willing to change jobs to find a more fulfilling value proposition based on work conditions, total rewards and culture. High talent health is a way to measure how well an organization is channeling talent flow toward it.

Even with positive talent health, functions across businesses will need to manage the rational and emotional concerns of the workforce in response to the deployment of tools like GenAI and related upskilling and reskilling initiatives. Organizations need to be proactive in addressing potential anxiety connected to enterprise-scale change initiatives, what those changes mean for individual workers and workflows, and their effects on career pathways.

Still, the characteristics of high talent health for tax and finance may provide the basis for a necessary transformation to deal with demographic and technological disruption to the profession.

While tax and finance professionals — like the overall workforce — face myriad challenges, GenAI will be a key part of the search for future solutions. Jobs with GenAI will increasingly replace those without it, influencing what skills are needed to perform, how the work will change, and who might thrive in the transition.

The latest WEF Future of Jobs Report says workers can expect 39% of their existing skillsets will be transformed or outdated by 2030. AI and big data comprise the fastest-growing skills, but more insight can be gleaned from skills differentiating growing from declining jobs: resilience, flexibility and agility; resource management and operations; and technological literacy, among others.

Skills that can be complemented and augmented by GenAI, but not fully replaced, will be the most prized. For technical skills, the profession should work to create a baseline of technology training and technological literacy that moves beyond spreadsheet and database management. Because GenAI is more than just a search engine or information retrieval service, workers need to know how to ask more of the tools — engineer more complex and accurate prompts — to gain greater value.

Tax and finance professionals will also benefit from less tangible soft skills rooted in adaptation, including critical and creative thinking in addressing challenges. The tax function in particular is called to react swiftly and compliantly amid shifting geopolitics, rules and regulations, tariffs, and anything else influencing core business operations. The work is vital in managing known and unknown variables. The profession hasn’t yet leaned in to a broad reimagination of its talent pipeline with an eye on a more agile and innovative posture.

But the details around talent health for Tax and Finance may represent clues to the future blueprint for transformation.

Higher talent health for Tax and Finance is in part due to the profession’s cultivation of a growth mindset, anchored in adaptability and a willingness to embrace technology. The tax profession has been a leader in this area, especially with tools assisting with data classification and document summarization. Even with these efficiency gains, GenAI alone is not enough to transform a profession. Transformation depends on the people using the technology.

This means sometimes looking beyond traditional sources of talent. The “in demand” skills for the rest of this decade in many cases transcend sectors and role types. To find agile employees with technological literacy for GenAI and beyond it, leaders shouldn’t be confined to the traditional, shrinking talent pools.

Tax and finance functions have taken a first step in widening those pools.

The EY TFO Survey shows 62% of respondents say tax and finance employees without a university degree are “very” or “moderately” important to their talent strategy. Non-traditional hires can benefit from the profession’s willingness to adopt GenAI as connective tissue between industry knowledge and an employee’s ability to adapt, analyze and gain expertise more quickly. Prizing GenAI for its connective value will also be critical in the personalization of roles for today’s multigenerational workforce. 

Tax and finance professionals have reasons to look to the future with confidence, with an assist from GenAI, but success will rely on taking a holistic approach to transformation. A critical step will be aligning these mission-critical functions with broader workforce strategy.

Here are three areas of focus:

1. Embrace GenAI for talent transformation

• Tax perspective: Leverage GenAI tools to streamline compliance and regulatory processes, allowing tax professionals to focus on strategic advisory roles and enhance their value within the organization. By automating routine tasks, tax departments can reduce errors and improve efficiency, ultimately leading to more accurate and timely tax filings. The more businesses can free their tax professionals to work on highly specialized tax activities as they prefer, the better.
  
  
• HR perspective: Use GenAI to identify skill gaps and provide personalized learning paths for employees, facilitating access to continuous upskilling and adaptability to new technologies. This approach helps HR departments to better enable talent development, fostering a more agile and capable workforce that can quickly respond to changing business needs.

2. Foster a growth mindset and continuous learning

• Tax perspective: Building on your organization’s talent health, enhance and expand the necessary training and education that encourages a growth mindset and more innovative investment in learning and development. This continued proactive approach will encourage tax teams to stay ahead of industry trends and be well-equipped to handle complex tax issues.
  
  
• HR perspective: Promote a culture of continuous learning within the organization, offering training and development opportunities that align with the evolving needs of the workforce. By fostering a learning culture, HR can help employees to remain engaged and motivated, leading to higher retention rates and overall job satisfaction.

3. Expand talent pools with non-traditional hires

• Tax perspective: Broaden the talent pipeline by considering candidates without traditional qualifications but with strong analytical and technological skills, enhancing the diversity and adaptability of the Tax function. This approach can complement the specialized tax knowledge and tap into a wider range of expertise and perspectives, driving innovation and improving problem-solving capabilities.
  
  
• HR perspective: Implement inclusive hiring practices that value diverse backgrounds and experiences, ensuring a more dynamic and innovative workforce. By embracing diversity, HR can create a more inclusive work environment that fosters creativity and collaboration, ultimately leading to better business outcomes.

Tax and finance functions should innovate through disruption to shape future roles with confidence. By adopting these strategies, organizations can navigate the disruptive changes in the labor market and position themselves for long-term success.

Summary

Tax and finance functions must innovate their talent strategy through disruptions tied to demographic changes and labor market trends. The profession has an opportunity to leverage its strengths to build a future-focused talent pipeline through technological investment and implementation, upskilling and reskilling, and a more tailored employee value proposition.