How tax leaders can increase their impact today and in their next role

Tax functions are pressured to deliver more value with fewer resources. Here are six actions for rising to the challenge — and succeeding.

In brief

• It’s more important than ever to get out of your silo to engage with other functions and communicate with them simply but effectively.
• A diverse, well-balanced team can deliver the technical knowledge that remains imperative. But soft skills are just as vital.

Today’s business environment filled with uncertainty and disruption has also complicated the career paths for tax professionals. The expectations for tax professionals seem to be rewritten every day — literally, in both tax regulations and emerging areas such as environmental, social and governance (ESG) topics, as well as what the C-suite demands from its tax leaders and the tax function as a whole.

How do chief tax executives thrive once they’ve achieved this milestone in their careers and position themselves for the next one? That was the question posed to Patrick Grismer, former CFO for Starbucks and other prominent consumer brands and now CFO Advisor in Residence at the EY Center for Executive Leadership, during the recent EY Tax Conference in Pebble Beach, California.

Pat drew upon his decades of experience to offer a road map for chief tax executives to navigate their careers through uncertain terrain — to strengthen their personal brand, build lasting professional relationships, and ultimately stay true to themselves and what they want to achieve. Here are six actions that he advises for maximizing the present opportunities and future possibilities.

1. Prioritize shareholder value creation through tax strategy

Compliance is a critical foundation for tax functions, but it can be used to achieve so much more. With thoughtful planning and an opportunistic mindset, chief tax executives can directly create meaningful shareholder value — oftentimes unlocking significant business opportunities that enable a company’s growth. This includes M&A transactions, where tax often makes the difference between a transaction that creates value and one that destroys it. This capability is somewhat unique to the tax function compared to other finance functions (which typically create value indirectly), and this “superpower” can help to create a strong bond between the head of tax and the CFO, while also elevating the image of the chief tax executive.

2. Give the CFO the confidence to focus elsewhere

Tax may be a company’s single largest cost line, but the CEO, the board of directors and investors, usually won’t want to spend a lot of time on it, as it is rarely a strategic concern. Make tax easy for CFOs, providing enough information so they have confidence that it’s all under control. But be ready to go deeper if they have questions, particularly with respect to articulating complex tax matters for the board and investors. And strike a balance between being too alarmist or too passive on potential tax issues. On earnings calls, CFOs will avoid discussing major misses on the tax line, so if your forecasts consistently miss the proper balance, you’ll risk losing credibility over time.

3. Avoid technical jargon

Tax legislation is notoriously complex and convoluted. And with so many acronyms, discussions can sometimes sound like reciting the alphabet in a different order. Nothing frustrates senior leaders more than to be spoken to in a language they don’t understand. Those who can act as a translator— simplifying concepts and communicating with clarity and succinctness — will deliver results not only for their companies but for their own career ambitions as well. Let your listener know that you’ve done the homework and can provide additional information by saying, “there is obviously much more detail and we’ve completed an appropriately rigorous review of the opportunities and risks, but here is the summary.”

4. Get out of your silo

Tax has business impacts well outside the finance function, stretching into public affairs, human resources, operations, supply chain, corporate development and beyond. Strive to work closely not just with the CFO but also the presidents of business units and the Chief Human Resource Officer in particular. Use these points of contact to raise your leadership visibility and build a network of advocates across the business, especially if you aspire to a leadership role beyond tax. Volunteer for responsibilities that elevate your personal image and demonstrate your initiative — for instance, as a thought leader in external events, M&A activity and debates on emerging legislation, and as an active participant in finance-wide events and company-sponsored community service activities.

5. Delegate

You’ve developed a vast amount of technical knowledge over your career, and it’s only natural that you remain involved in the associated responsibilities as you rise in an organization. However, you must relinquish control over much of it to your team — not only to “free you up” to focus on higher-level responsibilities, but also to develop the next generation of leaders, ultimately including your successor.  Importantly, this will also help to remove what could be a barrier to your career advancement, should you aspire to roles outside of tax.

6. Be open to possibilities — and enjoy the journey

Your professional growth is ultimately up to you. Don’t be afraid to show your ambition: if you aspire to do more than lead the tax function — such as becoming controller or CFO — let your supervisor and mentors know. In the meantime, consider horizontal moves or incremental responsibilities to expand your skill base and position yourself for broader leadership roles. And understand that your professional priorities must coexist with your personal goals: prioritize what’s important and be prepared to make trade-offs. It’s OK simply to be the very best tax leader you can be, if that’s what you want — and to leave a lasting legacy through the team and capabilities that you’ll develop while leading the function.