Manager attending a conference call
Tax & AccountingFinanceComplianceJune 24, 2020

Stakeholder engagement during a global pandemic

During the last two years, the Wolters Kluwer Internal Audit organization has been developing and implementing a stakeholder engagement approach, outlining principles, desired outcomes, and success criteria. Those included points like having a formal, systemic, and cohesive program, transparent and honest conversations that build trust, active two-way communication, and sharing of meaningful insights that have an impact. We have been making good progress and a lot was done face-to-face as that seemed the most effective. Then, COVID-19 reared its ugly head.

Liaising with stakeholders is an ongoing responsibility of everyone in the internal audit team, and particularly of the CAE. In “normal” circumstances this would be a combination of regular calls, in-person meetings, and ad-hoc chance encounters anywhere in the world. Ever since COVID-19 spread across the globe, offices closed, travel ground to a halt, and over 95% of our workforce started working from home. Not much can be left to chance anymore. Whereas managing stakeholders always needs planning and thinking upfront, it’s even more so the case now. As mentioned, we created a stakeholder management approach a while ago, assigning team members to various stakeholder group categories. This has served us pretty well but it did not consider a pandemic. So what has changed for me, and the team? I’ve learned a few lessons in the last two months.

Team

Firstly, it’s about the team. That sounds obvious, but as I’d normally spend a significant amount of time talking with corporate and business stakeholders that seems to have flipped around and most of my contact is with my direct team colleagues. This may have been caused by the virtual nature of our work, but in times of uncertainty and hard-to-grasp changes internally and externally I have found it crucial to keep in very regular touch with the team. We have always been dispersed across the US and Europe but learning how everyone is coping with new work and home realities, what support may be needed, and how we all can work effectively in the new environment warrants this frequent interaction. As it happens, we just agreed on introducing agile ways of working in January and could immediately start with daily stand-ups for an audit we started in March.

We started weekly catch-ups as a team, more one-on-ones, accelerated and expanded the use of Microsoft Teams -including the use of video, where someone needs to start the video feed…thankfully Microsoft quickly installed a variety of backgrounds, and hairdressers reopened in the Netherlands recently - and committed to documenting-as-you-go in TeamMate+ so that all team members can see progress. Technology helps. It impacts our ways of working as internal auditors, but I will not consider a “bot” or an algorithm to be a stakeholder any time soon…auditing is still a people business, with virtual twists. I expect the regular one-on-ones to continue for the foreseeable future, and beyond.

Business

Secondly and unsurprisingly, it’s much harder to understand what’s going on in the business in the current situation. We have several key leadership forums (functional, cross-functional, enterprise-wide) where we participate, thus providing us with an opportunity to understand what’s happening around the businesses, and to offer our experience and insights. This has led to some interesting discussions that we’re following up on to see where we can support in an advisory or even non-audit capacity. For the rest, it’s really about keeping in touch with key individual stakeholders, but in a measured way. That still only covers the surface and a bit more, however, because we’re not speaking with people in the corridor/next to the coffee machine, visiting our entities across the globe, and having lunch with actual people, even this approach severely limits our ability to dive deeper into what’s going on, and building a connection. Lots and lots of phone/Teams calls as well as e-mails will only compensate partly for that, but I also understand that stakeholders across our global network will be less likely to engage virtually for longer than they may do in person. How much will depend on how strong your relationships were before the pandemic struck. That’s something to thoroughly reassess when the dust of the crisis settles. Having stated all of that, we have also continued with our amended audit work. This has gone rather smoothly, which I attribute largely to the strength of existing relationships and us having taken a measured approach.

Assurance Partners

Thirdly, I have found it easier to connect on key topics with other internal assurance providers, as well as with our external auditor. In a way, we’re all in the same situation and sharing experiences and thoughts with them about remote working, impact on the control environments across the enterprise, and how we all play our assurance and advisory roles, further strengthens our pre-existing relationships. It feels a bit more “open” though, anything can be discussed as we’re dealing with uncertainties and a lack of visibility. The question that we all are dealing with is how the operation and design of controls may have changed in the remote working environment and the impact this may have. We need to keep discussing this with our internal and external assurance partners, to pick up (early) signs, and share thoughts on this.

Board

Fourthly (although not necessarily from a priority perspective), it is obviously important to keep close to the Audit Committee and C-suite. I had the fortunate circumstance of two new Audit Committee members joining recently and used that opportunity to understand their perspectives (from their other organizations in particular), and link that to how we work. The Audit Committee meeting was held recently and it ensured no surprises. I also have regular catchups with the CFO to understand what’s going on across the business and to share our progress. I see divisional CFO’s as key stakeholders for Internal Audit and I am keeping in touch via one-on-ones, and by putting Internal Audit items on the agendas of senior finance management meetings. As a function, we need to stay on the radar and keep moving along with the business.

Colleagues

And finally, everybody I just wrote about are colleagues, but not necessarily direct “stakeholders” in our formal plan. Gone are the coffee corner chats or spontaneous catchups over lunch or in an office/corridor. It’s the social fabric of the office that is now lacking in our day-to-day routines, even for auditors who tend to be out and about more often than not. So, I have reached out to several of my “neighbors” in the office from where I work just to see how they are doing and will continue to do so until we can all meet again in person.

All in all, I do feel we’re behind on our plan for regular and meaningful engagement with stakeholders, but I guess so is almost everyone else. We are doing the best we can, and generally successfully. These are unprecedented times and we are all working very hard to keep the function operating at the right level and staying relevant. This requires perseverance, regular communication, and above all an empathic approach to deal with people across the business. Stakeholder or not.

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Peter Kruysifix, Vice President, Internal Audit
Vice President, Internal Audit
Peter joined Wolters Kluwer in March 2018 and is based in the global headquarters in Alphen aan den Rijn in the Netherlands. Peter is responsible for the global internal audit function.