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45% of SMEs either don’t have a strategy, or one which covers only the next 12 months or less
Dubai: Most small-to-medium sized enterprises (SMEs) are aware of the benefits of good governance practice but, faced with limited time and resource, many still fail to put it in practice - which could be costly to long-term success.
How vision and strategy helps small businesses succeed is the latest in a global research programme supporting small business growth from ACCA (the Association of Chartered Certified Accountants) which was launched today at an event that brought together over 50 SME leaders in the UAE. The report outlines the governance needs of SMEs, where simple but effective practice over vision, strategy and human capital can provide them with greater flexibility, adaptability and resilience as they grow – a huge factor in the long-term sustainability of the business.
“If you incorporate good practice for running your business from an early stage, your company is more likely to be resilient and is more likely to appeal to external investment. Good governance is fundamental for all SMEs but more so in the UAE, where over 95% of businesses sit within this business segment” explains Lindsay Degouve de Nuncques, Head of ACCA Middle East at the event held in collaboration with Hawkamah and Deloitte Middle East. Dr Ashraf Gamal, CEO of Hawkamah institute for corporate governance further explained that there is a misconception that corporate governance is for large companies. “SMEs can benefit a lot from having good governance as it enhances their chances of being part of global supply chains and of creating business partnerships with large multinationals”, Dr Ashraf added.
The research also found that half (49%) of SMEs do not involve anyone external in their strategy discussions, despite the benefits experienced by those that do, which include additional experience and knowledge of the industry/sector (according to 46%), an independent perspective / constructive criticism (44%) and advice on their growth strategy (39%).
“There are a lot of daily concerns for the leaders of a small business, and often the biggest challenge is meeting day-to-day operations and cash management needs while thinking about the long-term future of the company. And while many leaders are keenly aware of the importance of resilience in the rapidly changing business environment and of buy-in from stakeholders, for example funders and employees, there often may not be the time to think or do much about it,” continued Lindsay.
“We hope that this research helps SMEs in focusing on some of the most crucial issues, and can be a resource not just to SMEs themselves but also to policymakers,” she concluded.
How vision and strategy helps small business succeed is available at
https://www.accaglobal.com/uk/en/professional-insights/risk/governance-needs-of-smes.html.
About ACCA
ACCA (the Association of Chartered Certified Accountants) is the global body for professional accountants, offering business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management.
ACCA supports its 208,000 members and 503,000 students in 179 countries, helping them to develop successful careers in accounting and business, with the skills required by employers. ACCA works through a network of 104 offices and centres and more than 7,300 Approved Employers worldwide, who provide high standards of employee learning and development. Through its public interest remit, ACCA promotes appropriate regulation of accounting and conducts relevant research to ensure accountancy continues to grow in reputation and influence.
ACCA is currently introducing major innovations to its flagship qualification to ensure its members and future members continue to be the most valued, up to date and sought-after accountancy professionals globally.
Founded in 1904, ACCA has consistently held unique core values: opportunity, diversity, innovation, integrity and accountability. More information is here: www.accaglobal.com
Contacts:
ACCA
Nav Dulay, +97143642139
middleeast@accaglobal.com
Twitter: @ACCANews
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