When Omran Mostafa picked up the telephone to dial London, he was understandably anxious. The year was 1991. In 1990 Iraq had invaded Kuwait and the first Gulf War had brought instability and uncertainty to the Middle East. Omran Mostafa was waiting for important news from London and the war had done nothing to make its official transmission by post easier. In a world before e-mail, the Internet and Twitter, and with his future at stake and the information now available, Omran Mostafa decided to pluck up his courage and dial the London number. He gave his personal details. At first, things didn’t look good. ‘Very sorry, we are unable to provide this information on the telephone,’ came the answer. Omran Mostafa thought for a moment, and then explained. He was in Dubai. Communication was severely disrupted. What could he do? He must know. Surely they could tell him this?
In London, there was a long pause before the words came. Omran Mostafa held his breath. ‘You passed’, came the reply. The sigh of relief was audible, but from that moment Omran Mostafa, now managing director of one of the UAE’s biggest success stories, the Mostafa bin Abdullatif Group LLC, never looked back. He was on his way. He was a CIMA graduate.
In 2010, the Chartered Institute of Management Accountants (CIMA) celebrates its 91st anniversary. The institute was formed in March 1919 by a group of professionals who wanted to create a new approach to business financial accounting that would meet the particular commercial demands of a rapidly changing business world. Looking back at CIMA’s history, it is evident that what has driven, and still drives the institute more than anything else, is its focus on innovation. CIMA’s first president was Lord Leverhulme, the founder of the consumer goods giant, Unilever, and CIMA has retained close links with Unilever ever since.
Unilever’s world-class training programme for finance professionals incorporates the CIMA qualification and this alliance has produced many of today’s finance stars. These include: Andrew Higginson, chief executive officer of Tesco Retailing Services; Elmo de Alwis, CEO of leading Australian drug company Sigma Phamaceuticals; Ronnie Peiris, group FD of John Keells Holdings in Sri Lanka and CIMA’s current global president, Aubrey Joachim.
CIMA was originally named the Institute of Cost and Works Accountants. Cost accounting was not a new concept in the early 20th century but it lacked refinement and relevance to the business challenges following the First World War. The institute set out to develop scientific costing and to produce a new breed of accountant, which could analyse a business’s cost base and streamline its activities more profitably.
From this foundation, the institute has developed (and continues to develop) the role of the management accountant. For more than half its existence, CIMA’s work was almost entirely based in the industrial sector. But as this base declined in the 1970s and 1980s and new business sectors emerged, the institute continued to move with the times and adapt to the challenges emerging with each new decade.
One of the institute’s most symbolic events took place in 1972, when it changed its name from the Institute of Cost and Works Accountants to the Institute of Cost and Management Accountants. This formally confirmed the institute’s development from accountants working on the factory floor to accountants working as commercial business partners and playing an essential role in driving businesses towards greater success. 1986 was also a historic year from CIMA, when it gained its Royal Charter and changed its name to the Chartered Institute of Management Accountants.
A constant thread running through CIMA’s development is a commitment to quality rather than quantity. From its inception, CIMA has built its membership on the foundation of attracting and developing the best accountancy talent in the world. For this reason, the institute’s examination process has always been rigorous and only the most committed and the most talented survive the full journey to membership.
Thus, CIMA members are now known throughout the world for being in the top echelon of the accountancy profession. With its emphasis on both high-level strategic financial analysis and added value through innovation in application, it is unsurprising that not all can make it. There is a glittering prize for those who do, but it can be an anxious wait.
Independent research, recently carried out by Bath University’s respected School of Management in the UK, has confirmed that CIMA offers the most relevant and comprehensive professional qualification for global business. This research contrasted the CIMA syllabus, exams and business focus with eight other professional bodies and found that CIMA’s syllabus consistently provides more management accounting, more business strategy and more financial strategy than any of the other organisations. The institute qualification therefore provides an ideal springboard for those who aspire to be the business leaders of the future.
With its theme of constant innovation, the institute is the only professional accountancy body to update its syllabus every four years. CIMA collaborates closely with leading business figures globally to ensure that the syllabus remains relevant to the business community and that it moves with the times – however challenging they become.
Professional integrity and business ethics have a central focus in the qualification. The Institute believes that poor ethical standards have been key threads running through failed business management, from the Enron debacle in 2001 to the recent financial crisis, a problem best exemplified by banks lending money to customers who were clearly not in a position to repay. A sustainable economic future requires business leadership that is both ethical and fixed on a long-term, sustainable strategy. As CIMA’s current President, Aubrey Joachim notes, ‘What is the essence of a professional that sets him or her apart? If any single factor can be identified, surely it must be the capacity and the duty, if necessary, to act in accordance with our professional conscience, even when we know our advice may not be popular. We must retain our professional integrity in business life.
We must be prepared to tell the CEO and management when we believe their strategy may be flawed. Ultimately, we must, if necessary, be prepared to hear the words, “You’re fired”. Quite simply, this is a risk any professional must be prepared to accept. It goes with the territory.’ This central ethical credo is pivotal in CIMA’s training for business financial management. CIMA “talks the talk”. Its members are expected to “walk the walk”.’
CIMA continues to focus on innovation, and there have been a number of new developments in its anniversary year. Besides launching its new syllabus, it has also introduced CIMAsphere, an online community which has been designed to enhance core skills and encourage the exchange of ideas and knowledge. This is already proving to be a popular platform for sharing knowledge and ideas among the global community of management accountants.
In 2009 CIMA launched its Global Business Challenge. This is a competition designed to bring out the potential business leadership skills of university undergraduates around the world. The Challenge attracted teams from China, Hong Kong, the UK, Singapore, Malaysia, Ireland, India and Sri Lanka. It is truly inspiring to see so much talent in the global business pipeline.
To nurture this talent, the institute has created a new CIMA Asia Pacific Regional Board. This board’s remit is to support the development of high quality educational and professional qualifications in this region. Reinforcing this commitment, CIMA recently signed a Memorandum of Understanding with the Institut Akuntan Manajemen Indonesia. This agreement represents a significant collaboration at a time when there is an increasing need for international finance and management professionals in Indonesia and across the Asia-Pacific region.
Management accounting began in the UK to help British industrialists optimise the manufacturing process. But today, these skills and far more, are being delivered by CIMA members all over the world, in many different sectors and specialisms, from corporate social responsibility to risk management. Australia-based CIMA President, Aubrey Joachim, adds, ‘We can, and must, create and manage enterprise risk management frameworks which are effective in giving the whole picture of a company’s financial and risk management strategy, and which can be understood by management, shareholders, analysts and the wider business community. If in our businesses, we deal in complex financial instruments, these must be fully understood and ultimately distilled into key performance indicators in our companies’ strategic and operational plans. It is not good enough to go with the flow when times are good in the hope that risk management can be put off until tomorrow.’
The initiative provides a groundbreaking opportunity for East and West to share their expertise, and develop businesses that are fit for the 21st century – in other words organisations that are successful, sustainable and ethical.
The demand for more varied and detailed information is also increasing. Companies need finance people who are adept not only at evaluating current business activity, but also in modelling the future. The institute firmly believes that its members should be utilised as business partners who can use financial information to add strategic value to a company’s decision-making process. CIMA students and members enjoy support from the institute throughout their careers. The institute provides a comprehensive range of support services and tools for its students. Once qualified, members must follow a programme of continuing professional development to ensure that they keep up-to-date with legal and professional changes and innovations in their field. Today, with 172,000 students and members in 165 countries, CIMA provides the opportunity to become part of a global network of movers and shakers.
About the Author
Mr. Charles B. Tilley is the Chief Executive of CIMA. He is a regular commentator on a range of corporate governance issues, international standards, narrative reporting and strategic management issues concerning the profession and the Institute.