TEI Roundtable No. 32: Working and Managing Tax Departments Remotely

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Today, as a result of COVID-19, the words remote and virtual are omnipresent and ubiquitous. And, yes, those words are very familiar now to those who toil in the tax industry. As you know by now, TEI’s Annual Meeting this year was virtual, and, not surprisingly, one of the most lively and informative sessions was a roundtable discussion, “Working and Managing Tax Departments Remotely: Tax and Operational Considerations for the Business Enterprise.” We turned that discussion, in which knowledgeable tax professionals participated, into this issue’s roundtable. Those participants were Sharon Rosiak, tax technology director, strategic accounts, for Thomson Reuters; Jeffrey Friedman, partner with Eversheds Sutherland; Evan Croen, vice president, software, at Bloomberg Tax & Accounting; and Mark Walztoni, managing director of Crowe’s Human Capital Practice. Andy Doyle, partner at High Plains Advisors, moderated the discussion.

Andy Doyle: Our discussion today will be broken up into six sections: health and safety of employees; enabling a remote workforce; maintaining company culture and morale; leadership capabilities needed for now; tax department priorities; and finally, the future: Which of these changes are temporary, and which are more long-term or permanent? Our first topic is the health and safety of employees. Back when all of this began, and as cases [of COVID-19] began to spike—and as cases now begin to spike again—the health and safety of our employees is the first priority. And indeed, a survey taken by our own Mark Walztoni’s firm, Crowe, found that sixty-eight percent of employers believed health and safety of employees was their top concern. So, our first question goes to Sharon. Sharon, what were some of the early policies that your company implemented to protect employees and keep them safe?

Sharon Rosiak: This is a really good start. We saw travel restrictions in early March with guidance to use our judgment as far as making travel. What was really noteworthy was quickly announcing full support of authorities to help curtail the spread of the virus. We quickly spun up an internal website where we were able to have real-time COVID-19 updates, see information on office closures, working-from-home tips, and video trainings on best practices for working from home. Most importantly, the encouragement to look out for our health and our personal well-being. Q&A’s continue to be updated through today with questions and answers employees have. Updates are indicated in red. There were emails coming out this morning. I think first and foremost was really the safety of employees. I really commend Thomson Reuters for being so proactive with communication, especially in a time of such uncertainty.

Doyle: That’s great. Mark, as you’ve been consulting with companies, can you talk about some of the best practices you encountered with the health and safety of employees?

Mark Walztoni: Sure. Crowe announced a “virtual-first” policy within the first week, and we were no longer authorized to go to client sites. Partners told clients that, for safety reasons, we wouldn’t be traveling. All international travel was halted, and domestic travel required an approval from our COO, which, as you might imagine, made the approval queue a very small queue.

Doyle: That’s great. Evan, do you have anything to add on what Bloomberg did for its employees?

Evan Croen: It’s an interesting point. Bloomberg has such an in-the-office culture, but what was really spectacular to see from the firm was a real understanding that we needed to take pretty decisive action. So, I think, like everybody, there was frequent communications to start. There was the travel ending pretty abruptly, but what was great to see was the immediate shutdown once it became clear that there was community spread. What was really good to see also was not just the HR teams, but teams like IT and other departments you might not necessarily think about, step up to make sure that everybody could work remotely effectively, and they put in long hours to make it happen. It was a total team effort to really move to remote work. We’ve since started to talk about moving back and have some voluntary returns, and the efforts they put around that as well have been really something to see.

Doyle: Jeff, any final points to add?

Jeffrey Friedman: We have a real mixed bag. I mean, it’s been a “things have gone great, things have been awful” kind of a story. We made an office-by-office decision in my firm, so some offices were closed absolutely given local laws and rules, New York being an example. Certain offices we had a more flexible approach in other geographies, where those who wanted to volunteer could in fact go in, but they had to go through a process—you know how much everybody loves processes. We made a mandatory health certification app available. You had to also send an email message to the managing partner for that office to get his or her approval to come in, and you had to follow certain protocols, which I don’t think would be shocking to anybody, which included mask-wearing. Then I would say the psychological side, maybe, where there are certain partners in certain cities that really want to go in, and certain associates in certain cities really want to go in, and then there are other partners and other associates who don’t want to go in at all but feel kind of pressured, maybe, because certain colleagues are going in. So we had to deal with that in a very upfront way and make sure we’re very transparent and candidly repeating ourselves over and over again that there’s no expectation. In fact, there’s an expectation that you don’t go in. We don’t want people in the offices, irrespective of cities, but if you so choose to, you can do so, but don’t expect any of your colleagues to go in. That was the initial fallout that we’ve been pretty much living with ever since, although I expect it to be evolving in the coming months, Andy.

Doyle: Yeah, and I think that part is very important, that everybody is going to react to this very differently, and that we need to be cognizant of that as we try to move forward with the workplace. Mark, how can firms and leaders build remote-employee resiliency skills and mitigate potential health and safety issues, you know, more serious than just an uncomfortable caboose from an uncomfortable chair?

Resiliency Skills

Walztoni: Well, I wish that was the crisis we were solving—uncomfortable chairs. So why care about resiliency? Well, many health professionals have said there are really two pandemics. The first is a physical health pandemic, and the second is a mental health pandemic. The mental health pandemic is a trailing problem in that we don’t know the full impact, but in other ways like drug abuse and domestic violence it is already here. So, I’ll just talk about how Crowe is addressing these issues and practices I see at our clients and within the marketplace. I previously mentioned the “virtual-first” policy. We also classified each office from “completely closed” to “open with return-to-work protocols at each stage.” The other piece on the resiliency skills was interesting. We had a firm-wide partner and principal and director webcast with the CEO and a national speaker by the name of John O’Leary, who wrote the book On Fire: The 7 Choices to Ignite a Radically Inspired Life, and he had spoken at prior partner meetings. He was talking about resetting, redefining, and resurging. Something that was powerful about that message was—and I see this sometimes in the M&A world—the urge to use happy talk, you know, “It’s going to be fine. We’ll just bear down and get on with it,” basically, rather than to say upfront “This situation is big, and there’s going to be significant impact.” So, some process things, more feedback from pulse surveys, resources on the website for clients and also employees, but something else— and I’ll just close with this, Andy—that really impressed me was the authenticity of our CEO on that resiliency call, that authenticity is the antithesis of happy talk. And the head of our tax practice saying, “I didn’t expect when I’m a couple years from retirement to find Froot Loops in the backseat of my car, but we’re taking care of our grandchildren while their parents work, and those Froot Loops and car seats are here to stay.” So, I think there’s a process component, there is a safety component, and the authenticity acknowledged if it were OK to not feel good about what’s going on and recognize everyone needs to change.

Doyle: Absolutely, and I think that authenticity can help send out a signal that the things you’re feeling, we’re all feeling, and it’s OK to feel them, and that’s very important from a mental health perspective.

Rosiak: I think that Mark’s point is also very important. One of the things that Thomson Reuters did was to encourage thinking about the whole person, the family, and things like Froot Loops in the backseat. There was an additional nineteen days of paid time off just to take care of family things, to be used when you needed to use it. A lot of folks in the beginning needed to accommodate children not in school, taking care of parents, and just the fact that that puts an added stress on life. Just being able to give that time to employees to adjust to everything being remote and the world being turned upside down.

Croen: That’s something we really have pushed. One of the things, talking about paid time off, we’ve actually had to really push people to take vacation. One of the things we noticed—and I’m sure everybody has seen that, too—is we saw large balances of vacation days accruing and not being used. I think early days we all had sort of an acute safety concern; we didn’t really know what was happening, we didn’t know how it was spread. But since then, I think we’ve transitioned to more of a malaise, but we still have to watch out for burnout. So, one of the things we really do push is for people to take time off.

Friedman: It’s definitely been a universal issue across all businesses. I do want to pick up where Mark left off regarding that authenticity point. It’s one that I frankly have struggled with greatly. I really find myself kind of vacillating between being positive and optimistic and also being kind of realistic about what this is like and the lack of interpersonal engagement that a lot of us thrive on when we’re in the same conference room or in our offices or what have you.

I believe there is an authenticity problem if you smile and pretend that everything is business as usual when we all know that that’s not the case. But because I lead the tax practice group in the firm, I have to be careful not to dwell on the negative aspects of some of the challenges that our people are going through—particularly those folks that are home with small children; my heart really goes out to them. My kids are older now, not to say they don’t cause me to have gray hair, but it’s different than having little kids running around your house in addition to the dogs that we all have barking in the background and a doorbell ringing and the leaf blower from the neighbor across the street or what have you that we all are fending off. If I get too realistic, it could be a real downer. So, it’s a real challenge, I think, finding that place in the middle where you’re authentic in acknowledging some of the challenges that we’re dealing with, but at the same time expressing the true optimism that I think we all have. We all know we’re going to get through this, we all know things are going to be OK and we will get back to some sense of normalcy in the not-too-distant future. Hopefully it’s the first quarter of 2021; I see there’s some speculation in the chat regarding when certain vaccines are coming out. Hopefully it’ll be sooner rather than later—I think we can all agree on that. So, I hear you, Mark, I struggle with the authenticity.

Remote Workforce

Doyle: Moving on to the next topic, which is close to this: enabling a remote workforce. Mark, what are firms and leaders learning about how to manage a remote workforce? Building on first and foremost authenticity, but what other lessons?

Walztoni: The next step is just remembering the human connection. And just to be authentic, I recall in my own career a period where there were a lot of topics that were off-limits. But I think that paradigm has flipped, and that’s why face time and scheduling meetings with your team is so important, but not necessarily to fit your schedule. So, for example, I may like meetings from noon to one p.m., but for some of the folks that work with me, they may be feeding their kids or meeting with a teacher. A better alternative is asking the question, “What would be the best time for us to connect?” And it may be six p.m. after another caregiver is available. So, just some simple things to consider: Don’t schedule meetings for an hour; schedule them for fifty minutes, because your team needs ten minutes to transition to their next meeting. The other is getting team members involved in cross-functional or project teams. So, it might be a small group that might be helping with a department-wide issue or process that was on the back burner before to try to break down that “I’m working on an island” feeling. There’s also a trend of people turning off their cameras on calls is what I’m seeing, and it’s understandable—Zoom fatigue is real. On the other hand, seventy percent of the way that we react to people is visual cues, so without visual cues we miss information that’s helpful for us to know whether we’re actually landing with what we’re saying or hearing. So, even the simple step of asking for “cameras on” for some portions of meetings just to not miss that cue.

Doyle: Those are great. Putting it back to the panel, anyone have other thoughts to add?

Croen: I tend to think that in this situation the clarity of objective and mission is really important. Certainly having that face-to-face communication is key, but with everybody being remote, not in the same place and not having that sort of collaborative energy, it becomes even more paramount for everybody to understand why they’re doing things and what their impact is. Then, I tend to think from leadership, it’s also communicating down what is going on and how things are going. Because I find that’s what I’ve been seeing from our teams, but I’ve heard from others as well. There’s this real thirst for understanding where things are. Because there’s so much uncertainty in the world, they want to understand more about where they’re working—what’s happening, what’s going on, and what they should expect.

Rosiak: I totally agree with what you’re saying on that point, in actually both aspects. Perhaps even shorter meetings or fifteen-minute touch points where you’re just catching up. The kind of things that you do naturally in the office as you run into people or pop into their office are harder to do now, and just having a quick catch-up, a pop-in chat, that’s just saying, “Don’t worry if your children are coming in or asking you questions; that’s fine.” It’s just a chance to make that human connection and have that same policy where your colleagues can reach out to you and just say, “Hey, how’s it going?” It’s a virtual coffee break, to just check in and make that personal touch. You learn so much more in the informal conversations than you do sitting around a virtual conference table having a meeting or one-on-ones, because it is an informal, relaxed setting, and it will give you a good pulse on how folks are feeling and what kind of pressures they’re facing. And it’s kind of nice to see the children versus hear about them and see colleagues interacting with their children—they’re just precious moments, right?

Doyle: Absolutely. Before work from home, we had the toddler that ran in on the BBC interview, and now that happens once a week.

Walztoni: Every day is Bring Your Cat to Work Day [laughs].

Croen: We actually start all of our town halls and some of our weekly correspondence, we always put in sort of personal pictures of family and pets and all that, and it does add a little something.

Doyle: Jeff, what are the most important benefits of the remote work arrangements adopted by corporate tax departments specifically, and what are some of the key detriments and risks of this remote work?

Friedman: I think a lot of the benefits are obvious, like less commuting time. Everyone’s been very happy with not having to take mass transit or sit in D.C. traffic, or wherever you are—I’m D.C.-area, so there’s a lot of benefit from not commuting and the costs associated with that. We are also all working a lot longer, which is both a benefit and a detriment. And there’s more flexible scheduling; you can schedule now almost any time of day. But of course the detriment is pretty substantial, as the co-panelists were noting, that the day never really seems to end. It seems like it’s 24/7.

We can adopt some of the helpful ideas being shared in the chat, such as how we end meetings—I remember when I was a kid, TBS would start TV shows five minutes after the hour to allow people to adjust their station—doing little things like that, ending meetings early or planning gaps in the day is something that’s getting a lot of attention right now. So, block an hour or two on your calendar for mental health to take a walk, pet your dog, whatever you want to do. Let me just talk about communication, both beneficial and detrimental communication. I find right now—and I’d love to hear what our panelists have to say on this topic—it seems like so much of our communication is planned. It’s Zoom sessions, which I have a lot of thoughts to share on, or even old-fashioned conference calls that are scheduled. And there’s a lot less informal communication that you would get at the so-called water cooler, just chatting, or at the coffee station or whatever, or even just sending an email and following it up with a phone call. There’s just less informal communication. I view that as a huge detriment. I found some of the most helpful conversations, discussions, you have in a business day is the informal type that is not a scheduled call that’s prepared for with a PowerPoint presentation or an agenda. Those are important; don’t get me wrong. I have to do them, too, and I’m sure all of you do as well. But the informal communication falloff is the biggest detriment. By the way, just a last thought on it, Andy; I do random phone calls. The people that I work with have gotten accustomed to it, even some of my clients have gotten accustomed to it, where I just call. Believe it or not, it’s not scheduled; I just call somebody on my team randomly. “Oh, I haven’t spoken with Peter in a week. I’m going to call Peter,” and I’m going to specifically not talk about work. I’m just going to ask him about how he’s doing, how he’s feeling. Is there anything I can do for him? What is his weekend plan? That kind of stuff, just to have a little bit of informal communication back.

Doyle: That’s a great practice. Enabling a remote workforce and maintaining corporate company culture and morale are morphing into the same topic here. I’ll move along to that. Evan, how are companies keeping up team engagement and alignment while working from home? You heard some of what Jeff has been doing personally.

Croen: We’ve been doing a variety of different things. We’ve instituted and encouraged daily stand-ups. We are primarily a product development organization, and we’re trying to steal a little bit from some of the key practices in Agile, for example, about making sure that everybody is aligned at the beginning of the day. So, we do that within my team, but we also do it within each of the subsequent component teams as well. As I’ve said before, we’ve also done weekly emails, from both our BU [business unit] leadership as well as senior leadership. And we also continue to do quarterly town halls from both BU and also the overall business. I think what’s important, and we’ve seen this in surveys of corporate tax departments that we’ll talk about a little bit later, too, communication is the number one thing. People being aware of what’s going on and feeling like they have a say in what’s going on is super important. We’ve done other things, for example, flexible work arrangements are key; keeps people engaged, keeps people from burning out. We’ve tried to do informal social activities, like some have talked about here. We have a weekly coffee session where you literally just don’t talk about work, you talk about personal things. We’ve had happy hours. I think they’ve kind of fallen a little bit out of favor since the beginning—I think everybody’s sick of Zoom happy hours—but anything that really engenders human-to-human nonwork communication, because that, I think, like others have talked about here, that’s really lost. That informality, that communication and human-to-human touch is really important, and that has really been difficult to achieve. We’ve seen, and others have talked about this, too; initially, whenever anybody wants to talk to somebody, they book a thirty-minute meeting instead of just walking over like you would in a normal situation outside of COVID. I saw in the chat somewhere, it’s not helped by the default settings in Outlook, which I tend to agree with. I think all this talk about fifty-minute meetings and fifteen-minute meetings, it takes that little bit of extra effort in Outlook to set up, so that’s been a little bit of a challenge. What we’ve transitioned to—and I’m curious about the other panelists—because we’re in product and we’re a little bit more tech-oriented, we use things like Slack and Teams and have transitioned to chat and also one-to-one quick phone calls that are not scheduled, but are more sort of ad hoc. Like, a guy that I work with, if I really want to chat with him for a sec, instead of chatting or sending an email or setting up a meeting, I just call him on Slack, and it’s almost like I stopped by his desk. So, I’m curious what others have done along those lines.

Doyle: Let’s open that up to the panel; other thoughts from Sharon, Mark, or Jeff?

Rosiak: Yes, I’ve seen a lot of that, too, collaborating through Teams. Chat being used maybe in a different way—to have that quick reach-out to someone you haven’t seen for a while, just to have a quick chat on something that you might mention passing in the hallway, keeping that connection. Even if it’s reaching out because you have someone you want to consult with on a business issue, feeling that freedom to reach out to any level in the organization with a quick chat. Everyone is really using that as a communications tool, whereas you might have in the past scheduled an official meeting. Just reach out on chat and say, “Hey, you got a minute?” It enables communication and interaction, and a lot of times you get your quick answer a lot faster. This makes you more productive as you continue through your day.

Walztoni: I think it’s a positive with a downside. The positive is it’s very efficient. It’s also kind of like a knock on the door, right? Some name pops up, and then you can answer it or not answer it, so it actually feels very social. The risk is it can be the default to not make a phone call. But it is very efficient. We moved from instant messaging to Teams. COVID accelerated the implementation by about six months. The “knocking” feature, I think, is certainly very efficient, as long as we don’t make that a substitute for personal contact.

Friedman: I feel like we’ve done it all. We’ve done the chatting thing, the group chatting thing, the group Zoom sessions, both scheduled and kind of randomized. I like to do something cheesy that I think I victimized some of you with, which is I think it’s super important that we all get outside, so I like to take walks with people. I’ll actually call up people I work with, clients and colleagues, and put them on my phone in sometimes FaceTime or even Zoom and take a walk and talk. I can usually do both—not always, but I do my best—and just try to spend some one-on-one time on the phone. Because I do really believe—and by the way, I can’t say it enough—I hate working at home. OK, I said it [laughs]. Some people like it. My secretary loves it. We fight like every week about whether she could work at home or not, and she usually wins, and I usually lose. I hate working at home. I’m too distracted. I’m too lonely, honestly. I miss all you guys. I miss being at the conference right now and seeing you at the coffee urn and trying to pull you out of session to distract you. I miss all those things. So, whatever I can do to get that human connection going, which to me is much more accomplished via a phone call than texting, emailing, chatting, Zooming. I do notice, somebody said in the chat, that cameras are being turned off more and more. There’s a lot of Zoom fatigue. I know we’ll get into that some more as well. Then the other note is that some companies are scheduling meeting-free days, which I haven’t thought of before, but I’m going to steal that idea, and I’m going to suggest it in my firm. I know a lot of people are taking off on November 3 [Election Day in the United States], a lot of companies are closing on November 3, but that’s a great day to have a meeting-free day, or some other random Friday or what have you. Just see if you can clear all the decks and just have a day where it’s all spontaneous communication. “God forbid. Oh my God—we’re just going to talk to each other? Amazing.”

Exacerbated by the Pandemic

Doyle: Even before the pandemic there was a lot of discussion about the differences between millennials and non-millennials. In your experience, has that been exacerbated by the pandemic?

Croen: So, we have a team—I’m curious what you guys think—that skews younger. Our product people tend to be in their twenties to early thirties. We do have some people who are older than that as well, but I’ve seen a big divide in people who have children and those who don’t. I’ve seen a lot of different stressors with the younger employees, the millennials who previously lived in a two-bedroom with a roommate or something like that, or in a single. The stressors tend to be around being lonely or lacking human interaction, and that’s not something that I lack in my house with my two-year-old and my wife and a bunch of craziness that’s going on. But, you know, when you’re sitting by yourself in your apartment for months, I think it really starts to wear on you. So, I’ve seen a lot of millennials move back in with parents, move in with family, change their living situations. I’ve seen a lot of that.

Walztoni: We did a pulse survey recently and asked about returning to the office. The question was something along the lines of how comfortable would you feel returning to the office from a safety perspective, and how much do you want a return to the office, just from a work style, lifestyle perspective. Staff and senior staff overwhelmingly wanted to come back to the office, which is interesting, and managers and above a different story, but there was a real break. And the reasoning for that—some people tried to peel it back—was just that social element, being able to drop in and feeling part of something. To some extent I think this is a retention risk maybe coming out of this, too, is if you’re working at home and you don’t have human connection, well then, working for Firm A is not that much different from Firm B as long as you’re doing the same type of work. So, I think that’s maybe another driver to either return to the office, or maintain or increase that interactivity, simply because it’s not getting clear what company you work for essentially if you’re just kind of “head down and pencil up” on the work.

Friedman: A couple of things I wanted to call out from the chat. The challenge with onboarding has been a topic in our chat here. Boy, is that ever a challenge. I mean, I think it’s hard for people who have been working for a while, but for those that are just starting at a new organization and are trying to get a feel for the personalities and the flows and the expectations and all that stuff that’s not said that they usually observe in a work setting, it’s hard. Somebody had suggested using a mentor system; that sounds like a really good idea. Or more, again, kind of scheduled communications. I guess I wanted to touch on the opposite of that somewhat. What about those employees that are having performance issues, and maybe those performance issues preceded the pandemic, and you are working with that person to get them up to speed or to improve their performance, what have you. Having difficult conversations in this environment sucks. It sucks in person, but when you’re doing it on a Zoom call or on a phone call—to me, I always felt like somebody who would do that in the old world, that’s a cop-out. You really need to be, to the extent you can, across the desk, or better yet, sitting next to a person and talking with them about the challenges. But to coach via email, text, or even a Zoom call is a distant tenth place or something like that, but we have to do it now. You can’t stop coaching and helping people succeed and supporting them. It’s just so, so hard. Then the last point I wanted to call out from the chat is that somebody said, “Thank God for dogs.” And then somebody noted how they have guinea pigs, I think, for their sanity and maintaining company. So yeah, thank God for pets.

Doyle: It’s not only having difficult conversations performance-wise; there are firms that are conducting layoffs remotely. So, whereas somebody used to get called into an office, they were told they were losing their job, and they had all that decompression time before they got home and had to face the kids. In many instances, they’re all around the same table, doing schoolwork and what have you, and that employee gets the fateful call or video. So, definitely something that organizations really need to think through. I think that we’re going to see some changes as a result. But on this point on joining a company, trying to keep it a little more positive, Sharon, what are some of the things that you’ve seen for new employees to be invited into the culture and provided opportunities to build relationships that are key to a company’s culture that we used to be able to do, as we’ve been discussing, [by] just popping in and doing in person?

Rosiak: At Thomson Reuters, we have a good mix of virtual culture already combined with in-office, and I’m seeing some of the best practices that were used in that virtual culture being employed now with the new people joining, and that is really reaching out. When you’re working virtually, you need to really have that face-to-face connection with others in the company to get to know them. To build relationships in that first ninety days is really important for understanding the culture of the company and being able to figure out where you can really jump in and make that contribution. So, assigning a virtual mentor right away, someone who’s going to do things like make introductions to you for key members of the company, key executives, key people that are going to work on your team. Actually reaching out and setting up meetings for nothing more than to just meet people and talk to each other. Getting to know how the new person fits on the team, or getting to know key players, involving them in organizations within the company like diversity and inclusion groups, and also inviting them to a project—having them start right away, making them feel welcome, and allowing them to contribute even though they’re absorbing the culture. One of the key ways to really learn about a company is being involved in a team, in making a contribution, and being able to get those cues from others on the team as to what’s acceptable. How do I bring my ideas forward in a setting that’s new to me if I’ve never met anyone face-to-face? So, if you’ve done all of those introductions, encourage the person that you want the new person to meet to reach out to that new employee, set up that ten-, fifteen-minute chat or videoconference. Just to talk about themselves and also share more about yourself. I think that’s the closest we can maybe get in these times to really having that “stop by the office,” introduce the new person and allow them to talk and get to know you a little bit. We need to make an extra effort to reach out and have them feel included. I was thinking about the comment that just happened a few minutes ago about how every workplace could feel the same if it’s just heads down doing the work. We have to make an extra effort to help people feel included and allow them to reach out to us and build their virtual network until they have that opportunity to meet face-to-face.

Doyle: Let’s put it out to the panel. Any thoughts on how to better bring employees into our teams and workplaces while we are working virtually?

Walztoni: I think one of the risks, again, is a difference between efficiency and effectiveness. I think onboarding processes are efficient in the sense that they’re virtual, they’re systematized, etc. But effectiveness comes from the culture piece, and that’s the differentiator. And where organizations are leaving a legacy of who they are is by the way they respond to remote work, and how they treat people and anticipate some of the needs that people have. So I think while the process is efficient, there’s probably a default cultural orientation that’s important to pay attention to as well.

Doyle: Evan, how about Bloomberg?

Croen: We really push. We’ve hired a few different people in my organization since the start of the pandemic. Some have been transfers internally, so that’s been beneficial, because they already know the culture; they’re just changing teams. But I feel for the people who are totally new and in transition and haven’t met anybody in person. What I tend to think about is fighting as much as possible for normalcy for that person. Forcing them and forcing the team to spend fifteen minutes with them each, get to know everybody. It’s almost more important than pre-COVID, because there isn’t that informal, random interaction. You have to kind of force it. Then, the other thing, too, is for us, it’s easier to coordinate in-office. Shadowing—I like the idea of a mentor; that’s a great idea—but we tend to have a person shadow and bring them along and make sure they see how things work. Going along with sales calls, for example, is a key element. That’s the stuff that I really have to kind of keep the pressure on, and I tend to push my managers who are doing the hiring to really focus on it, because it’s easy to let that slip. It’s super essential to get value out of all employees and make sure they feel connected.

Doyle: Jeff, anything to add?

Friedman: Of course [laughs]. It’s really kind of an amalgamation of what’s been said before, which is kind of a combination of formal and informal tactics, I’ll call it. The maybe more formal mentorship, the more formal check-in calls, those kind of planned communications . . . but I actually think that the little things are just as important as the big things when it comes to creating a culture and a sense of team, and that is checking in randomly, like I noted before, and doing social things together even remotely. I know it’s contrived—I’m sure there’s going to be a lot of eye-rolling—but we do the happy hours and the wine-tasting stuff. There was a lot of restaurants that were closed, there was a lot of out-of-work sommeliers, so we had a sommelier dial into our call and give us a wine lesson and talk about that stuff, just so we have a common topic to talk about. It’s really a combination of all those things. There’s no perfect formula for any of this, but that’s what we’ve been doing.

Leadership and Corporate Culture

Doyle: A lot of the things that we’re talking about to maintain company culture [constitute] leadership. It is definitely a key to maintaining company culture and morale, the messaging that comes from the top. Mark Nevins, an executive coach to Fortune 100 CEOs, wrote in Forbes that emotional intelligence is even more important now than ever before. Not just listening, but empathy, which the panel has been talking a lot about, and particularly humor are very important. Throwing the next question to Sharon, what are some ways that leaders can create a more personal connection with their employees when working remotely? We’ve been talking about managers and their teams, but how about the most senior leadership of the organization?

Rosiak: We’ve talked about some of that throughout the course of this session. One is authenticity. Being in front of your global teams, especially at the highest levels of the organization, sharing with them what you’re doing. We were, I would say, fortunate to have a new top leader in Thomson Reuters at the beginning of this, our CEO, Steve Hasker. He has really gone sincerely and authentically forward with the employees through video meetings or chats where he’s spending time sharing about himself, also about things he sees with the company. But with that more authentic, genuine-type conversation that allows you to get to know him virtually and feel connected. I also see that with other senior-level organizational officers and executives—just that reach-out and having those town meetings. These are not the town meetings that I might be used to in the past, where you have the whole function assembled, the whole company, and it’s more formal. This is really more authentic, more genuine, almost like a fireside chat, and a conversation with you virtually—having the ability to put things in the chat like we’re doing now today, asking questions, having them addressed. And then new executive leaders that have joined the company having those same sessions, where he’s talking about them, introducing them, giving them that face time, talk time with the company. You feel like you’re getting to know the person maybe a little better than you would in a normal office environment with a large multinational company, where it’s not every day that you get to feel like you’re having a chat with the CEO or the new head of technology. I found that a plus to the whole COVID experience, really having what I feel like is more of a personal connection.

Doyle: That’s an interesting point. I think some of the best leaders are making such an effort to be accessible now that perhaps employees, particularly around the world, wouldn’t have had this opportunity to hear directly from the CEO before. Evan, I’d be particularly interested in what the Bloomberg leadership has been doing around this topic.

Croen: There’s been a variety of different things. I think we’ve been trying to rally the troops, make people feel like they’re part of a bigger cause a bit. There’s been some produced videos and internal messaging on how employees have really risen to the occasion and are serving their clients well. We have also had continued leadership communications. We’ve done some little vignettes of leaders in their homes and had them describe their home life and asked them questions about things that we might otherwise [not] have known about. For example, our CEO apparently really likes country music, which I would not have guessed; things like that break down the silos a bit. To me, I think what it comes down to, I love the word “authenticity” that’s been thrown around here. And I think that’s actually been a bit of a sorting out here, because I think challenges like COVID reveal character. I think the people really succeeding in this environment are the people who really do have empathy for their employees and truly do care, and it really shows through. So, I think having regular communications with people and really caring and listening to people’s concerns and issues, and sharing some of your own, that’s all necessary for personal connection.

Friedman: Two things. One is consistent with my co-panelists: communication. But ones focused on open-mic town halls. My firm does them; I know a lot of my clients are doing them. “Oh my God, it’s an open-mic town hall; everybody is going to be able to talk.” It’s a bit scary if you’re the one leading that kind of communication, which are usually pretty regularly scheduled, and it’s an opportunity for the people who are in leadership roles to share what they’re seeing and experiencing. More importantly, it’s an opportunity to listen. We don’t get too many opportunities in this environment to really listen to the people on our teams that are grinding out work across the country, and it’s a real opportunity for them to weigh in with their observations, with their questions. They ask the best questions. As you plan for these sessions, you find that the best material comes out of the questions being posed, not what you scripted in advance. So that’s one thing, the open-mic town halls. And the second one is, I call it—again, in the category of cheesy things that Jeff does—“It’s Just Lunch.” I stole it from somebody else [laughs]. It’s something out there. I schedule lunches with people, and I encourage other people in leadership positions to do the same in our firm and among my clients. Let me just share one really quick story. I scheduled It’s Just Lunch with another partner who I never work with—she does benefits tax work, which I don’t get involved in too often—and two associates, one an international tax associate and another one that does insurance tax work. One of the associates had a traumatic thing happen; his wife got very, very sick, ended up in the hospital with a rare disease. I had no idea, nor did anyone else in my firm, best I can tell, have any idea, because he was never provided a forum to share what’s going on in his life. When I asked him, “So, how you doing? What are you experiencing?,” he started telling me what was going on in his life; I was very sad to hear [it], but it was an amazing opportunity to hear what was going on with him and to get him resources and help and to let other people know what he’s going through and what his family is going through. So, I’m a big fan of that kind of very, I would call it, more intimate communication.


Doyle: Next question to Mark. Not all of us are the most senior leaders in our organization, so how should we change our expectations of leaders? We’re expecting them to have empathy; should there be empathy sent back up the other way?

Walztoni: Great point, Andy. I think today leadership happens up, down, and around an organization. It’s not a small team of leaders on top of a pyramid and everyone else along the base. Anyone can be a leader in this environment. And I think that the response to COVID is really going to make and break careers and companies. So, what were some of the pre-COVID causes of career derailment? Well, there are basically three: difficulty handling change; inability to work well in a team; and poor personal relationships. So, what could go wrong during COVID? A lot. I think that expectation of leadership up, down, and around the organization is important. I think also even thinking about what leadership skills are expiring, evolving, or emerging. For example, maybe a skill to be decisive and make decisions in some cultures might have been countercultural in a consensus culture or participative culture, but that may be the difference between the company pivoting when it needs to or having greater problems. Leadership skills that were important in the past may not work in this new environment. So again, there might be some things that in the past culture weren’t valued, like risk-taking. Risk-taking might have been practiced as avoiding or reducing risks rather than taking smart risks sooner. Also, developing and coaching leaders is more important now than ever.

Doyle: That makes sense. So, to the panel: yes, a trying time, and we will know very quickly whether our leaders are actually leaders in a crisis like this and are up to the task. To Mark’s point, this makes the development of our leaders and our high potentials even more important, because we still don’t know what a post-pandemic world is going to look like. Any thoughts on how this pandemic has changed the approach to developing leaders in your organizations?

Friedman: I’ve noticed that there’s two different kinds of leaders that you often see. This is a little bit of overgeneralization, of course, but you see leaders who are in leadership positions because they have really good leadership skills; they’re respected by their peers, they communicate well, they’re caring, they’re supportive. They know how to manage those kind of leadership tasks and obligations that are super important. And then you see another type of leader: a leader where somebody is really, really good at what they do. They may be a really good partner at a law firm or a really productive person in a corporate tax department, viewed as kind of an intellectual, or super productive or some combination of both, but they don’t always necessarily have the emotional intelligence that we were talking about earlier. I think that those people are super exposed now, because I think that as we’re in this environment where those emotional intelligence skills, the ability to connect to another human being in a remote environment, [are] really hard. It’s apparent that those folks that don’t have those skills or, in some cases, I fear to say, don’t even value those skills—they may even devalue those skills, view it as not important: “These are all grown adults. They should all be able to look out for themselves and figure things out just like I figured things out,” that kind of mentality. We’ve all seen it. Those leaders are exposed, and hopefully it’s an opportunity to thin the leadership ranks of those kind of folks.

Doyle: Evan, what have you seen in terms of changing priorities for tax departments as a result of the crisis?

Croen: I think what was interesting was that we saw a shift from system implementation to a focus on legislative and regulatory tracking and the changes that have happened. Obviously, with stimulus measures like the CARES Act and other regulations flowing through to address the coronavirus outbreak, that took on the number one challenge and focus of tax departments post-COVID, displacing implementation of new technologies and better technology and systems. This post- corona outbreak data point was really around April, and we’ve actually followed up since, and we’ll be releasing additional details in a follow-on report. Technology investment has really rebounded, but it’s clear that focus on government response is still essential. And as we’ll talk about, I’m sure, there’s really been a shift in expectations within departments that despite the new issues that have popped up and the increased demands on their time, that they will have to make do with either stagnant or potentially declining resources. This is a change from the beginning of the year, where there was an expectation that there would be some modest growth in tax departments. But that has obviously substantially changed, along with the rest of major corporate departments, which are also facing constraints on supply.

Doyle: Great. Let’s open it up to the panel. Jeff, what are your thoughts on changing priorities? Number one being strong internet and broadband, as we had a little blip there [laughs]. No matter what, I think that would be number one.

Friedman: You know, that’s funny. I’m sure there are a lot of people who have the same experience. I upgraded my home broadband when I started working from home, and I can’t tell you how many times I’ve been on a call where either someone’s talking while muted, the internet goes down for whatever reason, or someone’s mic is left open, only to hear something that they didn’t want everybody else to hear. It’s awesome [laughs]. Regarding tax department priorities, I have a whole bunch to say on this topic, and I’m going to do half of it here, Andy, and I’ll save the second half of it if you have time to come back to me. The first half of it is location of tax department personnel—and we have a robust chat going on about this topic, a more general topic about locating employees remotely. But what we’re seeing in the law firm industry, we used to be able to only hire folks where we have offices. Now we’re looking to hire people irrespective of geography, and I don’t think that’s going to change. I’m not sure what that looks like long-term, but I don’t think it’s going to change. As it relates to industry, same thing. A lot of companies are reconsidering whether they need to have everybody in a formalized campus. There’s that well-known story in Seattle where REI, I guess, is giving up its campus in Seattle, and others are considering likewise. Then that creates all these nice, interesting tax problems that I know have been covered elsewhere in the TEI agenda, but there’s a lot of good give-and-take going on in chat regarding whether it affects the company’s tax profile, if you have to now file more tax returns in more states, including withholding tax for those employees, but also all the corporate taxes, sales tax and income tax and the like, which is a great, great topic. The other thing I’ll get back to later are some of the things that tax departments are going to be facing when they interact with governments. I’ll bookmark that and come back to it later, Andy, if we have time.

Rosiak: I think those are all good points. Just kind of leveraging something I heard in the beginning, the focus has been on current affairs and keeping up with tax reform. Technology in and of itself has been put on hold, but there is an emergence that we’re seeing. All of those things are going to help facilitate that new normal of remote working, and I do agree it’s fascinating to see now where people can be located around the world and still contribute to a company. It really has changed the future of how we’re going to look at our workforce and really made global opportunities available to everyone. I agree with you; I don’t think it’s going to change, either. It’s actually going to be very exciting to see how it evolves.

Doyle: Jeff, can you talk more about this loss of revenue for the states, or windfall for the states in the case of New Hampshire, like you were just mentioning? I know, as someone who used to work in New York City and lives in New Jersey, New York’s always been very aggressive, and I’m sure they’re going to try to make me prove that I was actually in New Jersey all these days in 2020, which I have no idea how I’ll do. Can you talk some more about that issue?

Friedman: For sure. Andy, I don’t know if you knew this about me, but I grew up in New Jersey, and if you haven’t seen the new Bruce Springsteen concert on Apple TV, you have to watch it. It is absolutely amazing. Everybody needs to watch this Springsteen special on Apple TV. He looks amazing, too, by the way. OK. So, what do we expect to happen? Again, Captain Obvious here. We’re expecting three things from the states: increase existing taxes. So, we saw New Jersey already pop up their corporate income tax rate with their surcharge, surprise surprise. Second thing: states adopting new taxes, new novel taxes. So, we saw Maryland pass a digital advertising tax, only to have the governor veto the digital advertising tax, and we’re all expecting that veto to be overridden in January. So, that’s the second thing. The third thing: enhanced enforcement. Again, Captain Obvious here. We’ll see more aggressive auditors. I like to tell this little story: Wisconsin years ago had a very, very conservative Republican governor who ran for president, and he was an anti-tax person. What wasn’t necessarily discussed in the press was the fact that he hired an additional 100 state auditors to audit all of you—out-of-state companies. Wisconsin as a result for years now has been a more aggressive state in enforcement. So, we’ll see likely more aggressive enforcement tactics. There are two things in the chat I just wanted to quickly mention: Marji Gordon-Brown noted that companies are using electronic signatures, and some states have been cagey either by not being responsive or saying that they’re not going to accept electronic signatures. Well, too bad. Normally, if it was just a couple of us talking, I would have inserted an adjective there. Too bad. We’re going to use electronic signatures, because no one is going to go into their office just to sign returns these days. I know some people are, but a lot of people are not going into the office to sign returns when you can easily use DocuSign or something like that to sign returns. And then the second thing is this remote-employee issue that I think is a huge issue. We are going to see litigation against New York with their convenience-of-the-employer rule. It was discussed in a panel yesterday where the New York department issued a frequently asked question saying that yes, if you live in New Jersey, Andy, but you work in New York, but you can’t go to your New York office because there’s a pandemic, and, in fact, it may even be against the law for you to go to New York to work, we’re still going to tax you.

Doyle: Well, Jeff, you are certainly getting a lot of love on the chat, and we are starting to run a little short of time. I’m going to move on to the next topic. The first question is for you. What long-term impact may the pandemic have on the size, skills, and locations of corporate tax departments? You brought up the REI example that we all saw over the summer. How do you think that’s going to affect both how we staff the tax department and how it strategizes?

Friedman: Just a couple thoughts there. There’s no doubt that technology is going to be more and more important, undoubtedly. If I was in that technology tax space like some of my co-panelists are, I’d be very excited about what the future holds, because I think tax departments are going to be much more interested in deploying technology, including document management systems and the like, which are not always compatible with our firm-provided software. We have a long way to go, both in firms and in corporate tax departments, about putting up protocols and expectations regarding how to use technology, what is allowable, what is not allowable, how to make a home computer work for your business so that it is secure. I see a lot of discussion and movement in deploying greater technology skills. And then the location of the tax department is going to be more dispersed; there’s no doubt about it. You’ll see companies hiring tax professionals in places they hadn’t done so before—not in every case, but in a lot of cases.

Doyle: Let’s go out to the panel. Other long-term impacts on tax departments specifically as we come out of the pandemic? What things were temporary, and what indeed may be here to stay?

Croen: Just picking up on what Jeff was talking about, I think technology is going to be a big element of the future. I think what we’re seeing is a focus on efficiencies and reduced spend in corporate cost centers. One of the ways that I think that will play out, something that we’re seeing—and I’m sure Sharon is seeing as well from the Thomson Reuters side—is increased investment in automation, in technology, in software that reduces the burden of manual work or activities that are inefficient. My hope is that that will then enable the tax department and other related groups to be more strategic and to play a broader role in the organization by freeing them up from some of that drudgery and that manual work. We’ll see how things shake out over the next year or two, and how quickly we snap back—or whether we do—to a sort of pre-COVID situation.

Rosiak: I would agree with that as well, and you’re right with regard to technology, I’m seeing the same thing. I think one of the big “ahas” was having collaboration tools. These were often seen as a “nice to have” when the person that you were working with was in the office next door or just down the hall. That no longer exists. Being able to really fully do things in a collaborative way, in a virtual way, and have access to the resources—if anything, I can see that this is springboarding the need to have that, whether you’re working in the office or whether you’re working remotely, because I believe that having teams situated in both of those instances will go on into the future. Perhaps this is going to allow some of the resistance to a virtual workforce to go away in the future, some of the concerns. I think we’ve all proved you can be very efficient, effective, and do world-class work remotely, run the company and continue to move forward with your business plan remotely.

Walztoni: And I think that’s also true from a technology standpoint. We talked about resiliency earlier. Perhaps the prior standard for performance for being effective was adopting technology preferably early, whereas now it is being technology fluent. New technology options and adoption fluency is here to stay.

Doyle: We have a few minutes left in our session. Any predictions on what you think will happen post-pandemic in terms of the workforce. Jeff?

Friedman: I’m glad you didn’t ask me about my election predictions; I was nervous [laughs]. I don’t have one, so it’s all good. There’s a couple things I wanted to call out in the chat regarding using electronic notaries. It’s been a real problem getting returns filed, and there was also a note that local government’s a particular disaster. And then the third thing I wanted to call out is that there’s been a good discussion here about what companies are using for document management and switching from a paper environment to an electronic environment. Note to Eli [Dicker], who I know is listening, this would be a good topic to add to a future TEI conference about best practices and document management in the remote world. I am optimistic, to get to your question, Andy. I’m optimistic that we’re going to have—and you have to start here, I think, in terms of what the future looks like. My future looks like a vaccine approved in November-December timeframe and deployed in the first and second quarter of 2021. I don’t think it’s going to be an on-off switch, although I don’t think anybody thinks that. There’ll be a gradual movement back to work in 2021, and by the end of 2021, it’ll end up in this hybrid kind of environment that a lot of people are chatting about here, where there’ll be some people who go into the office every day, and there’ll be some people who work remotely full-time, and then there’ll be a lot of people in the middle who will do some combination of working from home and going into the office. Maybe that’s what the foreseeable future looks like. You could probably guess where I’m going to fall out. The last thing I wanted to note, Andy, before I drop the mic is that there are a lot of regional differences going on, and I know we all see this, but this is a good place to kind of raise it, since this is a big national conference with 411 people chatting. When I talk to my friends in Atlanta, and I talk to my friends in Seattle, I talk to my friends in New York—at least, I think they’re friends. Maybe they don’t think so—I think the cultural differences, like in Atlanta, there are a lot of people—I’m looking at you, Mitch—a lot of people are meeting for lunch in Atlanta. They’re doing social distancing, they’re being careful and responsible, but there’s a tendency to get together. And in other parts of the country, that would be taboo; that thought wouldn’t cross people’s minds right now to get together, even in a responsible way. You don’t see too much of that, including in D.C. So, I think we have to be kind of respectful and even appreciative of the local differences we’re seeing around the country and use them as opportunities to rethink our current practices, and I just wanted to call that out, Andy.

Doyle: Those are all good points. Evan, the final thought is yours.

Croen: I tend to agree with Jeff, certainly on the vaccine timing. Everything that I read is pointing me in that direction as well. I do think that we will see a transition toward more of an understanding of this hybrid approach that we’ve been talking about in terms of some people being remote, some people being on-site. I think it’ll play out differently for each company, though. I just go back to the internal culture at Bloomberg; it is very focused on in-office collaboration. We just built this very large office in London that is entirely designed to create random interactions between people, and I don’t think that we are going to be quick to give that up. I tend to think more broadly; we will see a shift more to a hybrid approach, but it’ll be interesting to see on a company-by-company basis what really shakes out.

Doyle: So, that is it. We are at time. I’d like to thank our panelists for their insights and thoughts. I’d like to thank Eli Dicker for his behind-the-scenes counsel on the run of show, our engineer for making sure that everything went off smoothly. And I’d like to thank all of you for your participation and engagement; the chat was running really strong. So, here’s to hoping all of you stay safe and healthy and that the pandemic is over soon. Thank you very much.

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