ACCA: Public sector finance professionals seek a more radical future, but challenges lie ahead

12 September 2019

The public sector’s image as a place where little or no innovation happens is challenged in a global research report from ACCA, Innovation in public finance. Governments need to shift from the current dominance of incremental innovation to more radical reforms.

Recommendations for change

The top three findings in the report also offer recommendations for change:

1.    Public finance professionals believe that governments need to shift from the current dominance of incremental innovation to more radical forms of innovation.

This means that policymakers and public sector leaders should share a vision and strategic direction, allowing staff to understand how the organisation can proactively address the complex challenges it faces.

2.    The finance function has a critical role to play in the wider public sector innovation process.

Public finance professionals should apply the concepts of integrated thinking and value creation through multiple forms of ‘capital’ to help in the construction and assessment of business cases for innovation.

3.    It is through the power of connections that public finance functions will be able to realise fully the desired shift to more radical forms of innovation.

Public finance professionals should work with finance business partners to connect across the organisation and help shape a culture of innovation.

The report explains that there are three public sector specific challenges for radical innovation:

• Maintaining a stable environment while innovating – bringing new idea to life can be disruptive, and this is a risk for public services that often serve the most disadvantaged in society;
• First-mover disadvantage – where the public sector has the disadvantage of organisation-specific risk, combined with potential system-wide benefits;

And the challenge of diffusion and the need to spread innovation effectively – since innovation can often be context-specific and competitive forces do not comparably operate in the public sector to spur widespread adoption of successful innovations.

Full press release on ACCA

Full report, Innovation in public finance

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