Crafting Effective Financial Policies

The article titled “18 Best Practices For Crafting Effective Financial Policies” by the Forbes Finance Council discusses the crucial role financial leaders play in shaping organizational success through the review and revision of financial policies and procedures. The article compiles insights from Forbes Finance Council members, offering best practices to ensure that financial policies align with broader organizational objectives, promote compliance, and build trust among stakeholders.

Key best practices highlighted in the article include:

#1 – Include Stakeholders in Decisions:

Involve stakeholders in the decision-making process to enhance transparency and garner buy-in. – Rupert Lee-Browne, Caxton

#2 – Express Your Vision:

Articulate the vision behind new policies to engage and galvanize staff throughout the policy life cycle. – Dr. Jason Jackson, IBS Institutional Capital an IBS Investment Bank sister co.

#3 – Delegate When Necessary:

Encourage leadership to delegate responsibilities and share abundance, fostering a collaborative and giving environment. – Mark Troyer, Troyer Retirement

#4 – Create a Committed Environment for All:

Cultivate an environment committed to the success of all stakeholders by clearly communicating benefits and risks. Seek feedback, and providing necessary training. – Robbin Caruso, Prager Metis CPAs, LLC

#5 – Leverage Existing Compliance Practices:

Recognize the importance of existing compliance and control management processes. Reduce risk and empower organizational strategy. – Mike Whitmire, FloQast

#6 – Put Customers Top of Mind:

Prioritize customer-centric policies to build loyalty and long-term success by responding to customer feedback and enhancing their experience. – Luz Urrutia, Accion Opportunity Fund

#7 – Explain the Rationale:

Clearly explain the rationale behind policy changes, aligning them with company goals, regulatory requirements, and industry best practices. – Geanette Rodriguez-Ojeda, GRO Accounting and Tax

#8 – Provide Adequate Training:

Emphasize the importance of adequate training to ensure alignment, reduce mistakes, and facilitate smoother transitions. – Amanda Kristinat, Moonshot

#9 – Explain the Impacts to the Organization:

Communicate how financial policies impact the organization as a whole and connect them to departmental or project contributions.  – Christopher Foder, CExP, First Financial Group – Meridian Financial Associates

#10 – Be Aware of the Work for Administrators:

Consider the administrative burden on individuals affected by policies to enhance buy-in and compliance. – Aaron Spool, Eventus Advisory Group, LLC

#11 – Ask Stakeholders to Review Regularly:

Make key stakeholder reviews a recurring process, ensuring inclusivity and obtaining feedback for continuous improvement. – Michelle DeBella, JumpCloud

#12 – Avoid Jargon:

Use plain language and practical examples to make financial terminology easily understandable to a broad audience. – Sean Frank, Cloud Equity Group

#13 – Keep It Simple:

Simplify procedures to make them digestible and maintain alignment among stakeholders. – Nick Chandi, Forwardly

#14 – Get Employee Feedback:

Involve key stakeholders from each department to gather employee input and ensure practicality and alignment with organizational goals. – Anthony Georgiades, Innovating Capital

#15 – Provide Clear Communication Throughout the Process:

Prioritize transparent communication throughout the policy review and update process to build trust and encourage informed decision-making. – Jeffrey Bartel, Hamptons Group, LLC

#16 – Remove Excess Information:

Streamline financial procedures by eliminating unnecessary information, making them easier to execute and gaining buy-in. – Julie DeLong, Backyard Bookkeeper

#17 – Allow Employees Time to Adjust:

Give employees sufficient time and support to adapt to changes in financial policies, reducing frustration and ensuring effective adoption. – JD Morris, RHC 21 LLC (an SPE Fund) with family of Special Purpose Entities (SPE or SPV)

#18 – Be Transparent:

Ensure transparency in every policy, engaging team members in its formulation to demystify the process and promote ownership, understanding, and commitment among stakeholders. – Matt Johnner, BankLabs