Public Affairs Professionals need to speak P&L
In today’s dynamic business landscape, the role of Public Affairs professionals is evolving and one thing I hear repeatedly is that there is a worrying gap that is becoming more and more evident – the lack of financial literacy among Public Affairs professionals. And by financial literacy I don’t just mean understanding numbers. It’s about grasping the fundamental language of business. Many Public Affairs professionals find themselves grappling with financial concepts, struggling to interpret balance sheets, income statements, or cash flow projections – and really get into the weeds of their business. How many of you know where your margins are made and what is critical to your business success? The answers to these questions have some serious consequences.
The core of this series of posts is about how Public Affairs initiatives should seamlessly align with the overarching goals of your business, and that includes financial objectives. So, without a solid understanding of financial metrics and how your Public Affairs work directly impacts the bottom line, Public Affairs professionals risk being disconnected from the core mission of their organization. It also means they will struggle to communicate in the key language that all businesses talk – Profit & Loss (P&L).
Consider this scenario: A Public Affairs campaign is launched to manage a crisis (we all recognize reactive Public Affairs work right). While the campaign might receive accolades for its creativity and messaging, its success ultimately hinges on its financial implications. Did it mitigate risks effectively? Did it create some financial opportunity? Did you understand and quantify the risks at the time? These are questions that demand financial acumen to answer comprehensively and also questions that need a financial objective and answer. You might have seen my previous posts on the need for Public Affairs functions to start quantifying their work – well this is where P&L literacy comes to the fore. Although not only here – speaking P&L cuts across much of a senior Public Affairs professional’s life.
To address this issue, investing in financial education for Public Affairs professionals is imperative – and (if possible) not just generic MBA style finance for business. Sit down with a GM for a day and go over everything from a to z. By equipping yourself with the necessary financial skills, you can be empowered to engage your business in a different way, find new and innovative ways to support your organization, demonstrate the value of your work in financial terms, and ultimately contribute more effectively to the overall success of the business (and thus your success).
Greater financial literacy also fosters better cross-functional collaboration (common language and all that). When Public Affairs professionals can speak the language of finance, they can bridge the gap between functions, align strategies, and foster a more cohesive organizational understanding of Public Affairs and what it contributes. In today’s fast-paced and competitive business environment, the intersection of Public Affairs and P&L is not just a nice to have – it’s becoming essential. How are you closing this gap? Share your stories and ideas so we can all learn together
