For the past three decades, global corporations have been outsourcing their accounting work to South Asia. With US$177bn in outsourcing revenue in 2020 and a sector workforce of 11 million, India is by far the dominant player in the region, and is generally considered the world’s biggest outsourcing location. Yet it is by no means alone, with neighbours Pakistan and Sri Lanka also making a serious effort to raise their outsourcing profile. All three nations now have established shared services centres (SSCs), employing young accounting and finance professionals.
‘The sheer size of the skilled talent force in South Asia, especially in India, remains a huge draw’
The interplay of technology, the Covid pandemic and the emergence of a new global class of tech-smart finance professionals has transformed long-held views of South Asia.
‘It’s not just the young population, the time zone advantage and a skilled talent force,’ says Suhel Goel, executive vice president at finance and accounting outsourcing business SandMartin in Delhi, although those three make for a strong hand for winning contracts from UK and US businesses in particular.
Sagar Ahuja FCCA, CEO at QX Accounting Services in Delhi, says: ‘The sheer size of the skilled talent force in South Asia, especially in India, with a population of 1.4 billion, undoubtedly remains a huge draw. The supply side is very strong in the long run. We have a working population of 400 million people, and the expectation is that about 15 million people aged 15 to 19 will enter India’s working population over the next decade,’
The contenders
Although Pakistan and Sri Lanka, with populations of 220 million and 22 million respectively, cannot compete with India in terms of employee numbers, both countries are holding their own as outsourcing locations, with sufficient talent pools. Aurangzaib Chawla FCCA, managing partner and financial accountant at Lanop Accountants, says the ‘advanced telecom and digital infrastructure, strong entrepreneurial and startup culture in Pakistan, and the number of successful startups’ reflect the positive business environment in the country, boosted among other things by government policies encouraging entrepreneurship.
'Young professionals can now stay in their hometown and work for a company based in another city or country'
The IT and business process management sector, which relies on young finance professionals, is also thriving in Sri Lanka. ‘It’s one of the few industries post-pandemic that is continuing to grow. The goal is to increase the talent pool from 115,000 to 200,000 by 2025,’ says Pehan Perinpanayagam ACCA, CEO of Infomate, which specialises in outsourced accounting services.
He adds that the sector is not standing still. ‘The industry is actively scaling up. We are working closely with accounting bodies and universities, making sure that we have a sufficient number of well trained talents.’
New kids on the block
Chawla says that such talents characterise the new class of young finance professionals in South Asia. ‘They have been around the world and educated, and want to work at a multinational company,’ he says. ‘They are also very adaptable and are looking ahead, motivated by the aim of launching themselves on the international scene. They expect to be working for an international firm, and the sky is the limit for them.’
Industry analysts point out another key characteristic of these finance professionals – their enthusiastic embrace of new technology. Goel says that such tech skills are easily available in India, Pakistan and Sri Lanka. ‘SSCs need people who are relatively young, agile and digital-savvy, who can adapt more quickly to what technology has in store. Digital savviness is the key word – it is going to be the gamechanger for the future.’
Anywhere workers
Since Covid, such adaptability has become especially useful for outsourcing and SSCs, according to analysts. Until recently, young finance professionals were traditionally tied to an office location. With the rise in remote working, they can now work from anywhere.
‘An accountant in Delhi goes to his hometown because of the lockdown and then receives a job offer at a company in Bangalore,’ explains Ahuja. He adds that businesses might never have previously considered taking on staff in a distant location, but, having seen that remote working works, they are now looking to poach the best talent wherever it may be. Young professionals can now stay in their hometown and work for a company based in another city, or even another country.’
‘We are getting involved in work at the top of the pyramid, focusing on high-end audit compliance for the UK and US and other markets’
Global village
Despite the pandemic-related uncertainty, Ahuja is optimistic about the opportunities it has created for business. ‘The world has truly shrunk into a global village because of Covid, and more people in different countries are connecting. Before, we had Teams and Zoom and other technology but nobody was actually using them. When Covid came along, the apprehension about working remotely disappeared. Working from home works.’
He adds that many organisations initially had a negative ‘knee-jerk’ response to home-working, and business slowed down for a while before bouncing back. ‘The landscape has changed entirely, and I think it will be a boon for outsourcing as more and more businesses embrace it.’
Up the value chain
Attitudes to outsourcing hubs are also changing, Ahuja says. ‘The baby boomers thought that outsourcing was not high-value. But we are getting involved in work at the top of the pyramid and doing things that are more technical, focusing on high-end audit compliance for the UK and US and other markets.’
Perinpanayagam is observing similar trends in Sri Lanka. ‘Today, outsourcing firms are gravitating towards much more high-end work, including management accounting.’
With all three countries boasting pools of finance talent in both quantities and at prices that can be matched by few others, as well as a widespread English-language culture that is particularly attractive to US and UK businesses, their outsourcing dreams may well come true.
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