Coworking is a weekly segment where we talk to CFOs and others in the finance space about their experiences, their companies, and the larger economy. Let us know if you are—or you know—a CFO we should interview.
Sally Johnson is the CFO of Pearson, a global education company based in London. Best known for the textbooks it publishes, Pearson is aiming to rebrand as a lifelong learning company.
This interview has been lightly edited for length and clarity.
What does it mean to be a learning company?
A learning company is more about the things you learn and how you grow across your life. Whereas education feels a little bit more talking about school and maybe university. We are very much thinking about the different points across somebody’s life where they’re trying to learn. And one of our key strategic growth areas at the moment is our workforce business, recognizing that a lot of people need to and are choosing to learn while they’re working.
So whether that is just learning a little bit of English or a little bit of another language on a business trip, through to doing an MBA, it can be bite-sized, or it can be more substantial. It’s something that’s increasingly important for us as a business.
Most of your career has been with Pearson. How do you rise in the ranks of a finance organization?
Over 20 years, I’ve probably had 16 different roles. The thing I’ve been watchful for is, because I haven’t got the outside experiences of working in different businesses or cultures, I make sure that I get that feedback loop by being very externally focused myself, so whether that is talking to different people in the CFO community, or making sure I build my team from a very diverse point of view. Diversity is really important, but diversity of thinking and experience is also important as well.
In the finance world, we can get ourselves quite focused on the areas of finance that we think are particularly interesting. To be a really good CFO, you need to have a wide variety of experiences, partly in order to be able to push and challenge, all those good things. And to be able to balance that with all the governance things you need to be aware of as well. But partly also to have empathy for the different people in the different roles. If you’ve never worked in the commercial part of the business, you don’t understand what it’s like when a finance person tells you to go get your budget [in order]. Whereas if you’ve actually had that experience yourself, I think you can have more of an understanding as to the practicalities of what you’re asking for and what you’re pushing for.
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What are the conversations you’re having most right now? What’s top of mind?
I’m pretty sure it’s the same thing on everybody’s mind at the moment, which is a mix of inflationary pressures and an oncoming recession. I don’t think it’s surprising that we’re in an unprecedented time after the “unprecedented times” [pandemic]. Mix in that with a European war, and it’s not terribly surprising. The thing that our CFOs need to be very cognizant of is that history is probably not going to define what happens next.
Let me give you an example that’s particularly relevant to my business. What you have seen time and time again in history, in higher ed. When there’s a recession, people flock back to college. I don’t think we can assume that’s going to happen, especially when we seem to have a mix of rather unusually high inflation and a recessionary environment at the same time. We need to be really careful at the moment that we don’t assume history defines the future; we think about what’s likely to be different.
Everyone assumes that Pearson is counter-cyclical. I hear that a recession is good for us, and from a commercial point of view, that is often the case for us, but it’s not across the board, and therefore we need to think carefully in order to plan to make the most of what we do.
Is there a situation in your career that shaped you into the leader you are today?
I always remember a day when years and years ago, one of our systems had gone down in our payroll. Actually, within 24 hours it was fixed and it was back up and running. But I do remember that thought that I wasn’t going to be able to run my payroll, and we were going to have to do it all manually. I was going to have to…phone the CEO up and tell him he’s not going to get paid that month. The consequences of what you do and how unfortunate it is to people, I think really hit home with me then.—KT