Over the past two years, the American Chemical Society, its members, customers, and the larger chemistry enterprise have been gradually emerging from the Great Recession. The subsequent economic recovery has been slow by historic standards. Job growth has been extremely disappointing and unemployment remains at historically high levels. And as the recent congressional debate on the nation’s debt ceiling and deficit has shown, there are no simple or easy answers to our current fiscal problems, only difficult choices. What has become clear is our nation’s recovery from the recession will be measured in years, not quarters. Given this challenging economic backdrop, one could reasonably ask, “How can the American Chemical Society ensure its financial sustainability and growth?”
Beginning in the early 1970s, ACS has routinely undertaken periodic assessments of the society’s financial condition and near-term growth prospects. The assessments have typically occurred at financial planning conferences with active participation from both ACS governance and staff. In fact, the society’s contingency planning process and many of the financial guidelines and policies in place today have come directly from the planning conferences.
In June, the society continued this long-standing practice and held a financial planning conference in Baltimore. As chair of the ACS Board of Directors and chair of the Society Committee on Budget & Finance, we served as cochairs for the conference and are providing a brief report now. Invited participants included the ACS Board, the Budget & Finance Committee, representatives from the Governing Board for Publishing, and ACS senior management.
The conference theme centered on ensuring the society’s financial sustainability and growth in a period of extraordinary change. From reviewing and modifying the society’s current financial guidelines, to understanding the financial impact of the risks facing the society’s major revenue sources, to exploring ways to encourage chemical practitioners to join our society, the conference considered the challenges and opportunities for ACS to advance its mission while maintaining financial sustainability.
The conference kicked off with a plenary session focused on the future of the chemistry enterprise, followed by a robust discussion of this topic and the broader strategic environment in 2020. Additional conference topics included an assessment of the society’s financial position, a review of the appropriateness and adequacy of our financial guidelines, a discussion of the adequacy and effectiveness of program review, and an update on the near-term financial outlook for the society’s major revenue sources under various scenarios. ACS sources of revenue include the information services units Chemical Abstracts Service and ACS Publications, as well as membership (dues, meetings, professional development, etc.) and investments.
In subsequent breakout sessions, each group was asked to address a series of key questions and develop specific recommendations for consideration by all conference attendees.
In the end, a set of recommendations emerged from the breakout groups that will be presented to the ACS Board of Directors for its consideration and approval during the ACS national meeting in Denver. We believe the recommendations that emerged from this year’s conference will play a key role in setting the financial course for ACS during these challenging economic times.
Despite the recent capital market volatility, the Standard & Poor’s downgrade of U.S. debt, and the economic headwinds confronting the U.S. and Europe, we remain cautiously optimistic about the society’s financial prospects. In Denver, the Budget & Finance Committee and the board of directors will review the 2011 year-end projections for the society. The news is expected to be favorable, which reflects, in part, the board and staff’s strong commitment to fiscal responsibility and discipline.
As we move toward year-end 2011 and begin looking ahead to the uncharted waters of 2012 and beyond, it is important to acknowledge that the society is fortunate to have a solid strategic plan that guides our budgeting process and ensures that adequate resources are made available to achieve specific strategic and operational goals. The society is also fortunate to have thousands of volunteers and a highly professional and dedicated staff that supports ACS leadership in executing the many aspects of the strategic plan.
The financial planning conference represents just one of the many ways in which the ACS Board and the Budget & Finance Committee help ensure that the society maintains its financial sustainability and is well positioned to serve ACS members and the broader chemistry enterprise.