The changing role of the chief tax officer.

• Position: Discussion

The dizzying speed of technology, as software enables you to do your job not only quicker but more effectively. The expanding expectations of millennials, with their stated desire to better balance work and family. The burgeoning maze of regulations, with increasing government oversight. The globalization of the economy, as evidenced by our cover story on Latin America.

And, of course, social media.

These environmental factors are driving changes in all industries, and corporate tax is no exception. In March, we convened a conference call, moderated by Tax Executive Senior Editor Michael Levin-Epstein, to discuss the changing role of the chief tax officer. The participants in TEI's third roundtable were: Sandy Macfarlane, vice president and general tax counsel at Chevron Corp., who has been with the company for thirty-one years and has headed the tax department since 2010; Teri Wielenga, senior vice president of tax at Allergan, who has been with the company for twenty-two years and has been head of tax since 2001 (at the time this interview was conducted); and Jim Kennedy, senior vice president and chief tax officer at OppenheimerFunds, who has been head of tax for nine years.

Michael Levin-Epstein: How has the role of the chief tax officer changed in the past five to ten years?

Sandy Macfarlane: Several things have changed fairly significantly in recent years. One is the timing of what we do. With the advent of FIN 48 [Financial Accounting Standards Board's FASB Interpretation No. 48], now ASC 740 [Accounting for Uncertainty in Income Taxes], we have to come to closure on what our opinion is on the sustainability of our tax positions a lot earlier. It requires you to understand the transactions earlier, do the planning, and do your assessment of your likelihood of success at a much earlier time than in the old days. I think another thing that's changed is that tax is so much more in the news, and anything you do you may have to explain in The Wall Street Journal someday. That has an effect on how you think about things.

Teri Wielenga: I would say a couple of things from my perspective have changed. One is the amount of complexity we deal with today compared to ten or twenty years ago is really not even comparable. The international tax rules have continued to become more and more complex, not just in the United States, but across the globe--I think particularly what's going on in the OECD [Organisation for Economic Co-operation and Development] with the BEPS [base erosion and profit shifting] initiative. The other thing that's changed a lot, in addition to the complexity, is the extreme precision with which we need to deal with that complexity. Twenty years ago, your effective tax rate was much more of an estimate than it is today. With Sarbanes-Oxley, and Sandy mentioned FIN 48, there are so many more controls and so much more focus on how that calculation gets done. The precision that overlays the calculation is much more extensive than it was twenty years ago.

Jim Kennedy: I think when you ask the question "what has changed?" you have to keep in mind, "What really hasn't?" You have to continue to really know the business you're in, and of course, you have to be able to defend the work that you do against all scrutiny, whether it's management, regulatory, tax authorities, or business leaders you work with. But as far as the biggest difference, similar to what Sandy mentioned, I'd say is the immediacy, the accelerated pace of business. The change in the business environment, the laws that we deal with, and the operations of our companies--it really requires the ability to respond very quickly, if not immediately, with tax analysis. So I think that's important to keep in mind. I think there's an increased focus on the contributions as a business partner and finding ways to make the operations or strategies even more successful from an after-tax perspective. Not just "here's the lay of the land" or "you can't do this; you can't do that," but "here's how this strategy can be even better."

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