Even before the pandemic, the role of the CFO was evolving rapidly. Now, it’s more important than ever for businesses and finance professionals alike to embrace the modern CFO’s power as an empathetic and strategic partner, as Partners of our CFO & Finance Practice, Mark Craddock and Lynne Colgate explain.
How has the role of the CFO evolved in recent years?
Mark: There has never been a more exciting time to be a CFO. Twenty years ago, the finance director was more focussed on accounting, cash, and tax. . Fast-forward to today and the role of the CFO has never been broader, deeper, more commercial, and more important. In nine out of 10 companies they are the CEO’s natural deputy and business partner. Their role is to help set the vision and strategy of the organisation and ensure that it’s successfully executed – not just financially, but from a holistic business performance perspective.
Lynne: Today’s CFO needs to have the leadership and people skills to enable them to inspire and galvanise. They need to be able to assemble a team beneath them, motivate that team, and delegate efficiently. We’ve seen many more CFOs appoint strong deputies to run finance on the day-to-day level so that they can allocate the detail to others, freeing themselves up to partner the CEO and think strategically.
What other skills do CFOs need today?
Mark: One of the skills we’re seeing in high demand for both the interim and permanent CFO positions we cover is emotional intelligence. Interpersonal skills, not just IQ, are now essential. Of course, the modern CFO needs to be intellectually sharp but increasingly clients are saying “Yes, IQ is important but emotional intelligence is even more critical. It’s possible to learn new skills, our company, our sector, but softer skills are more difficult to teach.” The progressive CFO needs to have exceptional leadership and interpersonal skills.
Lynne: It’s also vital for CFOs to be storytellers, to be adept at engaging with their internal and external audience. A CEO needs the CFO to have those relationship-building skills and leadership qualities so people will trust them. Then, externally, when it comes to investors and analysts, the CFO needs to be able to bring the corporate narrative to life and engage with hearts as well as minds.
Mark: Rishi Sunak is an interesting example – and he is effectively the country’s CFO. As chancellor, he can talk with humility and authenticity – he’s a natural communicator, whether you agree with him or not. The need for these softer skills has been accelerated in the last year with employee well-being and the creation of an inclusive organisation both high on the agenda. As with all Board members, D&I will be part of the CFO’s remit and no longer sits neatly with the HR function.
What opportunities does the future hold for CFOs?
Mark: The CFO will continue to be even more involved in the setting of the strategy and vision. They will ensure that the business is future-proofed, that they create an inclusive culture with the right pipeline of talent as well as remaining commercially viable. The smart CFO will always turn the situation to their advantage and see opportunities for both saving and making money. Alongside this, another key opportunity for the CFO will be to understand and drive the ESG agenda for the business as this comes under more scrutiny in the coming months.
Lynne: Never before has the CFO been under a brighter spotlight, but this spotlight is an opportunity, a platform. Even CFOs of organisations that have been struggling are telling us that they are grateful for the lessons and the challenges that the last 12 months have given them. Their attitude is often “If I can get through that, I can get through anything.” This is a time of regrouping, of new beginnings and the voice of the CFO has never been more important. If you are a CFO with this attitude, you have a really exciting future.
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