The role of the chief financial officer is evolving with business leaders looking for those that can offer unique skills beyond financial reports and compliance.
In the past, CFOs crunched numbers, prepared financial reports and ensured that business processes were compliant. Of course, these tasks still fall under the finance leader’s purview, but the modern CFO is also expected to be a trusted adviser to the CEO and board, lead business strategy, and drive growth.
We recently spoke to several CEOs about the skills they value most in their CFOs. Here’s what they had to say:
Fundraising prowess
Private capital has changed the business landscape in recent years, with wealthy individuals and family offices emerging as new options beyond traditional bank finance. However, that doesn’t necessarily make finding and securing funding easy. To capture investor interest, businesses need to show an efficient sales model and strong revenue retention.
It may ultimately be the CEO who drives the investment strategy, but having a CFO who can lay the groundwork and use their experience to secure funding is a big plus. Being able to provide guidance on the process and drive discussions around the amount of capital that should be raised and how the company should structure a fundraising round is highly beneficial to any management team.
CFOs also have an important role to play in ensuring that business data is clear and well laid out for investors – the more confidence an investor has in a company’s financials, the more likely they are to offer favourable terms.
Ability to tell a compelling financial story
Whether communicating with investors, the board, or staff at an all-hands meeting, CEOs expect their CFOs to tell the company’s financial story in a clear, concise, and compelling fashion. It’s best to stick to three or four relevant KPIs and provide additional details on request – oftentimes, less is more when painting a financial picture.
From there, the financial story should be tailored to the experience, knowledge level, preferences, and interests of the people receiving the information. If the CFO can tell the story in a way that resonates with people and adds a human element to the facts, even better.
Proactivity and flexibility
CEOs want CFOs with the ability to plan for growth and the foresight to anticipate and prepare for possible financial setbacks. In addition, they want CFOs who can adapt their plans and strategies quickly. Scenario planning can help finance leaders gain these capabilities by enabling them to spot potential issues early and respond accordingly.
Successive macro-level events over the past few years have spurred businesses to expand the number of scenarios for which they plan. Replacing “two-month-planning-cycle thinking” with rapid strategy creation can help CFOs produce useful strategies quickly. In a volatile market, this will enable businesses to be nimble and prepared to make the right business decisions in the face of sudden shifts.
Tech-savviness
A core part of the CFO role is resource allocation, so it should come as no surprise that CEOs want CFOs who can understand the impact that new technology will have on businesses in terms of efficiency and ROI. The CIO will remain the expert of course, but finance leaders need to understand the capabilities offered by technology so they can ask the right questions when determining which investments make sense.
When it comes to technology investments, CFOs must strike the right balance. More technology is not always the right answer. Financial leaders must use their sharp analytical skills when assessing technologies to prevent a build-up of disparate systems that require numerous integrations and manual workarounds.
Calculated risk-taking
CEOs also want CFOs who can guide growth, balanced by a moderate appetite for risk. By providing insights and recommendations on how to grow the business, CFOs aid CEOs in the decision-making process and contribute to the overall strategic direction of the company.
The constantly evolving state of today’s business environment has prompted a redefinition of the CFO role. As such, cultivating skills such as fundraising prowess, strong communication, proactivity, tech-savviness, and calculated risk-taking can help CFOs go beyond business as usual and secure a successful financial future.
Scott Wilshire, vice president and general manager, Oracle NetSuite, ANZ
