The role of Chief Financial Officer has never been more complex than it is today. This is due to the fact that the CFO’s operating environment is typified by managing stringent regulation, and managing increasing shareholder scrutiny and economic uncertainty.
By Aarti Takoordeen, CFO at the JSE Limited
- This article originally appeared as a Word from the JSE in the first ever CFO Magazine, launched in May 2015. For more information on advertising and editorial opportunities in the November issue, click here.
Traditionally, the CFO's role has been to ensure fiscal prudence, financial analysis and reporting and risk mitigation. These skills and expectations are not obsolete; they are fundamental for any CFO. However, what will distinguish the future CEO and ensure that s/he retains their position will be the focus on not only on the fundamentals but lateral thinking and engagement with a variety of stakeholders.
Today's business environment demands the CFO to develop new sets of skills and competencies to drive organisational success and successfully execute company strategy. These skills and competencies can be summed up into four themes:
- Leveraging off a wider pool of talent
CFOs are beginning to recruit talent from beyond the profession of accountancy. To address complex business challenges, the CFO will need to recruit talent from a range of professions. For instance, CFOs increasingly rely on the expertise of IT professionals to manage finance reliance on new information technology. By leveraging off of a range and non-traditional of talents and expertise, today's CFO can to lead an organisation to optimise value for the benefit of its customers and other key stakeholders. - Adapting to digitisation
Technology has become an enabler of the growth of the financial services industry. Through technology, financial services have become more efficient by reducing human errors and speeding up the execution of traditional finance responsibilities to the benefit of organisations and our customers. Embracing digitisation ensures that we not only grow organisations, but also stay true to one of the key principles of accountancy that is risk management.What will distinguish the future CEO and ensure that s/he retains their position will be the focus on not only on the fundamentals but lateral thinking and engagement with a variety of stakeholders.
- Partnering with business
Today's CFO is called upon to assist in making more strategic decisions. By expanding ones network beyond the realm of the finance industry, CFO's are empowered to contribute meaningfully to organisations by providing
valuable insights and participate in strategic discussions and decisions. Business partnering combines the skills of financial expertise and business acumen to drive key decisions in organisations. In order to thrive in this complex operating environment, the success of a CFO will be determined not only by a focus on financial expertise but also on relationship building, collaboration and management. - Mentorship of up-and-coming CFOs
The opportunities in financial services are well known. Qualifying as a Charted Accountant is a requirement of any CFO of a listed entity. However, in order to develop a new breed of CFOs, we need to increase the amount of information on the various roles available across the spectrum of the financial services. It is crucial that we begin to expose young people and newly qualified accountants to the various career opportunities that financial services has to offer in public companies, asset management, equities, trading and research. As one of the most sophisticated financial markets on the continent, it is crucial that we ensure that we are promoting awareness of the dynamics of this industry to guarantee a solid pipeline of talent for future growth.
There is indeed more demand on the CFO in the current operating environment. By embracing some of these competencies, today's CFO will be better equipped to contribute meaningfully to company strategy and enable future growth for organisations.
- This article was previously published on page 9 of the first ever CFO Magazine (download pdf), launched in May 2015. The next issue is due out in November. If you want to advertise in the CFO Magazine or tell your story during an interview, please email [email protected].
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