The 2021 Young CFO of the Year shares his recommended read: Principles, by Ray Dalio.
Being a finance leader comes with a lot of responsibility. Not only are they responsible for the strategic direction and financial health of an organisation, but CFOs also have to take care of the many teams that report into them. Oftentimes this requires them to improve on themselves as leaders, and to set a good example for their teams to follow.
For 2021 Young CFO of the Year Sheldon Friedericksen, reading Principles by Ray Dalio has helped him deliver on these responsibilities. “It demonstrates the power of leadership and giving clear direction through the use of guiding principles,” he says.
One of Sheldon’s favourite takeaways from the book is to “triangulate your view with believable people who are willing to disagree”. He explains that this is fundamental to decision-making, especially within the investment and risk spaces within a CFO’s mandate. “Checking your view of a situation, seeking advice, and surrounding yourself with people who will challenge you when required will ensure that any decision to deploy capital would be made through sound risk management techniques and limited blind spots. This helps to ensure that in all likelihood, you would not suffer loss, but generate an acceptable return on capital.”
When he is working in teams, Sheldon encourages freedom of thought and opinion to ensure that decisions do not happen in isolation, but rather together, so the team can all develop and learn from each other.
Another one of his takeaways from the book is that “pain and reflection equals progress”. He explains that: “No one is perfect, and as people – and especially qualified professionals – we need to learn, evolve and be adaptable in our approach to situations and the future.”
Sheldon adds that, while mistakes and errors are inevitable, and market circumstances can surprise you, the worst mistake any leader can make is not creating adequate time to truly reflect and understand what happened, identify what you missed, how you would do it differently, and – particularly important – why you missed it in the first place.
“This reflection time is critical to your personal and leadership development, and should not only be made available in times of pain, but should become a consistent ‘meeting’ in your week.”
Sheldon says that these takeaways have helped him work through some difficult decisions coming out of uncertain and unfamiliar situations. “They have enabled me to stay grounded, stick to the facts, be data led, and not repeat mistakes,” he concludes.