The Evolving Roles of CFOs: From Bookkeeping to Key Business Partner

The accelerated pace of the information highway is just one trend that is changing the role of CFOs from backseat passengers to key drivers of a company’s strategy and operations.

There was a time not long ago when Chief Financial Officer just meant the person in charge of the accounting books. But those days have been drawing to a rapid close, with CFOs today often taking the role of one of the CEOs key business partners. While CFO may once have been a straightforward role of the number-crunching senior manager, now it can evolve to become that of a strategic business partner who may have their hands in every facet of the business.

Part of this could be due to the way the business world now seems to evolve and change faster than ever, with a constantly accelerated pace aided by the informational accessibility that technology provides. But a big part of the changing role of CFOs could be due to more advanced and detailed rules and regulations that have further separated a company’s financial and accounting functions.

Accounting is still about traditional bookkeeping, reporting, systems and controls. But the financial function has a much longer list of possible descriptions, including treasury, corporate development and raising capital. This is where the role of CFO begins to blend heavily with the role of CEO.

Many CFOs are even moving into overseeing business development, sales and supply chain management. Today, being a CFO means being a great strategist, risk manager, problem solver and analyst. CEOs expect their CFOs to offer valuable insight to help them run the business, solve problems and decide what direction to go in. Since a CFO position can be so many things, the person in the job needs to be flexible, adaptable and prepared to grow and respond well to change.

Great CFOs can collaborate with the CEO and influence them positively. Often, they need experience working outside corporate headquarters and learning as much as they can about different business units so they can have a rich perspective on the company as a whole.

A successful CFO will also have influence and credibility both inside and outside of the company. It’s about building strong relationships with a broad range of business partners, investors and key thought leadership. Building relationships also means that the CFO needs to be respected and known by their direct reports within an organization.

Even though a CFO must be well connected, they must also be independent and objective so their opinions count. CFOs are responsible for maintaining ethical standards and guarding good business practices. They need to be able to evaluate and manage the risks of corporate strategies so they can be a positive voice of reason.

If a CFO can maintain this balancing act as well as their chemistry with the CEO, they can become a CEO’s right-hand person. This means they may have the influence to change the course of an organization, whether it’s internally with smarter work patterns that drive performance or externally with business development. It may seem daunting for companies to develop or find this level of talent, but a great CFO is well worth the effort.

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