Many CFOs are taking on responsibilities beyond traditional financial management: Half of the nearly 600 CFOs who responded to executive search firm Egon Zender's “Super CFO Survey” have taken on ESG and M&A responsibilities in the past two years. CFOs surveyed are also taking on cybersecurity, supply chain and human resources duties, but in smaller numbers.
What skills do CFOs need to fulfill their broad range of responsibilities? Arun Dhingra, global head of Egon Zehnder's CFO and audit chair practice, says the ability to think strategically is paramount. A strong grasp of risk management and the ability to confidently and persuasively communicate complex, long-term strategies to investors, board members and other stakeholders are also essential.
As CFOs take on a more strategic role, how do they balance their new responsibilities with their core financial oversight?
We believe prioritization is key to success: Finance leaders need to identify strategic initiatives that align with organizational goals and then spend time on those initiatives without neglecting fundamental finance tasks.
To make room for strategic thinking, CFOs should delegate aspects of financial oversight to trusted team members. Implementing robust financial management systems and automation can streamline mundane tasks, allowing them to focus more on time-consuming strategic responsibilities.
CFOs need time to decompress, too. It's encouraging to see that despite their increased responsibilities, most CFOs surveyed rated their work-life balance as “good” or “fair.” Taking time to recharge is essential to long-term success. Many CFOs also serve on the board of directors, adding another layer to their already busy jobs.
With an increasing number of CFOs aspiring to become CEOs, are there any experiences or areas of knowledge they should prioritise to prepare for the C-suite role?
With over 60% of CFOs hoping to become CEO, and 70% of those interested saying they're ready now, it's important to have two obvious skills: effective leadership and influence.
The best CFO candidates for CEO should also have extensive experience leading cross-functional teams and driving organizational change. CFOs surveyed said networking and visibility were the biggest skills gaps they saw between the CFO and CEO roles.
Openly communicating long-term goals to the current CEO and board of directors will go a long way in gaining the visibility needed. Understanding the broader industry and competitive environment is also essential, requiring CFOs to think outside of the finance department. CFOs are encouraged to develop a strong external network to broaden their strategic and operational perspective. If they want to have a smooth transition to CEO, CFOs should have already demonstrated a level of competency in the day-to-day CFO role.
The Super CFO survey shows that CFOs are in high demand, so what motivates them to stay with their company or pursue new opportunities?
CFOs have more opportunities than ever before, with 47% saying they are offered new roles every month. Interestingly, the survey showed that management team quality was rated significantly higher than compensation or market capitalization as the top factor that led CFOs to choose to pursue new opportunities.
To attract top finance talent, companies need to go beyond traditional compensation packages to offer more holistic benefits, including flexible working conditions, ongoing learning opportunities and clear career progression paths.
What are some innovative approaches to attracting, developing and retaining the best finance talent in this competitive market?
Emphasizing a culture of mentorship and empowerment helps attract high-caliber candidates who want to learn and grow quickly. When organizations can use advanced analytics to customize career development programs to meet individual aspirations, it demonstrates a true investment in the professional growth of their employees.
Additionally, provide open and honest feedback and inject talent into other parts of your finance department. The more you can expose your team to different parts of the business, the better your chances of developing a potential CFO successor.
