Is the Traditional CFO a Thing of the Past?

Is the Traditional CFO a Thing of the Past?

Even with a trend toward deregulation over the past few years, today’s regulatory environment for U.S. businesses can seem more complex than ever. Companies that don’t have finance managers or Chief Financial Officers (CFOs) can be at risk of running afoul of federal and state financial regulations, tax laws, and disclosure requirements.

For many businesses whose CFOs have grown into their current offices, it can be challenging to determine the duties a CFO should (or shouldn’t) be performing—or even to run down the many different tasks one’s CFO does during the typical workweek.

Learn more about the diverse array of responsibilities that often fall under the modern CFO’s umbrella, as well as how today’s top businesses are beginning to rethink and revamp the CFO’s role within a company.

Four Hats a CFO must wear

In the recently issued CFO and Financial Leadership Insights report by Michael Page, CFOs and industry experts working for some of the biggest companies in the world shared their opinions and experiences. The Insights report identifies four roles a top CFO must embody: Coach, Pilot, Scientist, and Engineer.

coach

Like any good sports coach or life coach, a CFO must serve as a mentor and a firm but compassionate leader to finance employees and other members of corporate leadership. Coaches must inspire those below them, making soft skills an incredibly important asset for a CFO.

pilot

Pilots can find many aspects of their job mundane or even boring, but in times of turbulence or crisis, they never lose a level head. Like airline pilots, CFOs must be able to look ahead to a short-term or long-term destination and maintain course even when things seem dicey.

scientist

In an ever-changing world, today’s CFOs must be innovators as well as rule-followers. Many of the nation’s top retailers, financial institutions, and service providers of the 1990s and early 2000s didn’t survive the Great Recession. A CFO’s ability to stay ahead of the curve when it comes to profitability, tax efficiency, and other financial matters has become crucial.

engineer

Companies of all sizes and types can benefit from an engineer’s meticulous and problem-solving nature, especially when dealing with complex financial, tax, and reporting regulations.

CFOs and finance managers who master each of these four roles can shift between them seamlessly to solve problems and accelerate growth for your business.

what do today’s cfos do?

Beyond these broad categories, there are some specific tasks and areas of responsibility that every CFO must cover.

regulatory compliance

One of a CFO’s biggest responsibilities involves compliance. While other fiscal employees can handle day-to-day items and accounts payable assignments, a CFO has a 10,000-foot view of the regulatory landscape and must make sure the business completes all its reporting obligations. CFOs must be able to motivate their employees to ensure that all applicable deadlines are met and that the data provided is trustworthy.

cybersecurity

Even if your business houses a separate IT department, cybersecurity decisions and precautions are squarely within your CFO’s wheelhouse. Financial information is subject to some of the most stringent privacy and security regulations out there, which means that a good CFO must have a solid grasp of potential security weaknesses and a plan for how to tackle them.

automation

The sheer number of tasks that must be completed on a daily basis can be overwhelming even for the most seasoned professional. It’s imperative for CFOs to avoid information overload by creating or facilitating a “data stream” that ensures they’re apprised of relevant information but aren’t bogged down with minute details.

If your CFO needs some guidance or would like to outsource certain tasks to a certified public accountant, Klein Hall CPAs can help. Our experienced staff has worked with a broad range of businesses, governments, not-for-profits, and individual clients in Chicago and the surrounding areas. Contact us today to learn more about the services we offer and to step into your financial future.