Are CFOs now ‘mini chief executives’?

Published in Raconteur’s The Future CFO supplement in The Times 

A successful chief financial officer now has to support the chief executive in developing company strategy as well as taking care of finance. Sally Percy reports

If you want proof of how far the role of chief financial officer or CFO has evolved from number cruncher to strategic adviser, talk to a headhunter about the briefs they get from chief executives.

“If you look at a job specification from ten years ago, everything that was on there then is still on there today,” says Mark Freebairn, partner and head of the financial management practice at executive search firm Odgers Berndtson. “But there are two more pages that weren’t there before and are there now.”

The pressure on companies to innovate and compete in an increasingly complex, fast-moving and transparent world has led to the chief financial officers of large businesses becoming more involved in driving the commercial activities of their organisations. So they are helping to improve the business, manage margins, assess potential new markets, make investment decisions and oversee mergers and acquisitions.

These are activities that all conceivably fall under the umbrella of strategy and require chief financial officers to possess a wide set of skills.

The scale to which the chief financial officer’s strategic remit has been expanded is clear from the briefs that Mr Freebairn gets, which often request what is essentially a “mini chief executive”. “CEOs say, ‘I need a CFO who will second-guess me because that will make my decision-making more robust. I need a commercial equal in that role’.”

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