In the past few decades, we have witnessed significant growth in the demands on and expectations of Chief Finance officers when it comes to helping their organizations deal with increasingly complex business world. What we are saying is that the role of a CFO is changing. Traditionally, the main emphasis of the role of CFO was characteristically that of safeguarding thefinancial health of an organization, exercising adequate financial control and overseeing economic structure implementation of the organization. This ensured that needs of large corporations that strived for financial control and transparency across the various departments of the corporations were achieved.
Today, the CFO still plays those same roles, but there is an expanded list of roles the modern CFO is expected to play in an organization. In other words, the role of a CFA is driven by complexity as a result of globalized capital and expanded markets as well as the unprecedented growth in information communication and technology. That means that the role of a CFO has expanded as well.
In addition to being the financial caretaker, the modern CFO is also expected to participate in driving the business toward attaining its objectives. So, the CFO is part and parcel pf the organization’s leadership and plays a significant role in defining and implement the organization’s strategic objective. It is expected that CFOs will play a greater role in increasing their support of operational and strategic decision making in organizations apart from fulfilling their traditional financial goalkeeping roles.
CFOS also find themselves in a unique role of ensuring compliance, financial discipline and compliance and business ethics in an organization. Without their presence, the organization may find itself in a greater risk of having to deal with economic crimes, fraud and bad business decisions that may plunge the business into financial crisis. In forward-looking organizations, the chief finance officer and other offices that play in that capacity find that their roles are evolving hence there is a need to redefine the role of a CFO in the modern business environment. As already mentioned, CFOs, especially those of big organizations, find that the business environment they are now operating in is entirely different from those of their predecessors. For instance, multinational corporations such as Scholastic find themselves in a unique position of serving diverse market. In other words, the roles of CFOs are evolving from a transactional and cost efficiency focus to an increasingly value-adding strategic focus.
CFOs continue to be stretched and scrutinized in the modern business world; hence, they need to maintain the high view of the companies they work for and demonstrate high levels of professional responsibility. Thus, thy must demonstrating ethical leadership and business integrity. In addition, the CFO must be able to balance pressures and short-term concerns of the business organization with long-term visions of the company. The role they play in the organization will not only help the organization achieve profitability but also help the organization realize its core values and goals.
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