The changing role of the CFO

Introduction

This report discusses the future of the finance function, and in particular the future role of the CFO. It draws on discussions from the ACCA Accountants for Business Global Forum, as well as insights from ACCA–IMA roundtables held in Shanghai, New York, Moscow and Zurich in 2012, which discussed the way in which the role of finance leadership is evolving.

From these, a common set of views emerged. These included emerging challenges in the areas of regulation, globalisation, technology, risk, transformation, stakeholder management strategy, reporting, talent and capability. This report discusses each of these in detail.

Foreword by Helen Brand, ACCA chief executive

As the global body for professional accountants with almost 600,000 students and members globally, ACCA is at the forefront of supporting organisations to develop the appropriate capabilities to transform their finance functions. As the role of the finance function evolves, we also continue to recognise the changing nature of finance leadership.

Increasingly CFOs will have to deliver on a wide range of fronts: driving a more competitive finance function, establishing ever more robust risk management strategies and supporting their businesses to develop effective strategies for growth while remaining cost competitive. More than ever before, finance leaders and the businesses they represent will operate in a global economy that is significantly more volatile, presenting future CFOs with new challenges, but also new opportunities.

I am delighted that ACCA has collaborated with the Institute of Management Accountants in preparing this short report on the changing role of the CFO. The report shares current thinking, but has also been enriched by discussions that have taken place with CFOs across a number of high profile roundtable events that we have jointly hosted in key locations around the world. I would like to extend my personal gratitude to those finance leaders who participated in those events.

Foreword by Jeff Thomson, IMA president and CEO

IMA® (Institute of Management Accountants) is pleased to partner with ACCA, one of the world’s most influential and respected accounting associations, to work towards understanding the changing role of the CFO team with a series of high profile, in-person forums conducted around the globe. This understanding will help us deliver products and services to help CFO teams be more effective and efficient as they step up to the challenges of talent management, regulation, globalisation and much more.

With opportunity comes challenges, and vice versa. Today’s CFO team is expected to add value well beyond the traditional roles of cost management, controls and acting as the conscience of the organisation. These roles are challenging enough, but today’s CFO is expected to work in collaboration, by serving as the integration hub for key business processes, as a catalyst for change including business transformation, and as a consultant or trusted business advisor in helping to create sustainable growth.

We look forward to your input on the views of fellow CFOs around the globe as together we address and advance the capabilities of the CFO team to help the organisation deliver sustainable value while protecting investors.

Introduction from Richard Moat, CFO of Eircom Group and chairman of the ACCA Accountants for Business Global Forum

The outlook for the global economy in the short to medium term is greater uncertainty; fluctuating energy prices due to surging demand and supply disruptions, large currency fluctuations, commodity prices rises, public government deficits and cost cutting, inflationary pressures in some countries, and on-going environmental challenges.

All this is taking place against the backdrop of an inexorable longer term shift of power gravity from west to east, the growth of Brazil, Russia, India and China (the BRIC countries), which are in turn facing their own growth challenges, and the rise of new emerging economies. These macro-economic trends have a significant impact on the way in which businesses operate, the priorities they face, and the strategies they develop to be successful on a global platform.

This is the global environment in which tomorrow’s CFOs will operate. It presents challenges that they must face, and opportunities they must embrace. This report begins to consider these challenges by summarising the key issues and priorities that will shape the future role of the CFO and the future of the finance function.

The report draws on discussions from a number of high profile CFO roundtables jointly held by ACCA and IMA in Shanghai, New York, Moscow and Zurich in 2012. I would like to personally thank those senior finance leaders who participated in the roundtables for sharing their observations.

Finally, the report also reflects an on-going dialogue from the ACCA Accountants for Business Global Forum, which brings together finance leaders representing both ACCA’s and IMA’s membership around the world to discuss the issues and trends of major significance affecting the role of the CFO and the broader finance function. I am delighted to presently chair this forum, and would like to take this opportunity to express my personal thanks to members for their on-going contribution.

'The key question now is: how do I, as a CFO, prioritise when I have all of these issues facing me? I can't do all of this all of the time going forward.' ACCA-IMA roundtable, Moscow