By Rick Payne, manager finance direction programme, Institute of Chartered Accountants in England and Wales (ICAEW)
When we talk with ICAEW members in business, the diversity of their skills, experience and aspirations is striking. Yes they all have a solid grounding in finance, tax, compliance and so on. But, despite the stereotypes, they can also be charismatic communicators, IT whizzes and canny entrepreneurs.
The accounting profession continues to attract some of the brightest and the best. So far this has provided a flow of people able to take on the chief financial officer’s role required by the varying needs of businesses and their boards, but there is always more to do.
With this in mind we believe there are three areas to consider in order to ensure chief financial officers continue to enhance organisational performance and develop the financial leaders of the future:
1. Know your business, know yourself and know whether the fit is right
If there is one consistent piece of advice we get from chief financial officers, it is that to be effective you have to understand the business. Easy to say, not always easy to do given the pressure of the job. But getting out into the business, understanding how value is created and tracking competitor strategies have to be prioritised.
This becomes a lot easier when self-aware chief financial officers build an effective finance team which compensates for their own weaknesses. And by delegating significant responsibilities, they play an important part in developing future financial chiefs.
However, even chief financial officers who build great teams know that their knowledge, skills and experience are better suited to some circumstances than others. For example, we know of chief financial officers who specialise in turnarounds, realise that they are not suited to running a stable organisation and aim to develop a successor who can then step up to the role when the time is right.
2. Be a role model for continuous learning and development
Chief financial officers learn almost continuously through their day-to-day work, be it through discussions with other board members, meeting operational managers or reading the latest market analysis.
But sometimes a more structured approach is called for to open up new ways of thinking and collaborate with people from different industries. ICAEW supports this through its year-long F-TEN programme for chief financial officers and those aspiring to the position, which blends mentoring, workshops and peer-learning sets. Role models are important for developing future leaders and by demonstrating a commitment to self-development, chief financial officers help ensure their finance teams also take learning seriously.
3. Play a part in improving diversity in finance teams
Organisational needs will continue to evolve, particularly given the development of new technologies including artificial intelligence. So it’s difficult to predict future chief financial officer career paths, and the types of people and skills that will be required.
In addition to continuous learning, one way of reducing the risks of not having the right people available is to increase diversity in the finance department. We mean diversity in the broadest sense, not just those nine areas protected in UK law, such as gender and race, but also employing people from different disciplines, like data science, in the finance department. Also important is the two-way movement of staff between finance and other functions.
Chief financial officers have been fulfilling strategic roles and leading on IT for decades. In other words, they have managed to adapt to the needs of the time, albeit some more successfully than others. Such adaptability does not happen by accident and the finance profession cannot be complacent. However, we believe today’s chief financial officers will continue to adapt and play their part in developing the financial leaders of tomorrow.