CFO's Role Has Evolved From Reporting Numbers To Managing Business

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How has the role of CFO evolved over several years? How is CFO in general influencing the strategy adopted by the company?

It is a fact that the role of CFO has changed over the past decade and it is still evolving towards managing, growing and diversifying business. The number of CFOs has rapidly grown due to the growing intellectual needs of the businesses. The evolution started with presenting correct numbers, smart reporting, paving the way towards new regulations for a healthy commercial world, installing of cost management and cost leadership in an integrated ERP environment, managing working capital and capital expenditure, enhancing return on capital and adhering to regulatory compliances etc.

Gradually, the role did spread towards a greater involvement in the decision-making of the business and came with an expectation towards providing deep and precise insights. The commercial and financial considerations of all management decisions are vital to enable the collective leadership to steer an organisation forward and this is where the CFO started having increasing strategic relevance.

Today’s CFO fraternity is very different from what it used to be.

- They are able to partner their CEOs in creating a resilient but flexible business model

- They are analytical about data, regulations, business environment, competition; which helps in effective facilitation of business needs - ------ CFOs now analyse their business model and ascertain how the model is amenable towards adapting constant change

- CFOs are now very cautious about various known and unknown risks (e.g country-specific risk, product/sector risk, product technology obsolescence risk, cyber risk, etc) and they continuously find out ways to mitigate such risks