The growing influence of the CFO

Tamsin Ashmore headshot
In the first of a series of expert posts on the subject, Tamsin Ashmore looks at a trend that has been gaining pace over the past few years
The traditional role of the Chief Financial Officer as the figures and balance sheet lead, removed from the practicalities of daily operations and execution, is a thing of the past. In today’s rapidly changing business landscape, the role has experienced a remarkable transformation. 
As businesses face increasing complexities and uncertainties, the CFO’s role has expanded to encompass strategic decision-making, risk management and driving organisational growth. Today, CFOs are shaping the strategic direction of organisations.
It’s easy to see why CFOs have become integral to business growth. Financial success is driven by business success and is delivered through growth. If energy is spent on holding back, it is not spent on harnessing innovation and opportunity. The balanced scorecard held by the CFO is the direct feed into the financial results.  
Understanding the operational metrics of the business is critical to identifying, running and validating growth experiments with accurate, measurable outputs. Embracing paths not yet trodden and unlocking new opportunities is all part of a growth mindset, and this can only be achieved by knowing which goals to set. 
Equally, ensuring that they are flagging concerns for the road ahead is fundamental for a CFO. They need to have a deeper understanding of the issues and trends behind the numbers and the potential impact on the business to navigate the financial consequences ahead. 
Whilst CFOs are a strategic driver of growth, growth itself is delivered by people – making them our greatest asset and the core of what an organisation does
Forecasting and scenario planning take energy, resilience and determination, especially in an evolving market. There is a pressing need for businesses to grow at the right pace. Too much excitement at times of excessive growth can result in a slow-down and the need to make difficult decisions to future-proof your business. We’re seeing this in the tech industry right now.
The tech layoffs that have been happening have been around future-proofing the organisation to reach the profitability it needs to exist. Many have experienced excessive sales, and, in that state, it’s easy to get wrapped up in the excitement of growth. In a bid to deliver on it, they’ve hired lots more people, but this has proven to be unsustainable. 
Organisations have a responsibility to continue to reskill and develop their people to future-proof them in their lives and ensure that the business continues to grow the way you want. A person joining a company today may be doing a different job in 10 years as the world changes rapidly. Businesses need to recognise that each employee has the capability of personal development. Above all, there needs to be a move towards a responsible, sustainable growth trajectory, and the CFO also plays an integral role in this.
Not only is it essential to keep the business focused on sustainable profitability, implementing cost savings and other performance measures, but CFOs must also foster the right organisational culture. The lines between social life and work have been blurred over the past three years, and creating a sense of community is now indispensable for a business. If people don’t ‘buy in’ to a company, its ethos, purpose, brand values and leadership team, it won’t connect with people effectively. And this will have a disastrous impact on its ability to attract and retain employees during economic uncertainty.
For decades we have emphasised academic and hard skills in organisations and underemphasised values such as empathy, authenticity, and social-emotional skills. Yet, the priorities of a CFO in this uncertain economic climate are to be adaptable, create collaboration opportunities, analyse, uphold the truth, and make decisions. I believe the growing importance of these ‘soft’ skills in leaders will generate a wave of change.
Another of the values that a CFO should hold is integrity. Integrity with numbers and integrity in business are intertwined. This also translates to our relationships which should all be built on trust and authenticity.
Whilst CFOs are a strategic driver of growth, growth itself is delivered by people – making them our greatest asset and the core of what an organisation does. Enabling people to be their best, give their best and want to provide their best is a fundamental function of a successful business.
We reflect on our experiences, and being an empathetic leader is not only something that can achieve exceptional, meaningful results – employees desire it
Good leaders understand that you only get back what you put in. As mentioned before, the growing importance of soft skills has already seen some advancement towards more connected, empathetic and human leadership styles. But the pandemic and the inclusion of more females on boards means that this leadership style is now more normalised and defined. 
In my career experience, a defining ‘failure’ in my life was when I failed my exams at the University of Cape Town. However, I would not have had the determination or resilience to get to where I am today without this failure. After a massive dollop of self-realisation, I knuckled down and finished with a first-class honour’s degree in accounting from Durban University. And I can also happily say that I have continued to ‘fail fruitfully’ at times within my career. It’s this that shapes me into an authentic leader.
We reflect on our experiences, and being an empathetic leader is not only something that can achieve exceptional, meaningful results – employees desire it.

Whilst these are just some of the elements that have shaped today’s CFO, it’s not to say that that is where the change ends. From integrating advanced analytics to aligning strategy to business risk, financial leadership will continue to determine a company’s overall direction. This means that the influence of the CFO will continue to grow. It’s never been a more rewarding time to be one.

Tamsin is CFO of Ultima


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