According to a report by Accenture, which is based in Dublin with offices in Detroit, Livonia, Troy, and Ann Arbor, the role of CFOs continues to expand; 72 percent of surveyed CFOs report they have the final say on the appropriate technology direction of their enterprises.
The broadening of the role comes as the COVID-19 pandemic continues to challenge organizations and companies face other challenges including digitalization, market dynamics, and fast-evolving consumer expectations. CFOs are also being asked to ensure their companies mitigate risk by addressing environmental, social, and governance performance, as well as security challenges.
“The role of the CFO has further evolved beyond serving as the finance lead to becoming a ‘digital steward’ of their organization. Increasingly, CFOs are focused on collecting and interpreting data for key business decisions and enabling strategy beyond the borders of the finance function,” says Christian Campagna, senior managing director and global lead of the CFO and enterprise value practice at Accenture.
“Faced with new challenges spurred by the pandemic, today’s CFOs must execute their organizations’ strategies at breakthrough speeds to create breakout value and success that can be realized across the enterprise.”
The report identifies a group – 17 percent – of CFOs who have transformed their roles effectively, resulting in positive changes to their organizations’ top-line growth and bottom-line profitability. CFOs who operate effectively at breakthrough speeds could almost double companies’ earnings before interest, taxes, depreciation, and amortization compounded annual growth rate from 3.8 percent to 6.9 percent over the next three years and increase their revenue compounded annual growth rate from 2.7 percent to 3 percent.
The CFOs are seen as economic guardians by providing predictive insights and identify new sources of value across customers, channels, and products. They also work to unlock the full benefits of digital transformation.
This is especially true as 60 percent of traditional finance tasks are currently automated; however, 43 percent of CFOs surveyed have used advanced financial modeling in the past two years to identify future risks and opportunities. Only 23 percent are using the cloud to provide new insights, and 16 percent are using the cloud to identify new value sources.
They also drive end-to-end insights through real-time data and models. Successful CFOs are using technology and data to synchronize information across the C-suite. About 86 percent of CFOs have increased the frequency and scope of collaboration with C-suite partners, leveraging their visibility, analytics, and access to data and insights to enterprise risk. About 88 percent have introduced new metrics to better leverage finance’s collaboration with and influence on the enterprise.
Companies are increasingly looking to CFOs to spearhead thinking around future operating models and drive the technology agenda with a focus on security and environmental, social, and governance performance.
About 68 percent of surveyed CFOs say finance ultimately takes responsibility for environmental, social, and governance performance, and 34 percent cited concern about data and privacy breaches as a barrier preventing them from realizing their full potential as a driver of strategic change.
“Leading the enterprise in the face of disruption means that CFOs must expand their technology responsibilities and digital skills if they are to be truly responsive to the needs of their entire organization,” says Aneel Delawalla, managing director and enterprise value targeting lead in Accenture Strategy. “The CFOs that embrace these new roles and capabilities will drive greater value at even greater speeds than their peers.”
The research is based on online surveys with more than 1,300 senior finance leaders from around the world, carried out between April and June 2020, as well as a smaller survey of 177 respondents between February and March 2020. Accenture also conducted more than 40 qualitative interviews with CFOs. The full report is available here.
Accenture is a professional services company with capabilities in digital, cloud, and security.
