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The Super CEO Meets the Super CFO — May 2024

It turns out it is not just CEOs who are the superheroes of business today. Our new survey, “The Super CFO,” explains how CFOs all over the world are rising to meet their own new set of extraordinary expectations. Of the nearly 600 CFOs we reached, 82% attest to a massive expansion in CFO responsibilities over the last five years. Most are energized by their growing positions and the widening reach to more stakeholders. Above all, they understand that their expanding roles are a necessity in light of CEOs’ own increasing duties. “Because of the breadth that is now demanded of a CEO, the role of the CFO has evolved tremendously to be that of a copilot,” explained Prashanth Mahendra-Rajah, Uber’s CFO. “The role of the CFO has changed very significantly,” agreed Jean Hu, CFO of AMD, adding, “I think the key thing is to figure out where you can add the most value to your CEO and to your general manager and your business teams.” 

Where can CFOs join forces with CEOs in tackling the expanded leadership expectations? There seem to be a few areas where this collaboration is most apparent at present. 

Future-Oriented/Strategic Thinker  

Planning ahead and navigating complexity are arguably the primary challenges CEOs are facing today, and it helps a lot to have a partner thought leader in tackling these ongoing endeavors. CEOs really benefit from a CFO with a sharp, forward-thinking mindset — even when the future isn't particularly clear. Our survey showed that CFOs have welcomed taking on a shared responsibility in navigating complexity, setting the strategy, and leading as an enterprise-wide executive. “CFOs are getting better at looking ahead, better at contemplating all of the variables.…In that way, I think the role itself is a little more forward looking than where it's been historically,” explained Zane Rowe, CFO of Workday. Jean Hu added, “It's actually quite exciting because you can make a bigger impact for a company. You can be a strategic advisor, you can be an operator.” Another was quick to note that “This partnership doesn't mean that the CEO and CFO always agree. My job is to analyze trends and plan to ensure the future financial health of the company and that all future major decisions are based on solid financial data.” Presumably, these differences in perspective can fuel an even more productive strategic partnership if channeled effectively. 

Many CFOs shared that time constraints often prevent them from being available to fully engage at this strategic level. Reflecting on the actual and desired allocation of time to core financial responsibilities, CFOs expressed a desire to spend more time on strategy development, nurturing finance talent, collaborating with other business leaders, and optimizing capital allocation. Thinking ahead to the next five years, the competences CFOs cited as most important to their evolving role will be: Driving organizational change (41%), shaping strategy (25%) and developing talent (13%). The latter, developing talent, of course, will be most essential for allocating parts of the finance role into capable hands and freeing up the CFO to spend even more desired time on strategic planning with the CEO.

Scenario Planning and Risk Management

With disruption such a constant factor, leaders have to be able to move quickly from a tactical level back to the strategic level all while understanding how the two affect each other in the unfolding scenarios. All CEOs face unanticipated crises, and their overall performance depends not on the crisis itself but on their response to it. They need to be able to depend upon their CFO’s enterprise risk management focus and core expertise when they face the inevitable questions of adjustments and change. This has been abundantly clear over the last few years, in particular, and driven the “co-pilot” partnership of the two leaders. “If done right, risk management is a business booster not a limitation,” explained one CFO survey respondent. The CFOs who take on a sharp “contingency mindset” and develop response plans that can be adjusted quickly and efficiently are highly valuable to CEOs today.  

New Responsibilities 

While overseeing the organization with the CEO seems to be the primary goal for CFOs, their responsibilities have expanded in other directions as well. In particular, complying with new Environmental, Social and Governance (ESG) regulations has been a significant undertaking for more than half of CFOs globally over the last two years.

Other expanded responsibilities have also included M&A and Corporate Development roles. Under these, there were interesting variances by sector: CFOs in the industrial sector were the most likely to have added ESG responsibilities to their remit (62%); and cybersecurity was more likely to be a recent addition to the remit of a healthcare and pharmaceuticals CFO’s responsibilities than other industries. Paradoxically, ESG and Cybersecurity are precisely the two areas which a significant share of CFOs would like to exclude from their remit. 

What else should CEOs know as they look ahead to a strong CFO partnership?  

While time constraints and expanding responsibilities may pose some barriers, CFOs remain motivated by the job: Most CFOs rated their work-life balance as “OK” (51%) or good (29%). To strike this balance, CFOs are perhaps tapping into their inner strength and resilience, with several having reported personal strategies that range from blending personal and professional lives, living a healthy lifestyle, cultivating hobbies, among others. 

As CEOs consider long-term implications for their partnership with the CFO, retention and growth opportunities should be a key consideration. Notably, 43% of the CFOs we reached reported that they are being approached for new opportunities more often. As they project their career plans, most CFOs are far more motivated by the quality of the executive team (60%), the company growth prospects (45%), and a broader mandate (34%) than they are by compensation. “I would never take a CFO opportunity unless I felt the CEO and I had alignment on culture, management philosophy, and the company vision. Comfort that chemistry will be there is also critical,” explained one. He also emphasized: “Given my senior experienced nature, I would only accept positions where the CEO views me as the most senior advisor and would solicit my input before making major decisions.” 

Clearly, the potential for a core partnership with their CEOs is critical for CFOs today. And a good majority of CFOs aspire to be CEOs someday (60%), so an opportunity to work more visibly with their CEOs and gain more customer/market knowledge as well as operational expertise will help prepare them for that desired step-up.

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“The co-pilot has to be able to do everything that the pilot does, fly the plane, land, take off, navigate, talk with air traffic control, talk with the crew, keep the passengers or the customers or the clients engaged,” explained Howard Ungerleider, the recently retired CFO of Dow. In today’s highly complex, often disruptive business environment it seems to take two business superheroes today to steer the ship and deliver value for all the stakeholders in an enterprise. “Having worked now for many CEOs, I will tell you, it is a very lonely job. …[A]nd the benefit of being a CFO is, you get to be that counselor, that advisor to a good CEO,” as Prashanth Mahendra-Rajah put it. While the CEOs are the ultimate decision-makers, a strong partnership with their CFOs goes a long way to assure them of the right path[s]. As the world continues to change and becomes less and less predictable, this partnership is likely to only become more desired and stronger. 


 

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