Business

CFOs to play vital role in reframing enterprise post-Covid

The role of chief financial officer (CFO) will reportedly emerge as one of the C-suite’s “most critical” roles in reframing the future of enterprise post-pandemic and beyond, according to EY. 

The findings come from the firm’s 2020 EY DNA of the CFO, a survey of more than 800 global CFOs and senior finance executives.

Some 86% of respondents said they will be required to “protect their organization today, while enabling future growth”. 

In addition, 84% agreed that achieving a balance between short-term results and creating long-term value will become a “priority”. This will also include traditional mandates, such as corporate reporting, along with new ones such as overseeing digital transformation.

According to EY, CFOs will also need to enhance relationships with fellow C-suite peers. The survey, however, found 52% of responding finance leaders reported limited or no collaboration with the chief human resources officer (CHRO) with 44% saying the same regarding their relationship with the chief marketing officer (CMO).

Myles Corson, EY Global Strategy and Markets leader for Financial Accounting Advisory Services, said: “Senior finance leaders need to look beyond solving today’s major issues or even what lies ahead in the near-term future. 

“Instead they need to imagine what finance could look like five years from now. The perception of finance as a risk-averse, cost-conscious team with a back-office mindset will be a thing of the past, with finance defined by a value-focused culture that’s aligned with enterprise purpose.”

According to EY, CFOs also recognize the importance of a purpose-driven strategy, with 82% of respondents saying that they were “increasingly seen by key stakeholders as the stewards of long-term value”.

In addition, 79% of respondents said that investors are increasingly requiring more information on how their organization creates long-term value for all stakeholders, while 81% believe there is significant value for their organization that is not measured or communicated using financial KPIs.

Corson added: “It is imperative that finance professionals take the lead in integrating financial and nonfinancial performance through an enterprise-wide framework for value creation that embraces how crucial intangible assets – including talent, brand, innovation and culture – contribute to long-term value creation.”

Tony Klimas, EY business consulting partner, said: “In this hyperconnected world, how organizations create value will shift from behind the walls of the company out into the network space. CFOs should look to reframe finance for this new reality. 

“The finance function should become more open, working, as part of an extended ecosystem, in deeper collaboration both within the organization and also externally.”

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