Ep. 107: Clive Webb - The Skills for the CFO of the Future

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Contact Clive Webb: https://www.linkedin.com/in/clive-webb/

ACCA and IMA "The CFO of the Future": https://www.imanet.org/insights-and-trends/business-leadership-and-ethics/the-changing-role-of-the-cfo

FULL EPISODE TRANSCRIPT:
Mitch: (00:00)
Welcome to Count Me In IMA's podcast about all things affecting the accounting and finance world. I'm your host Mitch Roshong and I'm here to kick off episode 107 of our series. The role of the CFO has evolved and in turn the skills required of aspiring CFOs have changed too. In this episode, Clive Webb Senior Insights Manager at ACCA shares his perspective on what today's CFO is responsible for, what skills are needed, how the pandemic impacted the role and the best ways to prepare for becoming a CFO. Keep listening as we transition over to the conversation now.
Adam: (00:46)
So Clive, how was the role of the CFO changing.?
Clive: (00:49)
Well,Adam. I think that's actually quite an interesting question its is, right. I think for a lot of CFOs, the role it is broadening, perhaps you could even say dramatically broadening, and its focus and how it is perceived are changing quite substantially. And what I mean by that is that certainly from the research work that IMA and ACCA did together, we felt that the role of the CFO was either increasing or significantly increasing. And in our survey about 72% of the respondents felt that the role was broadening out, and I'll talk about that in a second. But actually quite crucially, and one of the things that was quite strong in the report, we also asked a small selection of CEO's their perception. And if you asked the same question to them, you've got about 82%. So one of the things that we repeatedly saw through the report was if you're going to demand and supply side difference between the CEOs, who really expected the CFO's to go even further than perhaps they thought that they were going, and I think that broadening of the role is characterized by a broader set of stakeholders, a broader set of capitals, a broader set of responsibilities that all fall within the CFO's domain.
Adam: (02:30)
That makes sense, so then what do you consider to be included in the role CFO?
Clive: (02:36)
So I think the heart of the role remains the traditional financial acumen and financial skill. And as one of the interviewees put it, if the CFO doesn't get that right, then that's the end of that CFO, you know. So that stewardship, guardianship, asset safeguarding, traditional finance, recording, acumen, all those sorts of things, risk management, internal control, they are at the heart of the role.and very much still at the heart of the role. However, the CFO, I think you can counter itin two ways. Now the first of which is thou the, the right hand, the conscience of the CEO. So where the CEO particularly is looking more towards, sales, towards business growth, towards strategic opportunities, the CFO, yes is looking towards those, but also is the voice of dare I say, sanity. The voice of check the constructive right hand in that process. So not only do you need a view of the financial capital, the liquidity, the organization, which we've seen through the pandemic, it is absolutely vitally important. But if we think broader, it is a role that now embraces strategy. It still has that risk and control side, but that risk and control side itself is changing. And technology and data are playing fundamental parts. A lot of CFOs increasingly talk about scenario modeling and growth optimization as the future, and to do that, you need good technology and that good technology has to be embedded in data and that data has to align to the business strategy. They are therefore leaders in the organization, and as we've seen supply chains become increasingly challenge due to the pandemic they need to be on top of that agenda and also the customer centric agenda as well. And any of these broaden out into broader sense of what your stakeholders may be, how you think about the different capitals if you use the Integrated Reporting Councils Framework of six capitals. A lot of our interviewees thought the CFO increasingly needs to take view and manage stakeholder relationships at senior level across all of those capitals. So your investors are different. You are the ultimate consultant in business sense, and you've got to have a mind of transactions, M&A, growth or divestiture, which, you know, the pandemic is going to place, an increasing focus on as well. So that's what I mean, it's a very much a broader role.
Adam: (05:52)
Yeah, it's definitely a lot broader and you've briefly mentioned the pandemic and we're still in this pandemic and for the foreseeable future and the vaccines and all those things put aside, how has the pandemic impacted the role of the CFO?
Clive: (06:06)
I'll go back to a couple of comments, I think from some of our interviewees, and one of them who actually was a CEO, but a former CFO of a finance institution said, yeah, the role of the CFO has been tested by the pandemic, and it's the reliance on the CFO. That's going to become more important to give those perspectives, to give that ability to see further, and it's becoming an agile role is another one put it that there's no place for perfectionism, but there is a place for being able to be agile and to drive the business forward with a sense of confidence and, and therefore understanding the various leavers that are pulled. So in those two contexts, I think what we're seeing and back to my point about the right hand of the CEO is the CFO increases become a very important role in helping organizations understand what the art of the possible is, what the various scenarios that may play out will lead to, and therefore how basically the organization can survive. And I think the pandemic has reinforced the role of the CFO in very much making that happen.
Adam: (07:33)
In the report, there's a six hypotheses and do these six hypotheses, illustrate the changes happening now for many CFOs?
Clive: (07:43)
Yeah. But that's ri...