New research by ACCA (the Association of Chartered Certified Accountants) and BDO, the international network of public accounting, tax and advisory firms, has revealed how the role of the CFO is growing to include driving business decisions and reporting on the non-financial areas of their operations.
Over 100 CFOs and business leaders from around the world took part in roundtables and in-depth interviews to contribute their insight into how the traditional role of the CFO is changing, resulting in the report ‘Chief value officer – the important evolution of the CFO’.
To be successful and sustainable, businesses and other organisations increasingly need to combine economic, environmental and social equity. Those that don’t, face risks and their value can diminish – there is a very strong link between value creation and strategy. Using the breadth of drivers (financial, manufactured, intellectual, human, social & relationship and nature) to generate benefit for a wide range of stakeholders creates value. With a focus for many organisations on purpose and value, contributors were asked to consider whether there is a trend to asserting the need for a new role of chief value officer and whether this a role that the CFO is already fulfilling.
The report yields three significant findings. Firstly, the concept of value holds paramount importance in organizational performance management, serving as a pivotal factor in their journey towards long-term sustainability. Secondly, Chief Financial Officers (CFOs) are progressively embracing a value-centric methodology in their operations, signifying a transition towards encompassing the role of Chief Value Officer within their traditionally financially-oriented responsibilities. Lastly, the trajectory to becoming a CFO demands an expanding array of experiences, necessitating a blend of structured and informal learning initiatives. Professional bodies and practices must actively engage with this evolving development path to effectively cater to aspiring CFOs.
Helen Brand, ACCA Chief Executive, said: ‘We already know that CFOs are increasingly acting as strategic leaders and advisers in their organisations. The CFO role is one that has moved significantly from the traditional view, while retaining the core responsibilities. Now there’s a real opportunity for them to satisfy the value agenda and evolve the role for the next generation of CFOs.’
Ashane Jayasekera, Deputy Managing Partner, Head of Forensics, Risk & IT Security, BDO Partners Sri Lanka, added CFO’s play a very important role as “Co- Pilots” in an organsiation, and they already interact with the key players involved in ESG planning and implementation. Given the importance of the ESG Agenda, CEO’s are expecting their CFO’s to step up and play their role in ESG adoption and reporting”. CFO’s are in an ideal position to provide the necessary information to obtain the funding for ESG investments”
The emerging generation of CFOs in Sri Lanka must take the lead in cultivating a comprehensive outlook on business performance and purpose. As our nation progresses towards nurturing sustainable organizations, the role of the CFO should be poised for a transformative evolution that demands a deep embrace of the broader facets of sustainability and social impact, that requires to be seamlessly integrated into their operational strategies, noted ACCA Head of South Asia, Ms,Nilusha Ranasinghe.
