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Why Companies Need to Support Their CFOs Now More Than Ever

Why Companies Need to Support Their CFOs Now More Than Ever

June 2023


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Chief Financial Officers (CFOs) are a well-entrenched role in the C-suite. They oversee the larger financial decision-making within an organization and tend to a business’s most important element: profitability.

A CFO’s job can be highly objective and analytical. It can be seen by some as an unglamorous position that often isn’t noticed unless things go very well …or horribly wrong.

What executives and board members need to realize at the moment, though, is that their CFOs may be the linchpin keeping their organization afloat — and they should receive the growth-oriented support worthy of such an important role.

Why CFOs Are Critically Needed Right Now

A Chief Financial Officer always provides a sense of financial security and confidence. When times are good, this energy focuses on things like ongoing stewardship of finances, forecasting growth, exploring potential mergers and acquisitions (M&As), and so on.

However, when business becomes turbulent, having a competent CFO becomes essential — as is the case at the moment.

2023 started with bank instability in the USA that continues to reverberate throughout the financial sector. Inflation remains a persistent concern, as well.

Some industries are going through massive layoffs, too. There is also a dramatic reshuffling of talent on every level of the corporate ladder — which can be prohibitively expensive, especially for C-suite positions.

The combination of financial, talent-based, and wider economic concerns makes buttoning up a business’s bottom line a top priority at the moment. Your CFO should take the lead in this area, but it’s up to the rest of an organization (and especially its leadership) to enable their CFO to survive and thrive, even in adverse conditions.

How to Set Your CFO Up for Success

A recent study by PwC found that along with obvious things like ongoing financial oversight, the “winning formula” for financial success (particularly in larger companies) includes:

  • A proactive approach to portfolio management.
  • The willingness to consider divestitures.
  • A boldness to act with speed.

When these three elements were present, the site reports that the probability of positive total shareholder return is a staggering 99.5%. In order for this to happen, though, companies must empower their CFOs not just to do their jobs, but to do so with long-term growth in mind.

This tends to focus on two key areas: reinforcing internal initiatives and facilitating growth from a financial perspective.

1. Reinforce Internal Initiatives

If the CEO and/or the board of directors want to support healthy CFO activity, it’s important that leaders understand the impact that a CFO has on key company initiatives. For example, many brands have spent years positioning themselves favorably in the eyes of consumers through corporate social responsibility (CSR) efforts. This looks good on the surface, but in many cases, CSR has been viewed by many to be more of a marketing gimmick than anything else.

Businesses have moved away from basic CSR messaging and are investing in ESG (environmental, social, and governance) — and not just as a concept. ESG 3.0 takes the concept of CSR and gives it teeth. It is empowering businesses and their CFOs to genuinely invest in calculated, responsible, and profitable behavior.

Digital transformation is another internal aspect of a business that requires CFO involvement. Businesses are embracing everything from digitization to automation to full-blown artificial intelligence (AI) solutions. This requires hefty capital investment in new equipment and training.

There’s also the obvious (though challenging) element of attracting, developing, and retaining future talent — not just across a company, but in the finance department. Leaders must enable CFOs to both recruit new talent and upskill existing talent that can understand the evolving post-pandemic financial landscape.

2. Grow Against the Grain

The other, outward-facing aspect of CFO activity is growth — not just in general, but in an economically tough environment.

A good CFO knows it’s possible to spark growth even in a struggling economy or industry. This can come through traditional marketing, M&As, new product release, and so on.

The important thing to remember is that growing when cash is tight reduces the margin for error. CFOs must walk a tightrope as they balance maintaining short-term stability with investing in long-term potential.

3. Support Your CFO to Unleash Growth

The difference between healthy and poor corporate finances comes from more than your external environment. If you empower your CFO with the support to focus on financial priorities, it can unleash growth in any economic climate.

“If you empower your CFO with the support to focus on financial priorities, it can unleash growth in any economic climate.”

This requires a willingness for fellow executives to understand the many different things (ESG, digital transformation, talent acquisition, targeted growth) that a CFO is juggling. This is the first step in productive C-suite collaboration.

When capable CFOs feel supported in their job of balancing risk and growth, it paves the way for them to successfully navigate any situation.

Of course, the key word there is “capable.” That’s why at Stanton Chase, we put an enormous emphasis not just on recruiting talented and qualified financial professionals, but on finding the right individual for each CFO position. When a CFO has the training and soft skills that align with their company’s needs and they’re properly supported by their fellow executives, they can become one of the best tools a business possesses to simultaneously navigate current challenges and pave the way for future growth.

About the Authors

William Brewer, CCP, is a Director at Stanton Chase Los Angeles. He is also Stanton Chase’s Global Human Resources Practice Leader. Prior to moving into executive search, Bill had 25 years of experience in corporate human resources. In addition to his executive search career, Bill is an adjunct Professor at the University of Redlands. Bill also serves as a mentor for the MBA program at the Paul Merage School of Business at the University of California, Irvine (UCI) and has been a mentor with the School of Business at the University of Redlands.

Cathy Logue, FCPA, FCA is a founding Managing Director at Stanton Chase Toronto and Global Leader of Stanton Chase’s CFO Practice Group. She has over 30 years of executive search and financial leadership experience, working with clients across North America. Prior to her career in executive search, Cathy obtained her Chartered Accountant designation with Ernst & Young, and was awarded the Fellow (FCPA, FCA) designation in 2017. In 2021, she was recognized by the WXN Top 100: Most Powerful Women in Canada for her efforts in advancing women in leadership. Cathy sits on the Board of the Association of Executive Search and Leadership Consultants (AESC) and is former Vice Chair, Finance on the Stanton Chase Board of Directors.

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