According to "Developing the CFO of the Future," a study by the University of Toronto’s Rotman School of Management and executive search firm Odgers Berndtson, the more-complex expectations for an effective CFO's contribution to the organization means they have to interact with, and increasingly oversee, a wider array of business units.
"CFOs are expected to know more, do more and contribute more to the overall success of their companies than ever before," the study says.
Along those lines, the study says, attractive CFO candidates are those who bring a blend of technical expertise that's rounded out with business and operational acumen.
"The demands on the CFO have changed markedly over the past decade, accelerated by key events and disruptive trends," the report says. "Our study demonstrates that the successful CFO is anything but a narrow specialist."
Company executives interviewed as part of the study say that in a growing number of organizations, the CFO's role often includes oversight of functions, such as IT and compliance, that traditionally have reported to the CEO, as well as broader interaction with sales, marketing and other internal functions.
The CFO's relationship with the audit committee and the board of directors has also grown in many organizations, and increasingly extends beyond financial reporting to include strategic initiatives.
In addition, CFOs increasingly being asked to interact directly with large investors, analysts, the media and other potential stakeholders.
"The best CFOs are shadow COOs who often are the honest broker on the executive team," the study quotes Patrick Pichette, CFO of Google, Inc.
Developing Perspective
A growing number of companies are taking two common approaches to helping finance executives hone their operational skills and C-suite qualifications.
In one approach, finance executives receive two- or three-year rotations heading a business unit, where they're responsible for making strategic and operational decisions.
In a similar approach, finance leaders are asked to lead large-scale transformation or restructuring efforts that provide opportunities to hone strategic decision-making as well as collaboration with a variety of functional leaders.
"A CFO candidate who has been given the opportunity to 'fix' major issues will learn adaptability, develop an openness to new ideas and build strong leadership skills -- all characteristics of today's successful CFO," the study says.