As one interviewee told me during our work on the CFO and strategy: “A CFO who does not take a leading role in strategy is not really a CFO.”

It is certainly an evergreen topic. Back in 1997, an Arthur Andersen report quoted the then-CFO of Philips: “The job here requires not just financial exposure, but it requires a management understanding. You must play a key role in strategy; you must play a role in every element of the company.” I must confess I get grumpy when commentators argue that the CFO’s strategic role is somehow new. But it does seem to be the case that some CFOs are not contributing as much to strategy as they could.

There are three main challenges: lack of demand, lack of time and lack of skill. The most worrying of these is lack of demand, as this means organisations are failing to make the most of a potentially valuable contributor. And it is perhaps the most difficult to address. The perception that accountants are just financial specialists with little to offer in more general business conversations can be ingrained in some organisations and countries.

Changing such perceptions is not easy, requiring perseverance and a multi-pronged approach. For example, CFOs and their teams need to demonstrate their business acumen in ways that cannot be ignored, and professional bodies need to promote the breadth of knowledge and expertise their members can bring.

If the organisational demand for more strategic input from CFOs is present, then investment should be available to overcome the other two challenges of time and skills. For example, the strategic CFOs we spoke to had invested in developing or recruiting a high-performing number two, to whom they could delegate tasks previously only they could carry out. And there is no shortage of development programmes to help CFOs hone the strategic skills they need, such as ICAEW’s Financial Talent Executive Network (F-TEN®) programme.

The Business and Management Faculty is also aiming to help through a series of resources tailored to CFOs and aspiring CFOs. At icaew.com/cfoandstrategy, we have a report on the nature of strategy, as well as links to web pages covering the CFO’s many roles in strategy, the drivers of the CFO’s strategic role and overcoming barriers to making a greater strategic contribution.

In our discussion on the nature of strategy, the key question we consider is how to weigh up the pros and cons of taking a planned approach to strategy versus a more emergent, opportunistic one. This has become particularly pertinent with strategic plans being ripped up in response to COVID-19, and new plans on hold in the face of continuing uncertainty. As one CFO stated, pre-pandemic: “You have to be realistic about how far you can, and need, to look ahead, and at what level of detail and certainty.”

Organisations that take a more emergent approach emphasise keeping options open, just-in-time allocation of resources and are constantly evolving their strategy. However, this is not right for organisations where big bets need to be made – for example, a new passenger jet will take many years to get from the drawing board to delivery.

One of the striking things learned from talking to many CFOs about strategy was the large number of roles they take in the strategic process – from creator to orchestrator to implementer. We describe eight roles in our work, The many strategic roles of the CFO. This means you do not have to be a particular type of person to play a big part in strategy. The creative CFOs can come up with great strategic ideas, the great communicators can ensure strategic buy-in, and the critical thinkers can provide the challenge necessary to ensure that strategies are robust.

We hope you find our current resources helpful. Let us know what you think and send any ideas for how we can continue to help CFOs by emailing business@icaew.com.

Download PDF version:

• Business & Management magazine, Issue 296, July/August 2021 (p.11)

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Further reading on CFOs and strategy is available through the resources below.