A recent global survey conducted by leadership advisory firm Egon Zehnder sheds light on the evolving role of Chief Financial Officers (CFOs) and the challenges they face in today's corporate landscape. The findings indicate a significant increase in job responsibilities for CFOs, with 82% of finance leaders reporting a rise in their duties over the past five years.
According to the survey, CFOs are increasingly tasked with handling diverse areas such as environmental, social, and governance (ESG) initiatives (55%), mergers and acquisitions (44%), corporate strategy (38%), and risk management (36%). Despite this trend, resistance towards ESG-related projects persists among some CFOs, who view them as misguided, misused, and politicized.
Interestingly, the survey reveals varying attitudes towards ESG responsibilities across different industries. For instance, a substantial portion of industrial CFOs (62%) and technology and communication CFOs (57%) believe ESG initiatives should not fall under their purview. Similarly, over half (52%) of consumer-based industry CFOs express reluctance towards ESG compliance.
As CFOs grapple with mounting workloads, they increasingly rely on their internal finance teams for support. The survey highlights the pivotal role played by the heads of Financial Planning & Analysis (FP&A), with 57% of CFOs naming them as their most valuable team members. Additionally, nearly half (49%) of CFOs consider their controller/chief accounting officer (CAO) indispensable.
Regional differences in reliance on CAOs are notable, with North American CFOs (67%) being the most dependent, followed by their counterparts in Asia/Asia Pacific markets. Financial services companies exhibit lower reliance on CAOs (36%) compared to other industries surveyed.
The survey also underscores the high turnover rates among CFOs, driven by increasing job opportunities and dissatisfaction with current roles. While 43% of CFOs report frequent poaching attempts, the frequency varies across industries, with services-based CFOs contacted weekly, pharmaceutical CFOs monthly, and consumer-based CFOs every few months.
Contrary to popular belief, monetary incentives and work hours are not the primary factors influencing CFO turnover. Instead, CFOs prioritize the quality of the executive team (60%), company growth prospects (45%), and a broader job mandate (34%) when considering career moves.
The survey highlights the multifaceted challenges faced by CFOs in today's dynamic business environment, emphasizing the need for continuous adaptation and strategic leadership to navigate evolving responsibilities effectively.
