CFOs must assist companies stabilise as post COVID-19 strategy, says AML Chief
More than ever, financial leaders are expected to be at front-line after COVID-19 pandemic.
How much leadership capability can Chief Finance Officers bring to bear on corporate leadership after the pandemic?
A number of experts have agreed that the ravaging pandemic has technically speaking, brought about a new economic model, albeit unplanned.
This emergency, as expected would birth equivalent but remodeled corporate strategies.
Research analysts at MarketForces said this time, however, rather than targeting growth, companies would look to stabilise.
Companies, due to the need to salvage the remnant of the economy, would likely deploy the strategic financial thinking capabilities of their Chief Finance Officers (CFOs) for growth strategies.
In this chat, Agboola Mabinuori FCA, the Chief Executive Officer at Accretion Maven Limited (AML) explains how CFO will help companies pursue growth after the pandemic.
MarketForces: How is the new economic model going to impacts CFOs?
Mabinuori Your question is a bit multifaceted. One thing one has to agree is what the new economic model is all about.
I see a lot of shift from macroeconomic consideration to more of micro economics consideration.
It is also supported by monetary and fiscal policies that aim at stabilizing and boosting organizational operation and survival.
Entities at this time are looking for corporate survival through corporate sustainability activities rather than corporate social responsibilities.
In the light of the above, the CFO as a business partner must assist the entity in stabilization policies but must look beyond the now into the future.
The CFO must understand all the parameters and organizational touch points that assist the entity keeping to its goals and know when these key touch points are threatened and provide roadmap/strategies to deal with the threat.
MarketForces: Corporate sustainability over social responsibilities can you please explain this?
Mabinuori: The aim of corporate social responsibilities is philanthropic in nature while corporate sustainability aims at using philanthropic activities to boost the company’s image and perception in the society thereby leading to more market share.
When an entity donates quietly with no fanfare and image laundering, it is CSR but when it does the same thing especially in a trending environment and not necessarily for need and broadcast such, it is corporate sustainability.
Have you ever wondered why a lot of big entities sponsor sports, big brother and other reality shows with so much money and relegate education and health related sponsorship
MarketForces: With what you have seen so far, would you say there is a departure from expectation?
Mabinuori: The only expectation that is valid is that of shareholders, the market and entities do so much in a dynamic business environment to meet these expectations.
The CFO’s role is to evaluate all the strategies employed by the entities is the light of the available data and support implementation.
He also has a role in designing and formulating such strategies.
MarketForces: So, would the new economic order push more CFO to taking more leadership roles beyond crunching numbers? Would CFO perform as corporate strategist in the light of these developments in the economy?
Mabinuori: Of course. The CFO role has always been a strategic and leadership role. These roles are however advisory in nature; the sell role rather than the tell role.
The main advantage the CFO has is that of having insights into all aspect of the operations of the entity as the custodian of the financial data and having unfettered access to the business data.
His ability to crunch and analyse these data into insightful information will always give him that unfair advantage to give advice that is relevant and reliable.
Please note that this is in addition to his role in the enterprise financial management and reporting
MarketForces: Interesting. Comparatively, would you say CFOs are better corporate managers?
Mabinuori: Absolutely!
The ones that understand business and leadership only; not the ones that sticks to number crunching and data classification only
MarketForces: It is certain a lot more of professionals in finance would make adjustment going forward, what would you advise them to do in the process?
Mabinuori: An aspiring CFO must be jack of all trade and master of all in the business environment.
What I mean here is that he must be versatile in all functional areas, knows a lot about designing and implementing processes.
CFO must understand risk management; go beyond user level to business analyst level of financial management systems, line of business systems and Enterprise Resources Planning.
Then, he must be conversant with current environmental issues both internal and external environment, be able to lead and manage etc.
But with all these knowledge, he must realize that it is only in his functional unit that he has tell authority; for every other functional unit, it is about sell authority.
This is why he needs a lot of influencing skills to be able to sell his ideas in the implementation of organizational strategies.
CFOs must assist companies stabilise as post COVID-19 strategy, says AML Chief
Agboola Mabinuori BSc, MBA, ACCA DipIFRS, CISA, FCA, founder and Chief Executive Officer at Accretion Maven Limited, a finance and accounts professional with proven industry experience.
