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The CFO of today
Q: As the role of the CFO continues to change and broaden in the current operating environment, what are the challenges facing CFOs today?
LIM CHENG CHENG
GROUP CHIEF FINANCIAL OFFICER
"A CFO plays the lead role in resource allocation, which determines a company's ability to compete. In this digital age where everyone is facing disruption, CFOs need to step up as strategists of their businesses. This involves balancing risks with the need to grow new businesses as traditional revenues get eroded. CFOs need to help investors appreciate that there will be short-term pressures on earnings and share price compression as their businesses make the transition to digital.
In this highly competitive era, CFOs like all top management need to fight the war for talent. Besides technical skills and operational experience, people who can drive results, strategy, innovation and lead effectively are increasingly important for any company to thrive and compete in the digital economy.
I'd say a successful CFO is one who inspires the team to drive innovation and change while keeping the organisation lean and adaptable."
CHONG CHOU YUEN
TUAN SING HOLDINGS
"I AM of the view that whatever changes to the role of the CFO, his/her basic priorities shall remain the same, that is to say:
- adding value, contributing more than you cost;
- providing an independent view but behaving like you own the business yourself;
- making a difference, holding yourself accountable for outcome;
- lifelong learning and ensuring employability of your people;
- managing uncertainty and accepting ambiguity, with financial discipline.
We are too well aware of the rapid advances in artificial intelligence, augmented-reality devices and digitisation of practically everything. We should accept this phenomenon as a given, the current constant, and face such big challenges squarely.
In this respect, I would advocate that the CFO shall act
- as a "strategic enabler";
- as a "distraction filter" in the business entity; and
- lead in "future-ready" the workforce.
To be an effective strategic enabler, the CFO, as the guardian of cash and capital, should weigh the risk and rewards in allocating appropriate resources to back business strategies, invest in new technologies or innovative products.
By being an effective distraction filter, the CFO should decide what is important for a business, ignore massive data generated by the information technology that are not relevant or distractive and select and synthesise the truly relevant ones into information.
To ensure employability of the workforce, he/she needs to take steps to invest in training, upskilling the people to be digital-savvy and fostering a culture of lifelong learning, particularly self-learning.
JAPAN FOOD HOLDINGS
"A MODERN CFO has a diverse and sometimes conflicting role and wears many hats as he is the link between regulators, the investment community and the business owners. As a result, today's CFO has a more visible public face than before.
As a steward, he has to establish robust risk management and compliance systems. As a performance driver, he assists the CEO in strategic planning, delivers financial efficiency in funding business needs in order to derive optimum value for shareholders.
He is also responsible for ensuring timely disclosures and balanced communication with external stakeholders to help them gain better insights into the strategic long-term value of the company.
Juggling these roles in today's ever-changing and innovative business environment is the CFO's biggest challenge."