How Can CFO Become The Best Partner Of Company Boss?

　　 supervise

It is hard to get inspiration that regulation will have a huge impact on the future role of CFO. In the United States, the extensive "Dodd Franck bill" passed in July 2010 is undoubtedly the most important legislative reform since the great depression. It aims to enhance accountability and transparency in the entire financial services sector, particularly in relation to capital financing and new reporting requirements. The broader regulatory environment of the global economy has not shown signs of cooling down, from the persistent turbulence of the adoption of international financial reporting standards (IFRS) and accounting standards, to the development of the III Basel (Basel III) and the laws and regulations in line with the national conditions of various countries. Social and environmental problems emerge one after another, thus affecting regulatory reporting requirements. As companies expand overseas, the complexity of the relationship between management and regulation is also increasing. The change of regulatory environment will become a bigger problem.

CFO is becoming more and more necessary and has more and more responsibility to uphold and abide by regulations. They are now investing more personal resources in handling regulatory affairs and lobbying policy makers to ensure that new regulatory requirements can bring benefits to enterprises. Future CFO needs to prevent legislation that is too cumbersome and cumbersome. They will need to lobby on behalf of enterprises, implement business processes and agreements that do not require more regulation, and influence the development of relevant policies. They also need to ensure that financial functions of enterprises have professional ability to solve regulatory problems.

　　 Globalization

The globalization of enterprises has played a role in CFO. Financial functions The composition of the Department has a significant impact. This effect will continue to increase in the future. Future CFO relationships will be global and often virtual, and informal conversations in the corridors will continue to decrease in the past.

Enterprises are rethinking their business models and strategic positioning. Global experience will be a basic requirement for future CFO resume. The basic quality of CFO will be the understanding and understanding of how to implement different business models in specific regions or countries in the face of different strategic challenges and situations.

Expansion has brought new pressures to businesses, such as how to finance new markets and ensure compliance with additional local regulatory frameworks and requirements. The financial function department must have strong adaptability because it simplifies different rules and regulations into the general financial activities of enterprises, and CFO must arrange how to make the financial functional departments best support the expansion of enterprises to emerging markets.

The tactical problem is one thing, and the relationship between culture and cross-border work is completely another matter. As financial responsibilities become more and more internationalized, CFO needs to guide financial functions across different cultures, work practices, beliefs, languages and time zones, and have vision for them. Global leadership will become the cornerstone of future CFO roles.

　　 technology

The emergence of large and complex data, while challenging financial functions, also provides important opportunities for enterprises to analyze business. We hope that financial functions and CFO will be at the center of this data revolution. Analytical tools with more powerful predictive capabilities are constantly being introduced. The increasing intelligence and performance of mobile devices, such as tablet computers, are also promoting a revolution in personal and business ecosystems.

Technological upgrading can collect, collate, standardize and generate data in a more timely manner. This will help to obtain more effective business information, identify new market opportunities and profitability opportunities, assess and manage corporate performance, simulate operational environment, or collect customer opinions. Future CFO and their financial functions must be very good at using this technology. In theory, this means that the time for recording and verifying data will decrease, and the time behind the associated data and analysis data will increase, that is, more financial perspective will be applied to enterprise decision making.

Analysis enables business information to be further refined. It involves not only querying data and reporting information, but also connecting data points, returning, linking, evaluating and predicting future business possibilities. For example, when analyzing customers' interest rates, business messages can identify which customers contribute the most to corporate profits, and data analysis will explain why these customers contribute the most.

Prediction analysis, that is, predicting future performance based on past performance of enterprises, will be the key driving force for CFO and their financial businesses in the future. However, in the turbulent times now facing enterprises, scenario planning and stress testing will increasingly become the top priority of financial functional departments. The next question becomes how to divide the boundaries - useful schemes and parameters are always very limited.

Another question is who will control this great opportunity? Business information and subsequent analysis are initially developed in the field of computer science, information systems and marketing. Financial professionals are the analysts that business takes for granted. From this point of view, analysis will increasingly fall within the scope of management and responsibility of CFO.

　　 risk

For the future CFO For example, the board of directors will be more rigorous in reviewing the effectiveness of the risk management process, and the expectation for the adequacy of the long-term financial plan will also increase. On the financial viability of enterprises' long-term economic success and growth strategy, investors with vested interests and other stakeholders will also seek greater assurance.

The emerging risk management approach will bring new value to understand the breadth of risks faced by enterprises, but it needs to ensure that the process is more open and transparent. The risks and opportunities faced by enterprises should be considered as interrelated portfolios and need careful management, estimation and financial projections. Future CFO and their financial functions will be more able to calibrate the risks faced by enterprises than anyone else, and suggest appropriate actions.

We are familiar with the causal relationship between bad corporate behavior and risk. Future CFO will be seen as an internal guarantee for better corporate climate. But that does not mean that the sole ownership and responsibility should be attributed to CFO. Other members of the board must also do their best and set the tone from top to bottom, but in the end, CFO is still protecting enterprise assets, and should realize that bad corporate behavior can lead to erosion of enterprise value.

For the future CFO, entering the capital market will also become a more important priority. In today's more unstable economic environment and more uncertain investment environment, ensuring the proper balance of corporate capital will pose a more important challenge to financial leaders. In the future, CFO will need to ensure that the appropriate policies related to capital investment, cash supply and shareholder returns will be implemented more effectively than ever before. Effective balance of risk and return will become crucial.