Reaching for the summit - from CFO to CEO
Is the recovery opening up opportunities for ambitious finance chiefs?
This year will be another seminal year for the chief financial officer. Consider the circumstances: the recovery is still merely a gleam in the eye for many boards both in the UK and abroad. Far from being behind us, the recession continues to exert its grip over a broad range of sectors. And that’s before the worst of the coalition’s austerity measures begin to bite.
In that context, there’s little doubt that the CFO will once again be at the fore. Since the financial crisis first took hold, the finance function in many companies will have been at battle stations, ensuring businesses rationalise and toughen up as the hard times began to bite. It follows, therefore, that many CFOs will have seen their profiles raised.
But there’s more to it than just the cliché of “the tougher the times, the better the chance for the CFO to make their mark”, and a recent Deloitte survey showed that while times are still certainly challenging for corporates, the coming 12 months will present an even stiffer challenge: identifying and going after growth.
A growing number of CFOs are turning to growth strategy policies, according to Deloitte’s recent CFO survey. Indeed the top priority is now expansion and increasing cashflow. The narrative for the ambitious CFO in the UK in 2011 must now be: you’ve shown us you can navigate through the storm, now can you steer us towards growth?
It’s a perennial conundrum – can the CFO really make a strategic difference to the business’s performance, and if so should they be stepping into the chief executive’s shoes? There are certainly a number of examples of CFOs doing just that.
“There are good examples of CFOs who have made extremely effective CEOs recently,” says Margaret Ewing, senior partner at Deloitte and a former FTSE 100 FD herself. “Look at Ian Livingston at BT and David Nish at Standard Life – they are incredibly good in that role.”
In Ewing’s view, the success of these high-powered CFOs, coupled with the recent appointment of Colin Day, ex-CFO at Reckitt Benckiser to the chief executive’s job at Filtrona, shows that for many corporates elevating a CFO into the chief executive’s chair is no bad thing in the current climate.
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