The CFO of the Future What it takes to succeed. Panel Session

Transcription

1 1 The CFO of the Future What it takes to succeed Panel Session

2 OUR MODERATOR Mr. Deepak Narayanan Founder and Director, MyCFO

3 OUR PANELISTS Bassam M. Asiri, Head of Transaction Development, Saudi Aramco Mrs. Reem Al Anbari, CFO, Borouge Dr. Ammr K. Kurdi, Group CFO, Amiantit Company Mr. Sridhar Iyengar, CFO, Aerospace, Renewables & ICT, Mubadala

4 4 The CFO of the Future What it takes to succeed Panel Session

5 5 OUR PANELIST Bassam M. Asiri Head of Transaction Development, Saudi Aramco

6 From bean-counter to boardroom "It is not the strongest of the species that survives, nor the most intelligent it is the one that is the most adaptable to change. - Charles Darwin 6

7 Changing corporate environment The evolving corporate environment presents increasing challenges to the CFO Corporate size and complexity growth Media and social media exposure Automation of traditional finance functions Activist shareholder participation More frequent cycles Accounting standard evolution These are but some examples of challenges modern CFOs face. The role of the CFO is evolving to address new challenges! 7

8 CFO of the future addressing the challenges 1 Leveraging the impact of new technologies and automation 4 Focusing on operational improvement and value creation 2 Strategic leadership 5 Driving innovation 3 Proactively respond to changing regulatory environment 6 Leading the transformation 8

9 1. New technologies and automation in finance Examples of new tools in the CFO s toolbox: Real-time analytics / flexible performance management Standardized reporting Big data / Cloud computing AI innovation Challenging traditional models These help CFO to minimize time spent on routine and frees time to: Improve data quality Focus on planning and analytics activities Agile support of business activities 9

10 2. Strategic leadership Background in finance grants CFO a systematic and objective view to company s operations CFO s are in a position to develop an unbiased end-to-end view of the company s value chain CFOs typically have the access and visibility into all organizational data and can identify meaningful correlations and operational drivers They also have the best understanding of the financial impact of any corporate decisions or macro-economic changes With the holistic view, CFOs are well positioned to analyze and influence their corporation s strategic decisions 1

11 3. Addressing regulatory challenges The broader drive towards increasing regulatory control across the global economy shows no sign of cooling down Continuous evolution of accounting standards Cross-border business relationships bring additional complexity through regulatory inter-relationships The CFOs also has to ensure that the finance function has specialist expertise to resolve regulatory challenges 1

12 4. Hands on the operations The current trend is towards the CFO position becoming closer to the business and business leaders acquiring more financial acumen the border between finance functions and operations gets blurred More and more companies are eliminating the COO position and handing operating duties to the CFO Only 33% of Fortune 500 and S&P 500 companies still have Chief Operating Officers, a decrease of 45% from Rise of the Operational CFO Identifies operational challenges and comes up with solutions Understands the ins and outs of the business from a grass-root level Knows the impact of operational changes on the financials 1. Crist Kolder Associates

13 5. Supporting and fostering innovation CFOs is not so much to play the role of a naysayer but rather to be the voice of reason as the proponent of the data-rooted business model CFOs manage the overall level of risk in innovation projects and ensure the core business does not get fundamentally hurt. This allow innovations teams to pursue initiatives that might have a higher level of risk CFOs can utilize portfolio approach to innovations: suitable balance between core, non-core and transformational innovations Employment of suitable metrics to value innovations. Stringent ROI and cost-benefit based metrics impose too high hurdles and kill innovation 1

14 6. Leading transformation Transformations are large-scale efforts that run throughout all the layers of a company CFOs are ideal candidates to play Leading role in the transformation efforts. They are familiar with the many activities and initiatives that underlie the transformation CFO s toolkit: Establishing a clear financial baseline Analyzing which initiatives create value Ensuring that targeted returns materialize to bottom line Leading by example: ensuring the financial function is able to support the transformation CFOs can help companies successfully realize the full potential of a transformation by helping to focus on the activities which truly add value 1

15 The evolution of CFO CFO used to be focused purely on financial aspects of the company New challenges require CFO to assume new roles, more focus on strategy, people, communication and analytics Where CEO is the external face of the company, the CFO is often the internal face a builder of trust There is no single role of a CFO. It depends on the organization s needs 1 Traditional Financial steward - Balance sheet management - Periodic reporting - Tax management - Regulatory Compliance Modern Business leader - Visionary - Driver of corporate strategy - Architect of value creation - Partnership builder

16 Conclusion The modern CFO is often the right-hand man or woman of the CEO and the role now requires someone with a dynamic background far beyond finance. - Matt Egan, Fox Business The CFO job is a tough job, and it's a little bit all over the place. - Dan Ryan, PwC 1

17 17 Q&A Session