CFOs transforming role as strategists, catalysts

MANILA, Philippines - In the quest to drive sustainable growth, the chief finance officer (CFO) proves to be a necessary partner of the chief executive officer (CEO).

The role has now shifted towards being a strategist and catalyst – not merely crunching numbers or performing transactional work.

Dr. Eliseo Aurellado, former head of the Finance Faculty of the Ateneo Graduate School of Business (AGSB) and lead author of the 2014 CFO study conducted by the graduate school and the FINEX Research & Development Foundation (FINEX Foundation), said the CFO’s ability to step into the shoes of the CEO has in fact become one of the main criteria in the ING FINEX CFO of the Year search.

“Now we really see the CFO and CEO as complementary roles. While the CEO may be the visionary, the CFO must be a willing partner in strategy formulation objective-setting given the wealth of financial information at his disposal,” Aurellado said.

 He added that the recent global financial crisis, for instance, allowed CFOs to instill cost-consciousness in nearly every aspect of the business. The CFO is in fact deemed the “CEO in disguise,” he stressed.

Panelists at the CFO roundtable, some of them past ING FINEX CFO of the Year awardees, echoed the findings of the AGSB-FINEX study, citing that present Filipino CFOs come from diverse backgrounds and do not necessarily come from an accounting discipline. 

2014 CFO of the Year awardee Jose Jerome Pascual was an industrial engineer prior to making his way up and assuming the finance director and country controller roles at Shell Philippines Exploration B.V. For him, it’s about a CFO’s ability to shift role.

“In our own survey, we learned the CFO is expected to protect the company’s reputation. I myself act as an integrity champion,” Pascual, who is tasked to monitor legal experiences in other countries to ensure the local Shell office is adhering to a global framework of ethics and compliance, he said.

Ayala Land Inc. senior vice president and CFO Jaime Ysmael, who bagged the CFO of the Year title in 2011, affirmed the value creation, and not just transactional functions of the CFO.

He said the transactional work is left in the capable hands of the controller, treasurer, and other finance officers under the CFO’s watch, while the CFO himself focuses on strategic aspects such as performance management, representing the firm in initiative and industry programs, and advocating industry laws.

Ysmael also calls for a general rather than a specialist approach to being a CFO, mastering various areas such as accounting, human resources, and communications.

“CFOs should learn and evolve,” said SM Prime Holdings Inc. executive vice president Jeffrey Lim, who was the 2012 CFO of the Year awardee.

“What you do today will be different five years from now. A finance background is a differentiator – but you will be given responsibilities outside of that,” said Lim, who was appointed CFO of the largest Philippine retail and shopping mall operator during the 2007 global financial crisis.  

According to the AGSB-FINEX study, other forces that push for a rethinking of the traditional CFO role include the shift from mechanical to digital in the workplace, as well as expanding from local to global markets.

Since it started in 2007, the one-of-its-kind 2015 ING FINEX CFO of the Year search, sponsored by Dutch banking giant ING Bank and the Financial Executives Institute of the Philippines (FINEX), has been paying tribute to the country’s topnotch CFOs, who help drive their enterprises’ sustainable growth.

“For a business to ensure its sustainability, companies rely on the CFO’s ability to play multiple roles: as a strategist, a catalyst, a steward, and an operator, particularly in this time of volatility and business uncertainty,” said Consuelo Garcia, country manager of ING Bank in Manila. “This is why the bar is getting higher every year that we hold the search for the next ING FINEX CFO of the Year.”

The CFO Roundtable served as a prelude to the formal awarding ceremony of the 2015 ING FINEX CFO of the Year, who will be named on Nov. 25 at the Makati Shangri-La Hotel.