A chief financial officer, or CFO, is a great role to aspire to for anyone who works in finance. It’s one of the elite positions in any company, and usually commands a large salary.
A Chief Financial Officer (CFO) is one of the highest-ranking executives in a company, and reports directly to the Chief Executive Officer (CEO). Although the role of the CFO will differ from organization to organization, their main responsibility is to manage the company’s finances, including profit and loss reporting, budget allocation, financial forecasting and financial risk management.
There is no single pathway to becoming a Chief Financial Officer. CFOs typically have a strong educational background with a high level of leadership experience in business, accounting and financial management.
If you’re envisioning your future as a CFO, make it a bright one.
If CFO is your dream role, you’ll need to make sure you have the right qualifications.
An organization’s CFO has a large say in the business strategy and steers revenue flow developments and funding decisions. The principal expectation from them is to be first-rate in financial analysis and budgeting skills. They must have profound knowledge of tax codes, cutting costs, and building equity/revenue. Finances and money are arguably the greatest priority of any organization.
CFOs tend to have strong leadership skills, as well as sound judgment and a proven track record of success over time in the area of financial management.
A CFO must possess strong interpersonal and communication skills, both verbally and written and must be able to engage with staff at all levels of an organization. In publicly listed companies the CFO is often required to represent the company at investor relations meetings.
If you're an accounting or finance professional with your eye on the C-suite, specifically the job of chief financial officer, you should take a moment to make sure you know how to become a CFO.
The right CFO career path can take you to the top job of leading a company's financial operations and overall development, with responsibilities that can range from identifying growth targets to preparing the organization for a sale or even salvaging an underperforming business. Attaining the top position in the financial role takes careful preparation.
A range of skills is required, as well as a broad focus of your business, advanced education and credentials, and corporate experience. You need to know not only the numbers but also your company's operations, products and services, customers, vendors, employees and shareholders.
You’ll need a bachelor’s degree. Most likely, you’ll also need an advanced degree to carry you forward. Pay special attention to degrees and programs that give you a solid grasp in accounting plus other financial skills. Your competition probably has an MBA, but remember that not all MBAs are created equal.
Actively choose jobs that broaden your financial experience. In addition to accounting, consider positions that demonstrate budgeting, analysis, risk management, investing, and more. The more well-rounded you are, the stronger candidate you become. You can do this in a variety of jobs, or you can work your way through one company. If the former, it’s wise to stay in the same industry to deepen that experience as well. Many people also pursue a CPA license for this purpose.
You’ll need to know more than just finances. Look for opportunities to widen your customer service experience, business and operational expertise, technological literacy, and leadership skills.
Career networks can put you in touch with the right people when you’re ready to become a CFO. Join one sooner than later to begin forming connections. Consider the presence of network opportunities when you pursue your MBA or advanced degree. Some programs have career networks which you can leverage while you study.
Done everything above? Think about sharpening yourself with a board-readiness program. Deloitte recommends that professionals seeking an executive position attend board-specific training to develop a deeper understanding of what’s expected of you in the C-suite.
Gaining a deep understanding of the business is critical on the CFO career path. As a CFO, you'll regularly meet with the board and collaborate with managers. For this reason, you need a broader understanding of the business and operational sides of a company.
The insight and support of an experienced mentor can be effective at this stage, as can cross training and job shadowing. Taking a leadership position at a nonprofit or industry association also can offer valuable training for future CFOs by providing exposure to a broad range of business processes and challenges.
Be sure to develop relationships with people at all levels of the company, both within and outside your department. Improve your communication and presentation skills. Position yourself as a team builder.
Not only as CFO will you be responsible to the board regarding the financial status of a company, but you'll also speak with investors. You'll serve as a conduit between what they want to see from the company and the board. These corporate communications will be frequent, as investors are key stakeholders of the business.
With more number-crunching in the cloud, Software as a Service, big data analysis, cyber security and other innovations permeating the finance industry, part of the CFO career path is understanding the benefits and risks associated with technology.
More companies are finding they need big data experts, and they can get them by building technical competence from within their finance and accounting departments. While you may not become an expert in this realm, it wouldn't hurt to familiarize yourself with data retrieval, interpretation and analysis.
Like certifications, certain job titles have been held previously by today's CFOs. Some have held positions of increasing responsibility within an accounting department, such as internal audit manager, director of finance or controller. Getting broad corporate experience in a treasury function, as an example, can increase your experience with funding and strategy execution, both of which are essential for CFO duties.
The influence of CFOs within their organizations continues to expand. At many companies, the roles have expanded outside of traditional accounting and finance, to human resources and information technology.
Leading a business is also getting harder, recent research has shown. In a Robert Half survey, 66 percent of CFOs said it is more challenging to be a company leader today than it was five years ago.
Between new roles and continuing education, it may take some time to get there, but many who have taken the time to learn just how to become a CFO and follow that path find it's worth the journey. Start now to position yourself for success.
A CFO is the senior financial manager responsible for overseeing and managing the financial actions of a company. Like a treasurer or financial controller, CFOs often manage an organization’s finance or accounting departments.
However, unlike a controller, the CFO makes decisions that have an impact on the overall direction of the company. For example, a controller may review financial statements to audit them for accuracy and adherence to regulatory compliance. In contrast, the CFO reviews those same financial statements to analyze them before making recommendations to improve the company’s financial performance.
CFOs are the highest port of call for all financial decision-making in an organization and are expected to assume their share of leadership responsibilities. They’re in charge of managing departments involved in purchasing, pricing, investments, tax, debt management, and accounts payable.
After becoming a Chief Financial Officer, you would be responsible for overseeing transactions made by these departments, recording them in books or databases, and reporting them to upper management or presenting records to external auditors.
CFOs are also responsible for ensuring financial compliance management is met by their organization. To achieve this, they need to research and audit all departments to make sure they’re following local and federal laws and guidelines.
Traditionally, the CFO heads the finance or accounting department. Here, you may manage a range of professionals, including:
However, any financial hierarchy within a company will fall under your leadership. In general, if any planning or analysis requires the input of an expert on the financial impacts, you can expect to be tapped for your advice.
Get ready to showcase your flexibility, adaptability, and willingness to be proactive in supporting sustainable growth. The CFO is one of the fastest evolving positions at the executive level thanks to rapidly advancing technology and shifting expectations about the way we do business.
It’ll probably come as no surprise to hear that you need a lot of experience to reach CFO level. It’s definitely not a role you can take on straight after school or university.
Most CFOs will have an educational background in finance, business, economics or management. A typical route would be to do a bachelors and masters degree in accounting or other finance-related studies, alongside a professional finance qualification, such as ACCA or CIMA.
While education and the relevant qualifications are all-important, the quality of your working experience and professional track record are the best tools for potential CFOs.
There used to be quite a rigid path for CFOs - going from accounts assistant to controller and treasurer, then on to CFO - but modern times call for modern CFOs.
There are opportunities to expand your experience in sales or operations into finance. The modern CFO needs a breadth of experience - they need to understand, and have experience, company-wide.
No matter what your background or education, the role of CFO is not one to take on lightly. Immensely rewarding, but the financial weight of a company is on your shoulders.
As a CFO you will hopefully have a very successful career at the top of the ladder, but a huge amount of responsibility and expectation would lie with you.
Read – evolutions of CFO
You’ll need a bachelor’s degree to become a CFO. The U.S. Bureau of Labor Statistics notes that the most common are finance, public accounting, economics, public administration, and business administration.
A master’s degree – usually in one of those same fields – also comes highly preferred due to the level of management you’ll demonstrate every day. Common master’s degrees include:
Earning a master’s degree in accounting lays the educational foundation for aspiring CFOs. However, earning further certifications and licenses can increase potential upward mobility. Holding certifications and licenses can set applicants apart and one day put them in the lead for a CFO position. While not comprehensive, the following list offers a selection of possible continuing education certifications for finance and accounting professionals.
If serving as a CFO is on your professional bucket list, be prepared for the long-haul. According to one interview with a CFO, potential prospects typically have around 10 years of related background and experience before seeking the position. If you’re laying out your career planning early in your professional development, you can take steps to accelerate your trajectory – such as picking out a business school with a proven track record in helping students achieve their career goals faster.
You could take many different paths to become a CFO. Finance- and operations-related roles include responsibilities that are sought-after in Chief Financial Officers such as resource management, people management, and the right balance of technical expertise, theoretical knowledge and leadership. Managers and directors in those sectors are natural candidates for the position.
A CFO is responsible for the financial planning and record keeping of a company, as well as managing financial risk.
In short, a good CFO supports the chief executive officer (CEO) and communicates key information and concepts to the board of directors so they may make the best decisions for the company. In addition to the skills and abilities already discussed, a CFO must also have the requisite financial and technical knowledge needed to become a CFO.They report to the company’s higher management - usually the Chief Executive Officer (CEO), plus board members. The CFO is one of the highest positions in large companies.
Chief financial officers (CFOs) play a central role in helping organizations navigate the complicated business world. While in the past a company’s CFO traditionally focused on its finances, as the business world has evolved over the last several decades, the expectations and demands placed on CFOs have intensified. Their roles within a company have greatly expanded. CFOs have gone from being guardians of organizations’ financial health and overseeing the financial control infrastructure to owning a plethora of responsibilities, such as making strategic and operational business decisions, overseeing compliance and control, understanding and upholding business ethics, and acting in a governance capacity, just to name a few.
Depending on the size of the company, the salary can vary. However, you may expect to be earning over £100,000* a year, with some CFO salaries reaching up to £1million.
Large multinational companies hire outstanding financial experts as CFOs and offer very attractive salaries.
The Chief Financial Officer is a staple in the board room, playing a vital role in keeping the company compliant and profitable. Yet, the route to achieving that coveted role can seem confusing, leading many people to feel as though it remains just out of reach.
With the right preparation and strategy, you can absolutely become a CFO. We’ve outlined what it takes to become one, the skills you will need, and provided some pointers in the steps you can take right now no matter where you are in your career.
The Chief Financial Officer (CFO) is often the ultimate position for a finance career. You’re as high as you can go in a company, the only person above you operationally is the Chief Executive Officer, then there are the owners – entrepreneur, shareholders, chairman – who you have to report to and keep happy. For many CFOs the next challenge is Chief Executive Officer (CEO), company ownership or retirement – so you see, it’s very nearly the final and most senior role for many finance professionals.
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