The focus on sustainability has also made their roles more critical. This is increasingly positioning them uniquely for the transition to the top job of the chief executive officer (CEO) when the company needs to figure out succession plans.
Gulpreet Kaur Chawla, Partner, TRANSEARCH India, tells ET Digital the reasoning behind the trend and what CFOs need to do to be prepared to handle more challenges. Edited excerpts of the interaction:
Are you seeing an increasing trend of CFOs replacing CEOs for the top job?
We are witnessing an emerging trend of CFOs being elevated to CEOs. CFOs run the race alongside sales and marketing executives for C-suites jobs depending on market scenario, sector demands or the need of the organisation.
How is this changing the positioning of CFOs internally?
Companies prioritise CFOs over functional heads, especially those who are holding bigger offices. This trend underscores the rising significance of finance. Over the last year, leadership has increasingly emphasised cost structure, with CFOs being pivotal in shaping balance sheets, particularly in startups, laying a robust foundation for growth.
Which are some of the critical roles and sectors where CFOs are gaining more importance?
CFOs are crucial hires for private equity firms and evolved companies due to their ability to work closely with stakeholders, and with strategic acumen and commitment to high governance standards. CFOs play a leading role in IPOs and fundraising, leveraging their networks and influence within the financial community — particularly vital in startups.With every company on some level of the digital transformation journey, how are CFOs aligned to lead this kind of strategic shift?
CFOs are increasingly becoming digitally savvy, and attuned to digital transformation. This is playing a critical role in enhancing business operations and driving automation, thereby adding immense value to organisations.
In terms of skills, as CFOs get ready to make the transition, they need to imbibe the best leadership qualities of leading amid ambiguity, enabling tough stakeholder management and building the right teams for sustained scale.