Steve Voskuil, CFO of The Hershey Company.
Erica McLaughlin, CFO of Cabot Corporation.
Sandra Clarke, CFO at Blue Shield.
While these individuals will have traversed very different paths to get to the C-Suite, they all have one thing in common: they were an accountant at one stage in their career. In the UK, nearly a fifth (18%) of CEOs of the UK’s largest businesses possess an accountancy qualification, and over half of the FTSE 100 CEOs have a finance background.
The world of finance is an intricate ecosystem, with different roles contributing to the overall financial health and success of an organisation. Among these roles, the CFO stands out as a critical leadership position. However, an intriguing question that often arises in industry discussions is the suitability of accountants to step into the shoes of a CFO.
The Foundation: Skills and experience of accountants
Accountants, often regarded as the financial backbone of a company, are well-versed in managing financial records and ensuring regulatory compliance. Their expertise lies in their attention to detail, accuracy, and a deep understanding of financial reporting, business operations, and financial management. These intrinsic skills make accountants a valuable asset to any organisation.
Financial management and regulatory compliance
Accountants are adept at financial management, which forms the core of the CFO role. Their proficiency in analysing financial data, preparing financial statements, and employing strategies to minimise risks and maximise returns aligns seamlessly with the CFO’s responsibilities.
Understanding of business operations
A significant aspect of an accountant’s role involves understanding and managing the financial aspects of business operations. This understanding equips them with the knowledge to make informed decisions that can affect the company’s bottom line, offering a strategic advantage in the CFO role.
The Leap: Challenges in transitioning
While accountants possess a strong foundation for the CFO role, the transition does not come without its challenges. The CFO role requires a broader scope of responsibility, decision-making authority, and strategic thinking.
Scope of responsibility
The CFO’s role extends beyond financial management to include strategic planning, risk management, and stakeholder communication. This expansion in scope can pose a challenge to accountants who are used to more operational roles.
Decision-making authority
As a CFO, one needs to make high-level decisions that can significantly impact the company’s financial health. Accountants, who usually work under supervision, may initially struggle with this increased level of responsibility.
Strategic thinking
The CFO role demands a strong strategic mindset, a quality that is not typically associated with accountants. While accountants excel at analysing data and ensuring regulatory compliance, they may need to develop their strategic thinking abilities to succeed as a CFO.
The Journey: Preparing for the CFO role
Transitioning from an accountant to a CFO is a journey that requires strategic planning, professional development, and an openness to learning. Below are some steps that accountants can take to prepare for this career move.
Acquiring additional qualifications and training
To increase their knowledge and credibility in the industry, accountants should consider acquiring certifications like the Certified Public Accountant (CPA), Chartered Financial Analyst (CFA), or Certified Management Accountant (CMA). These certifications can validate their expertise in accounting, financial analysis, and management, which are essential skills for a CFO.
Gaining practical work experience
Accumulating several years of experience in accounting or finance positions is paramount for aspiring CFOs. It is beneficial for an accountant to gain professional experience in different aspects of finance and accounting, financial reporting, budgeting, and tax planning.
Developing leadership and interpersonal skills
The CFO role requires strong leadership and interpersonal skills, as the CFO often collaborates with other executives and leads a team of financial professionals. Fostering communication, negotiation, and team management abilities will make one more effective in the CFO role.
Networking within the industry
Building a robust industry network is a good way to start the CFO journey. Attending conferences, seminars, and workshops can provide opportunities to meet and connect with industry professionals, gain insights about the industry, explore job opportunities, and build relationships that can advance their career.
Ascension to the C-Suite
While the transition from accountant to CFO can pose challenges, with the right preparation and mindset, it’s an achievable goal. Accountants bring a strong foundation of financial management skills and regulatory knowledge to the table, which can be leveraged in the CFO role.
By undertaking additional training, gaining practical work experience, and developing leadership skills, accountants can successfully transition to the C-Suite and contribute significantly to their company’s growth and success.
Accountants aspiring to become CFOs need to view their career progression as a journey, one that requires continuous learning, strategic planning, and a commitment to professional excellence. With dedication and perseverance, an accountant can indeed make a successful CFO.