Evangelizing sound sustainability practices and establishing a culture of purpose have a much more significant effect than turning a company into a responsible global citizen. For CFOs, this approach is the earmark of a profitable business. However, this worthwhile aspiration can be one of the most overwhelming aspects of the head finance job – that is, if CFOs do not have access to the right information required to take charge.
The guiding habits of CFOs who are influencers in the boardroom
Finance leaders who lead with sustainability and purpose as their guiding force are the ones who:
- Collaborate regularly and closely with every area of the business
- Maintain a laser focus on driving strategic growth with every action
- Exert strong, data-driven influence in all decision-making
- Operate at a level of effectiveness, efficiency, and speed that serve as an example of how the rest of the enterprise should run
According to the Oxford Economics study “How Finance Leadership Pays Off,” finance executives who faithfully practice these habits are twice as likely to report growing market share, compared to finance functions that do not follow the same direction. In the survey, 83% of respondents at companies with revenue growth of more than 5% over the past year claimed that their finance function’s influence and visibility has increased business-wide. Meanwhile, 79% at companies with 0.1%–5% growth, and 70% of those with stagnant or declining revenue growth, could say the same.
Although these improvements may be good reasons to embrace this strategy, the Oxford Economics study also noted that only 11.5% of finance organizations have reached this level of leadership. This finding may seem discouraging, especially for the nearly two-thirds of CFOs who aspire to become a CEO. However, considering the significant variance in digital and process maturity across industries, regions, and organizational sizes, CFOs can benefit from access to data-driven intelligence without exposing their weaknesses and plans to competitors, peers, and the business at large.
Benchmarking sheds light on how 11.5% of CFOs are getting it right
Most CFOs operate under the established principle “you can’t manage what you can’t measure.” And while this is sound advice, leaders must also learn from everyone else around them to find new ways to improve the business.
For finance organizations, this means benchmarking themselves against companies from other regions and industries, both larger or smaller, and those considered disruptive competitors as well as the least threatening players. And we’re not just talking about finance practices. For example, since the role of the COO has been steadily disappearing over the last few years, CFOs now need to optimize the entire business operation – including governance, risk, and performance; marketing and sales activities; and R&D and engineering innovation.
Under the right conditions, benchmarking surveys can serve as a treasure trove of information into what works well and what doesn’t – from people skills, technology, and processes to change management practices and organizational shifts. A relevant sample based on clear segments of market size, geography, and industries are taken without unveiling personal, privileged information, empowering CFOs to compare themselves against a diverse cross-section of accurate, real-world experiences, not generic results.
Surveys that consider these factors thoroughly (and independently of any technology provider) offer, from our standpoint, insight that can be profoundly transformational. For example, connecting the dots between technology adoption and the people and processes it supports allows CFOs to sift through the noise of the “hottest, sexiest” digital investments. They can find the most valuable solutions and pinpoint a deployment approach that makes the most sense for their situation and will not disrupt the business.
Learning from peers and competitors to actualize your impact
Finance leaders who make periodic benchmarking evaluation as part their research are positioned to find the best practices and technologies for rooting out processes, policies, and partnerships that conflict with running a sustainable, purpose-driven business. For example, CFOs can remove the risk of unlawful employment practices from the supply chain, optimize the use of natural resources on the factory floor, and cultivate relationships with ethical, like-minded partners.
If you think about it, the benefits are just too great to ignore. Isn’t it time that you learn from peers and competitors to gauge your organization’s strengths and weaknesses anonymously and know which resources can jump-start your ultimate business vision?
Benchmark yourself against finance leaders. Complete a seven-question survey to compare your finance organization against performance leaders and your peers across industries, countries, and business sizes.