We are all acquainted with the term CEO of a company, but have you ever heard about the CFO of the company?
In this case, I am quite sure that even if some people have heard about CFO and know about them, there are many who are totally new to this term.
For them, let us come straight to the question – what is the full form of a CFO? CFO has its full form as Chief Financial Officer.
Now, the question strikes – who is the CFO of the company? The chief financial officer or the CFO of a company, is a senior executive officer dealing with the financial affairs of a company or institution. In this fast paced world, a good CFO is very much vital for the success of any organization and in a similar way, the choice of a bad one can be the reason for the failure of the organisation.
For choosing a good CFO, we need to look for some qualities in a person. So the qualities that a good CFO must possess are :
Qualities of a Good CFO
- The person should have uncompromised integrity and should maintain ethical standards: One of the main qualities is that a good CFO should be trustworthy, honest , ethical and must know how to develop confidence and trust. It’s not a job description but the person should know he is the safekeeper of everyone’s money. Sometimes his role is to deliver the bad news to the CEO, even if it is risking his job.
- The person should have knowledge in accounting, proper cash management skills and also finance competence: For a CFO to be successful, he must possess these fundamental qualities and they are – knowledge in accounting, proper skills in management of cash and also harbour the ability to manage the financial function.
There is no requirement for the CFO to become a CPA, but the person who is appointed should be absolutely practised about how the numbers are generated and should have proper communication skills so as to communicate with the managers, the shareholders, the creditors, etc.
- The person should have Basic Knowledge about Business : It is very important for a CFO to have some basic knowledge about business.The CFO must understand the basic business fundamentals, basic operations of a company and company’s business model. If the CFO does not have any no interpretive ability does not add usefulness to the company.
- The person should possess a Strategic Vision: A strategic vision is very necessary for business.A good CFO should think strategically and should help to create and execute business plans. A strong leadership quality should be demonstrated within the financial and management team. A CFO,who demonstrates no executive presence or hoard information are generally ineffective. The CFO is more likely to be a negotiator, rather than just be a “number’s guy”.
- The person must be a Strong working Enthusiast: Another main quality of a good CFO is thathe should work for long hours and should also be able to process a tremendous amount of workload. The person should pay extreme attention to every minute detail. A CFO should work for at least more than 8 hours a day as working for less than 8 hours will not fulfill their objectives.
- The person must possess the ability of solving problems: A CFO’s knowledge acts like a resource for the company and this also helps to formulate a plan to secure the future of the company. A good CFO should always look for winning situations, rather than closing a good deal. He must know how to handle various situations and must show problem solving nature.
- The person should be good at communication skills: A good CFO must know how to communicate the financial performance and resources of the company to all the key constituents either orally or in written format. A good CFO will be ready with all the answers and convey them to you even before you ask any question, but on the other hand a not so good CFO will give you the feeling – ‘No questions, No Answers’.
- The person should be self confident: To gain trust and keep the trust of all constituents including the company’s employee is another quality that a good CFO should possess. The CFO must be self confident rather than being arrogant. A good CFO must have a willingness to admit his mistakes and should also hold the ability to transmit appropriate messages to the respective audiences. The person should have the ability to offer input without insisting to be right.
- The CFO person should have a result oriented Mindset: In today’s uncertain economy a company needs a CFO who is committed to results first and makes all the efforts to prioritise it. Also, should have the ability to judge the problems when the company is likely to be in trouble. The person should be more focused on the results, should be more result oriented, overcoming the problems which restrict the company to reach to the top.
- The person should be dependable: A CFO who is willing to do whatever it takes to bring results and works reliably under pressure to produce timely and accurate information, is invaluable. The right CFO can help to set the ball
- s in motion. Replacing or supplementing the work of an average CFO can have far reaching negative organizational and economic consequences.
This article has covered almost all the necessary requirements that are needed in a person for being a good CFO. The CFO is a person who is one of the major heads of a particular business and so he should have some qualities that will be beneficial for the company and lead to the enhancement and development of the company.
Do you want to know about the best cfo recruitment? Then here we can provide you with a link that might help you out with your requirements.
Sunny Chawla is a Managing Director at Alliance Recruitment Agency. He specializes in helping client for international recruiting, staffing, HR services and Careers advice service for overseas and international businesses.
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