International Corporate Finance

As the world changes so must the business

of running it. The role of the CFO is now

involved with not only financial but ope-

rational and IT related matters as they are

made to oversee how technology integrates

with economic as well as operational pres-

sures. Today, we are seeing the number of

COO positions decline which means that

companies will be seeking to incorporate

that role with the CFO’s role. According

to Crist Kolder Associates, among the 672

largest companies surveyed in the Fortune

500 and S&P 500, 15% of CFOs now direc-

tly deal with operational matters and as of

2015 only 33% of companies have COOs,

indicating a significant decline from the

year 2000 when 48.1% of companies had

one. As a result, it is becoming evident that

the role of the CFO will move beyond the

management of monitoring risks to a role

where they will be asked to oversee many

divisions such as investor regulations and

reputation management; risk management;

corporate governance; global marketing;

remuneration policies; and treasury func-

tions.

According to the magazine CFO, over the

HR Changes in the Corporate Sector

last 10 years more than half of the CFO po-

sitions have been filled internally as com-

panies are grooming their talent for the po-

sition. CFOs that fit this description tend to

engage heavily in business operations and

strategy rotations and often bring strong

industry and competitive insights. Howe-

ver, as the number of M&A transactions

increases, it is becoming more important to

hire special profiles. Many investors would

like to see CFOs be proficient in investor

relations within M&A. This emerging trend

was seen in 2015 when 6.8% of all chief

financial officers had investment banking

backgrounds compared to 3.3% in 2006.

Strong communication skills, the ability

to interpret complex financial data, and

a broad knowledge of global economic

markets are only touching the surface of

what today’s CFOs must become really fa-

miliar with. According to a 2016 ACCA

(Association of Chartered Certified Ac-

countants) report entitled “Professional

Accountants-the future,” 55% of respon-

dents from CFOs and their staff expect

that the demand for new skills and com-

petencies arising out of the development

of intelligent automated accounting sys-

tems will have the highest impact over the

next three to ten years.

Other factors include the adoption of

cloud computing, harmonizing business

standards, economic volatility and the as-

pirations and expectations of coming ge-

nerations.

 COMPANIES WITH A COO HAVE DECREASED BY 10% IN THE LAST DECADE

Percentage of Fortune 500 and S&P 500 companies with a COO, 2000-2015

50%

40%

30%

20%

10%

0%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

48.10%

44.90%

44%

33%

36%

36.30%

39.40%

41.50%

41.60%

42.30%

% with COO

Source: Crist Kolder Associates

Source: Based on a survey administered by ACCA

0% 10% 20% 30% 40% 50% 60%

55%

Development of intelligent

automated accounting systems

Rate of change

and economic volatility

Harmonization of accounting

and business standards

Adoption of cloud

computing by businesses

Aspirations and expectations

of coming generations

42%

42%

41%

39%

 TECHNOLOGY HAS THE BIGGEST INFLUENCE

Factors expected to impact financial professionals in the next 3-5 years