Activator, Value Creator And Steward – What It means To Be A CFO In 2023

by Wes Bricker

Finance leaders are front and center in communicating with external stakeholders—investors, customers and regulators—who are calling for more transparency around how the company is meeting its commitments. They manage all of this while continuing to provide decision-useful information to the board and CEO. 

©Pict Rider/iStock/Getty Images Plus

The CFO’s world is dynamic, constantly evolving in response to shifts in the company’s competitive market, economic pressures and the impact of new and more complex regulations. Many CFOs are now responsible for far more than a company’s finance function. They work across their enterprise to connect leaders responsible for the company’s climate and cyber risk management, human capital, supply chain, tax compliance and non-financial disclosures.  

These finance leaders are front and center in communicating with external stakeholders—investors, customers and regulators—who are calling for more transparency around how the company is meeting its commitments. They manage all of this while continuing to provide decision-useful information to the board and CEO.  

I regularly meet with CFOs—in roundtable discussions, at events and with those who are PwC clients—and as I look ahead to an exciting 2023, there are three trends shaping the CFO experience: 

  • Evolving from recession planning to innovative action. 
  • Creating growth and value while also authentically meeting employee expectations. 
  • Shifting to an Operational CFO leadership style. 

Recession—it’s a question of “when,” not “if.” 

As finance leaders, CFOs know all too well the impact of inflation, interest rates and a possible recession on their ability to manage costs, pricing and generate revenue. Yet, they've been taking action to get ahead of the economic trends.  

These executives are confident that their experience managing the business over the past few years and their scenario planning have set the company up for success. They are not putting their business on pause or making drastic changes to protect margin. Successful CFOs see the realities of their business, have confidence in their business strategy and have built enterprise-wide teams to translate all of this into action. 

Looking ahead, CFOs will likely remain keenly focused on how the economy impacts their customers, as pricing is a critical issue in today’s inflationary market. When I speak with CFOs, they share an awareness that their company cannot increase prices indefinitely. To generate revenue and keep customers, they’re exploring a variety of options, such as raising prices on some products—however, they are not cutting corners. Some leaders are working across their enterprise to scale down the number of products offered, renegotiate supplier contracts, rethink capital spending and hedge currencies and materials to limit how suppliers’ price changes impact their business.  

As CFOs keep a close eye on the economy, they will also find more occasions to turn uncertainty into an opportunity to innovate, explore new products and adopt new technologies and managed services to create efficiencies. They will continue to work with technology leaders to invest in digital transformation initiatives that will help the company manage costs.  

Balancing the workforce’s expectations and revenue growth 

As leaders continue to guide their companies out of the pandemic, they face two realities. First, the power dynamic between the employer and employee has shifted and will remain fluid for some time. Throughout the pandemic, employees had the upper hand and could command more flexible schedules, higher salary and more personalized benefits. Second, companies are putting the Great Resignation in their rear view mirror, and a new reality is coming into focus: there is no going back to pre-2020 ways of working. 

Most companies are not making wholesale layoffs in preparation for a recession because of a need to protect capital. Rather, they will continue to make strategic hires, such as those with technology or deep sector-specific experience, in the midst of heavy competition for talent. More than half (57%) of CFOs who responded to PwC’s recent Pulse Survey said that in the next 12-18 months, they plan to hire in specific areas to drive growth. 

As a result of their efforts to retain talent and authentically meet employee’s expectations, CFOs are seeing their company culture flourish and they are experiencing more balanced dynamics with employees. They report that their workforce is in the office 2-3 days per week (any more frequency is a turn off to current and prospective employees), and people are embracing this flexibility and the in-person connections they have with colleagues. 

Closer to home, CFOs are also addressing the fatigue impacting their finance team by automating repetitive processes, layering in advanced analytics and upskilling their teams. These teams, which are also facing competition for talent, are managing and planning for more regulation and standards and taking on more corporate reporting in response to growing interest in their ESG data. Interestingly, not all CFOs see outsourcing as a way to relieve these pressures, citing concern that this strategy will drive employees to competitors.  

The CFO’s expanding role 

CFOs strongly believe their role is, and will continue to be, a truth teller and a steward of good governance. I agree. They do more than protect the company—their role and actions serve employees, investors and customers.  

In addition, the CFO’s role will continue to be highly strategic, complex and enterprise-wide. The future-focused CFO is knitting together tax, finance, pricing, economic modeling, compliance, risk management, etc. I define this CFO as the “Operational CFO,” one who is uniquely positioned to lead the company, act as its air traffic controller and connect across the enterprise to find new ways to create value and prioritize governance.  

CFOs are as dynamic and diverse as their marketplace. Their role is critical to how companies deliver on their promise of service, quality and trust. I am excited to see CFOs’ role continue to evolve, as these leaders bring energy and fresh perspectives on risk, return and opportunity to their internal and external stakeholders.  

Wes Bricker is the PwC Vice Chair - US Trust Solutions Co-Leader