The evolution of CFO to CVO
In today's rapidly changing business landscape, the role of the Chief Financial Officer (CFO) has evolved beyond traditional financial management. Organizations are now expected to report on non-financial and value-centric aspects of their operations, which has led to the emergence of the Chief Value Officer (CVO).
In exploring the role of the CVO and how the role of the CFO is changing, the Association of Chartered Certified Accountants (ACCA) and BDO Global developed a report: Chief Value Officer – The Important Evolution of the CFO. We consulted nearly 100 finance leaders from across the globe, representing a variety of organizations from large corporates to start-up businesses. The report focuses on two key questions:
- What do we mean by the term ‘value’?
- Is the CFO responsible for value measurement in organizations or is there a separate CVO role developing?
To find out the answers to these key questions, download the report now.
Report highlights
Defining value
The report finds that there is no uniform definition of value. Value relates to the relative importance of an item or service that might, or might not, be measured in financial terms. What one individual may perceive as the value of an item or service may be different from another’s view.
To determine whether the CVO role is an evolution of the CFO role, or of the finance and accountancy profession, we need to examine two aspects. Firstly, what we might consider in line with the concept of value and, secondly, how the CFO role is itself developing. If there is a CVO role, what is the value that the role is managing?
This report looks into the concept of value and the processes by which organizations enable and convert value for the benefit of its stakeholders.
The changing CFO role
For many CFO’s, the core need for financial acumen remains, together with responsibility for the financial processes, performance management, and external reporting. They also have a duty to create value for the organization beyond financial performance. This can be challenging as it requires managing data integrity, especially for non-financial data used in external reporting. The CFO must also possess strong project management skills, be an effective change leader, and an excellent communicator. While ethics and values remain as key pillars of the CFO's role in representing the organization to stakeholders.
The future of the CFO role
Sustainable organizations aim to balance economic, environmental, and social dimensions for long-term value creation. Finance teams must demonstrate progress towards this goal, from strategic direction to external reporting. The concept of a CVO aligns with these values as a longer-term leadership concept for organizations. However, creating value is a collective responsibility of the board and senior management. CFOs already play a significant role in value creation and can be seen as CVOs. While rebranding the CFO role is optional, the CFO's inherent values are essential to value creation and should not be lost. In creating value, CFOs are key players for many organizations.
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