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Chief Value Officer - the important evolution of the CFO

Date

05 Jun 2023

Sections

Euro & Finance

In the move towards sustainable organisations the role of the CFO is evolving beyond finance to include reporting on value-centric aspects of their operations.

This joint report by ACCA and BDO reinforces that the chief financial officer (CFO) role is fundamental to organisations and their stakeholders. The role continues to evolve and reshape as the emphasis of organisations changes. The role of a chief value officer (CVO) is one that is increasingly used in the context of the broader reporting that organisations are now undertaking. Is the CVO role an extension of the CFO role or is it unique? What constitutes value anyway?

To explore those two questions, this report draws on the views of nearly 100 finance leaders from across the globe, representing a wide variety of organisations from large global corporates to start-up businesses. The finance leaders included not-for-profit and public sector organisations as well as publicly listed and private equity backed entities.

Organisations are increasingly being asked to consider, and to report upon, more value-centric aspects of their operations. There is also an increasing requirement for them to report against non-financial aspects of their operations. With a focus for many organisations on purpose and value, contributors were asked to consider whether there is a trend to asserting the need for a new role of chief value officer and whether this a role that the CFO is already fulfilling.

What do we mean by value?

A model of value

The reality of the CFO role

Value is a long-term concept and one that is aligned to the creation of sustainable organisations. The reality is that for most CFOs the achievement of the strategic goals of an organisation that embraces economic, environmental and social equity is a fundamental part of their evolving role. This is at the core of generating value.

CFOs are increasingly acting as strategic leaders and advisers in their organisations. The CFO role is one that has moved significantly from the traditional view, while retaining the core responsibilities.

The reality of the CFO role

For many CFOs, this role, together with that of other C-suite executives, embraces the concept of value management. CFOs are the accountable face for the delivery of value in their organisations. The evolution of the role is driven, in part, by the expectation of the stakeholders with whom the CFO engages.

While there is a debate as to whether there is a separate CVO role or if it is an extension of the CFO role, many of the CFOs who contributed to this research argued that they were already fulfilling that role.

On this basis, while there is always more to learn, there is no need to rebrand the role, but CFOs need to ensure that they step up to satisfy the required value agenda.

The resulting three key findings from the report are:

1. The concept of value is fundamental to the management of performance in organisations and its adoption is a key element in their path to a sustainable future.

2. CFOs are increasingly adopting a value centric approach in their work and this represents an evolution towards a chief value officer role away from a traditionally financially focused remit.

3. The development path for those aspiring to be CFOs requires an increasingly broad range of experience which embraces both formal and informal learning activities which professional bodies and practices need to engage with.

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