What are the Qualifications and Skills You Should Look for in Hiring a CFO?

Chief Financial Officers (CFOs) are a vital teammate in the success of a growing, middle market business. Among their various roles, they oversee the economic risks and growth opportunities within an organization.

They are imperative to the success of the company. It is their job to manage for high quality enterprise ventures, put together financial reports, and work with different executives to make sure that they are on the right track in attaining the company’s goals. In order to accomplish their duties properly, CFOs must have the proper skills.

CFO Skills Needed

The skills of an effective CFO vary from company to company. However, there are some simple requirements for all CFOs. First, the candidate needs to have at least a Bachelor’s degree in Business Administration, accounting, finance, economics, or a different associated field. Additionally, a CFO should have valuable working experience in accounting and finance with other companies. Finally, a CFO should have strong managerial and decision-making experience.

Aside from these, a CFO ought to have a broad set of “soft skills” including strategic vision, team orientation, a disposition to work collaboratively with the CEO and other managers, the ability and willingness to delegate and internally driven ethics that demand that he always chooses the honest and complaint response over a response that will yield an immediate result, or at least the appearance of a particular desired outcome.

Let’s take a look at the competencies and skills that a CFO needs to possess to help your company thrive.

Problem Solving

A CFO will need make important decisions nearly every day that affect the future of your company. One of the talents the CFO must bring is to be a “quick read” to see problems others might not notice, and to offer solutions to those problems. Sometimes the solutions may be as simple as something he can provide with a spreadsheet. Other times it may require the engagement of internal team members, and still others might involve looking to third parties to resolve, as in the case where a software conversion might be the only to achieve the outcomes desired by management.

Leadership Skills and Strategic Vision

Whereas a Controller or managerial accountant may be able to provide sound numbers, analysis and financial reports, the CFO needs to be able to use all of the above in order to advise the CEO and Board on the important strategic decisions the company should consider. The CFO should guide these decisions, both in terms of deciding what the options might be, and then pointing out the best way to pursue the particular option chosen by the management team. At all times, the CFO is a primary influencer. She is not in the room to be the final arbiter, but instead to be the primary advisor on the most important decisions the CEO and Board will ever make. Trust then, is essential between the management team and their Chief Financial Officer.

Cash Management, Financial Accounting, and Corporate Finance Competence

Down the list from problem solving and leadership, core competencies for a good CFO include a solid understanding of financial accounting, the ability to oversee cash management (or treasury) of the enterprise, and all aspects of corporate finance. This set of skills is inherent with the job of CFO.

Strong Work Ethic

Similarly, it is equally inherent that a CFO will be a person possessed of a strong work ethic. In a marketplace where remote and fractional CFO work is rapidly becoming the norm, the definition of “strong work ethic” has to expand beyond the old notions of long hours in the office. Instead, productivity is absolutely tantamount. Productivity for the CFO is measured against comprehensible metrics. There is also a vital component of determination to get the job done. So for example, if the company has decided it needs to obtain a $5,000,000 line of credit, the CFO should stay the course, be involved late at night or early morning, whatever it takes to get the financing needed for company growth in place on a timely basis.

Trustworthiness

A CFO is a primary, financial fiduciary for the company. There is an investment of trust that comes with the role. Any breach of that trust is immediate cause to terminate the relationship. But this rarely happens. Why? Because CFOs tend to be among the most trustworthy business people you can have on your team to begin with. Moreover, as time goes on in working with your CFO, the things he accomplishes for you become the past measure of his ability to succeed in the future. Each small success begets more trust as the relationship moves ahead. While high turnover is common in many corporate roles, for the CFO, even if he is fractional and remote, it is quite common that the only time you would see him leave the organization is when there is an exit, or buyout of the company.

Conclusion

While the foregoing does not endeavor to create an exhaustive list of the skills you should seek when hiring a CFO, it certainly comprises the most important of those skills the trusted financial professional you hire should come to you with. If you can use help assessing your needs for CFO level services, please use schedule a time for a conversation with a trained professional at Landmark Advisors today