#cafinal | #afm | ch-1 | Short Class 1.8 | FINANCIAL POLICY & CORPORATE STRATEGY | functions of CFO

CA Final - Advanced Financial Management Lectures - Chapter 1
Class 1.8 - Advanced Function of a CFO
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Traditionally, the main role of CFO was concentrated to wealth maximisation for shareholders by
taking care of financial health of an organization and overseeing and implementing adequate
financial controls.
However, in recent time because of globalization, growth in information and communications,
pandemic situation etc. their range of responsibilities has been drastically expanded, driven by
complexity and changing expectations.
Now a days in addition to fulfilling traditional role relating to governance, compliances and controls,
and business ethics as a part of the leadership of role CFOs are also expected to contribute their
support in strategic and operational decision making.
In post-pandemic time their role has been advanced in the following areas in addition to traditional
role:
a.
Risk Management: Now a days the CFOs are expected to look after the overall functioning of
the framework of Risk Management system of an organisation.
b.
Supply Chain: Post pandemic supply chain management system has been posing the
challenge for the company to maintain the sustainable growth. Since CFOs are care takers of finance
of the company, considering the financial viability of the Supply Chain Management their role has
now become more critical.
c.
Mergers, acquisitions, and Corporate Restructuring: Since in recent period to maintain the
growth and capture the market share there has been a spate of Mergers and Acquisitions and hence
the role of CFOs has become more crucial because these are strategic decision and any error in
them can lead to collapse of the whole business.
d.
Environmental, Social and Governance (ESG) Financing: With the evolving of the concept
of ESG their role has been shifted from traditional financing to sustainability financing.
Thus, from above discussion it can be concluded that in today’s time CFOs are taking a leadership
role in Value Creation for the organisation and that too on sustainable basis for a longer period.
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