Insight

Supporting the CFO

As the job of the CFO has become more demanding, the audit committee chair's support of the CFO has become more critical.

Understand that the role of the CFO has become much more complicated, challenging, and demanding in recent years. A critical role for the AC chair is to support the CFO and develop trust before there is a crisis.

AC chairs can support CFOs by:

  • Developing a strong, healthy relationship with the CFO; spend time (informal) with the CFO
  • Focusing on between-meeting developments
  • Helping maintain focus on the long-term financial performance rather than short-term earnings targets
  • Helping inject objectivity into the company’s financial disclosures
  • Helping facilitate effective shareholder communications:
    • Major institutional investors (such as BlackRock, State Street, and Vanguard) continue to emphasize the importance of environmental, social, and governance (ESG) issues (ranging from climate change to diversity) to corporate performance—and as key to long-term value creation and preservation
    • Help shape the company’s key ESG messages to investors and other stakeholders in the context of strategy and long-term value creation
  • Helping ensure that CFO has adequate resources and staff support:
    • A high-performance finance organization is key to success
    • Budget and headcount should increase as CFO responsibilities have increased
    • Focus on hiring, training, and developing talent, including developing succession plans for all key finance staff positions.

Explore all topics in the Role of the Audit Committee Chair report


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