CFOs think the finance function has held up well through the crisis, on the whole, but are concerned about maintaining productivity and engagement in the long term. One group of CFOs stands out as more optimistic about the future—and somewhat more often already have the leadership skills they need to sustain resilience.

Chief financial officers (CFOs) have been central to every organization’s response to the COVID-19 pandemic. A recent survey of 687 CFOs in the United States shows that CFOs themselves and the function have taken on new responsibilities and are working more. Most CFOs think that the function has been agile and that engagement, productivity, and quality of work have held steady. Looking ahead, however, CFOs are worried about maintaining all three, and the data shows that leadership capabilities such as communication and adaptability will be central to success in the foreseeable future—but just over half of CFOs think those skills are very common in the function today.

The CFOs who responded to the survey come from a broad range of industries, company sizes, and types of ownership.

Responding to the pandemic

Eighty-seven percent of respondents said the finance function was agile or very agile in response to COVID-19, and a strong majority said that productivity, quality of work, and employee engagement have stayed the same or improved. In fact, many CFOs who have joined roundtables hosted by Heidrick & Struggles in recent months expressed surprise that activities that seemingly require a significant amount of collaboration, such as the monthly and quarterly closing processes, were happening more efficiently at the onset of the pandemic.

Two-thirds of CFOs said that new responsibilities have been added to their team’s plate since the beginning of the pandemic. Some of those responsibilities vary by industry, but generally they include cost cutting, real estate evaluation, and new reporting requirements (including new ad hoc analysis requests and the subsequent reporting). Though the immediate reason for greater focus on these areas is the pandemic, CFOs suggested during our roundtables that the elevated focus on these areas will persist.

Nearly one-third of CFOs said they had cut the size of the finance function, and almost as many have added to it. Among those who cut the function, 43% said that 11% to 25% of the workforce was affected, and 5% said that more than half of the workforce was affected.

Seventy-one percent of CFOs said they themselves have been working more than 10% more since the pandemic hit, and 58% say the same for the function as a whole. Most of the added work on the part of the CFOs has been spent on employee health and safety, real estate evaluation, and human resources or employee relations requirements. And indeed, every CFO we’ve talked with in recent months has said that their time has been a juggling act, including the reprioritization of investment projects, support for employees struggling to manage their work–life balance, and, in industries that are growing, competition for entry-level employees.

Looking ahead

We saw a divide when we asked CFOs what they expect for the function a year from now. Those who were optimistic believe the function will grow, will be proud of its innovations, and have stronger culture and morale. Pessimistic CFOs said their function will be smaller and have weaker morale, and that conditions are too volatile to form clear expectations. These varying expectations are likely related in part to how various industries have fared: for example, technology CFOs are most often optimistic. Expectations also correlate with type of ownership—44% of companies owned by private equity firms are in the optimistic group, compared with 31% of publicly listed firms.

Nearly all CFOs, 89%, point to communication as the single most important skill for finance leaders (beyond specific job skills). This aligns with what they say is needed to maintain culture and morale: frequent communication about the company’s purpose and finance’s role in fulfilling it, holding more small meetings with groups of employees, and seeking feedback from all levels of the function about engagement and morale. (For more on communication’s role in maintaining organizational culture and morale, see “Leading through the crisis by counting on purpose and values” and “From blame to gain: Leading with agility in a crisis.”)

But only 51% of CFOs say that communication skills are very common in the function today. That is consistent with other Heidrick & Struggles data, which shows that among 33 leadership characteristics, the highest rank CFOs’ colleagues give them on any communication-related capability is ninth. And in our experience, finance executives who have a strong mix of deep analytic skills, the ability to handle complexity, and the ability to communicate that complexity to a broader audience meaningfully are indeed rare.

There is good news, too, in that CFOs are ranked top by colleagues on purpose and integrity, which is also among the top five capabilities CFOs say they’ll need going forward. Other research we’ve conducted shows that organizations with a clear purpose assess their own performance as more than twice as strong as others. (For more on this research, see “Bringing your organization up to speed.”) And in the survey, optimists far more often cite having a clear sense of individual and organizational purpose as important—60%, compared with 51% of pessimists—and more often say that a clear purpose is common in the finance function today. More broadly, looking at the five skills CFOs most often cite as needed, the optimists on the whole slightly more often said that those skills are prevalent in their organizations today. This may be another reason these CFOs are more hopeful about the future. 

About the authors

Kay Fuhrman (kfuhrman@heidrick.com) is a partner in Heidrick & Struggles' Dallas office and a member of the Industrial and Technology Officers practices.

Acknowledgment

The authors wish to thank Anurag Dang for his contributions to this report.