Q&A: Tatum’s Jamison on CFO Tug-of-war

Faced with mounting internal and external demands, finance executives are at the end of their ropes, Cynthia Jamison, an executive-services provider, thinks.

In general, if you had to rank, you do the regulatory stuff first because you have to do your filings and you have to be compliant. You do the board stuff second because the CEO looks bad if the board isn’t happy. And then you do the CEO stuff. What typically falls off is the peer-level support across the organization and the staff training and support.

There’s an awful lot of political maneuvering that can start happening when your peer group gets mad at you and doesn’t think you’re responding to them. They typically will go to the CEO and start agitating and that can get the termination rumblings going. Communicating with your staff, boards, and CEO is important, but peers can also do a lot of damage if they’re not happy.

CFO.com: Why aren’t more CFOs taking the time to effect change in their role?
Jamison: CFOs don’t like breaking their own behavior patterns. Nobody does. It’s very uncomfortable to try to change behavior when you’re older in your professional life and older in your living life, but that is what part of what the solution requires.

CFO.com: How can CFOs explain to their board and CEO that they want to make changes?
Jamison: They need to first start a conversation across to their peer group and up to the CEO about what life stage the company is at today and where they want to get to in the next 24 to 36 months. That starts a strategy conversation that the CFO is leading and really allows them to get out of the day-to-day grind and step into a role where they’re thinking longer-term and more futuristically. And it helps them put realistic goals in place.

Another way is to form a collaboration with the chairman of the audit committee. They can do that by having informal meetings. Yesterday afternoon, the CFO of a company whose board I sit on called me out of the blue. He said, “Can I shoot you my script for the earnings call? I want you to take a look at it and give me your feedback before I get on this call with investors.” It’s great that he trusts me. It’s an easy, casual kind of relationship where he views me as an educated set of eyes that can help him.

CFO.com: Audit committees are taking up more of CFOs’ time and putting the CFO in a teacher-type role. How can the CFO push back on some of the committee’s questions?
Jamison: In some cases audit committees are asking for high-level, operational kinds of detail that they really don’t need to have their fingers in. It’s problematic, but that’s more for the CEO to tackle than the CFO. I don’t think it’s a fair position for the CFO to be in, but I think it’s dangerous for him to be the one to push back. In a perfect world, you’d have savvy board members who understand what their roles are so they’re not doing this to the CFO, but I think we have a ways to go on that.

CFO.com: You’ve mentioned that CFOs are unfairly perceived as being ethically challenged. How can finance chiefs change that taint, assuming it exists?
Jamison: I don’t know that there’s anything an individual CFO can do other than just do their best and be a good CFO to rebuild the trust in the profession. CFOs are often unfairly made to be scapegoats. There are only two management positions that typically are integral to the board process — the CEO and the CFO. When the board gets upset and they’re looking for change, they look to one of those two. It’s human nature for the CEO to point the finger at the CFO. Building some of those relationships more casually with board members is a good defensive move for CFOs.

CFO.com: But do CFOs have to be careful about creating too close a relationship with board members?
Jamison: CFOs have to be savvy about how they communicate what they’re doing to the CEO. A CFO is challenged to make sure that the CEO is comfortable that he’s building these relationships and trusting that they’re for the greater good as opposed to leaving the impression that he’s doing end-runs around the CEO and having conversations he shouldn’t be having.

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